I have bought Al Brooks' Trading Course

[fourtiwinks]

To add some reality to what we discussed, let the viewers make up their own minds by observation.

J_S

Based on your given charts, does BOB mean "Beware of Breakouts/Breakdowns"?

 

[marketsurfer]

The cause of why price moves (not counting short term imbalance) could require an incredible amount of research (depending on the instrument, of course), whereas the movement as a result of the cause would have less variables to deal with (IMO), especially if it is a repeating visual charting event over history. Why would cause be a factor for TA guys who couldn't care less about things like transportation indices, earnings reports, news alerts on stocks (yeah, I've been fucked by false news...especially during a short education in penny stocks), and so on...especially if they are trading 5 minute charts? Such causes would matter to investors, absolutely, but why should short term traders care if it shows up the same way time and again on a chart?

Isn't TA the visual result of the cause (the representation of what the instrument did based on fundamentals...or better yet...what it's doing NOW because of the fundamentals or other forces (such as the fed:eek?

TA lags (indicators), price bars show what's happening now as they form (minus latency), but that doesn't mean they're not going to show a probability of where something might go, based on where it's going right now.

I don't day trade, but my observations have been that the guys who do really well are tape readers who see the bids and asks before they become the price. From this before the price data they make decisions about what price will do. Rather than studying the price itself

Sure they may chart price to get an idea of where its been but the decisions are made from the DOM.

It's incredibly difficult and takes xceptional brainpower and skills. But it can be done

Peace

 

[EPrado]

I don't day trade, but my observations have been that the guys who do really well are tape readers who see the bids and asks before they become the price. From this before the price data they make decisions about what price will do. Rather than studying the price itself

Sure they may chart price to get an idea of where its been but the decisions are made from the DOM.

It's incredibly difficult and takes xceptional brainpower and skills. But it can be done

Peace

Do you realize that the game of watching the DOM with the human eye ended years ago. I know plenty of traders who did well with it back in 2000. But that game ended back when people used those 9lb cell phones you were hawking were popular. You do realize that the HFT's have perhaps a "slight" edge over a person just sitting there watching the bid size change about every millisecond.


When I say slight I kind of mean a gigantic edge....

 

[marketsurfer]

Surf I am going to borrow a line from here and post it in the appropriate thread.

Do you realize that the game of watching the DOM with the human eye ended years ago. I know plenty of traders who did well with it back in 2000. But that game ended back when people used those 9lb cell phones you were hawking were popular. You do realize that the HFT's have perhaps a "slight" edge over a person just sitting there watching the bid size change about every millisecond.


When I say slight I kind of mean a gigantic edge....

Yeah. I have not been in the day trading game for a long time. I don't doubt what u say -- but what about the tape and dom reading software-- like jigsaw that assists human dom readers? Surely that makes more sense than charts for day traders.

I hope u are doing well. I am in the keys with a sick baby-- great day, but tonight has been very difficult. The trip may be cut short if she doesn't get better....

surf

 

[EPrado]

Yeah. I have not been in the day trading game for a long time. I don't doubt what u say -- but what about the tape and dom reading software-- like jigsaw that assists human dom readers? Surely that makes more sense than charts.

surf

Jesus...what's your excuse for being on here at 1:45 a.m. ? I just got back from a late movie.

Tape and Dom reading software might work if the actual trading decisions were made by a computer. But a human pulling the trigger? No way man. No way the human eye can beat a computer at that game anymore. And I am an old school trader so you know I want to take the side of the human when possible....but not in this case.

Your post implied you thought that guys staring at a DOM were making money as daytraders. I find that hard to believe.

As far as your chart comment? Dude. You want to go that route again? Surely you will say something slightly dumb.....and get the boot from here. Let it go already dude.

 

[EPrado]

Yeah. I have not been in the day trading game for a long time. I don't doubt what u say -- but what about the tape and dom reading software-- like jigsaw that assists human dom readers? Surely that makes more sense than charts for day traders.

I hope u are doing well. I am in the keys with a sick baby-- great day, but tonight has been very difficult. The trip may be cut short if she doesn't get better....

surf

I am posting on here at 1:45 am. (and not because I am coming home from a night of drinking). That should tell you how well I am doing. Getting old sucks man.

Anyways.....sorry about your kid. Don't mess around with the health stuff. In all seriousness play it safe. In January 2014 I almost had my ticket punched. Spent 14 days hospitalized in Jan. Then had emergency surgery in March. Spent another 8 days back there. All because I was a fucking stubborn idiot. Could have avoided the whole situation if I just went to the doc.

I'll get to one of your meetings down here. Can tell you over a beer or 10.

 

[Mysteron]

Excellent post. When you add the allure of easy money, freedom from the "boss", self employment, or even hard won money -- this stuff has incredible power over many people.

Even successful business folks and other professional educated types fall for it. They suspend disbelief -- some people keep buying this nonsense until they are ruined. Others catch on.

The worst of the worst is the lie that failure is good or desirable. This keeps 'em coming back for more. Than you ad the psychological principal that when u win a little it gives u the taste of victory and this drives the hook even deeper into the psyche.

Be careful folks, we are dealing with powerful forces.

So powerful that facts don't matter, interest in the reality of following true trading success is supplanted by "buy my course" or book because i tell you to and what i say matches what you WANT to hear.

Wake up!!

surf

Pension?

 

[Blueline]

It makes no sense to me to study the effect to predict additional effect

.....the law is cause and effect.....not effect and effect.
The only reason that prevents one from understanding and seeing is that part highlighted in "red"....."me" here is your "mind".....so you clearly have an obstruction.

 

[Q3D]

Brooks teaches observation skills. He studies the smallest details but he emphasizes the contextual probabilities are based on the larger picture. And he's quantified numerous repeating larger pictures he's constantly aware of and watching for in advance of their appearance. As an example consider LH's and LL's early in the day soon after the regular session open. He has named that context.

Brooks is a master of distinguishing the difference between minor H's and L's to the point he's usually correct when he claims HH is actually LH because within his context and the context of the day it is a LH even though for all intents and purposes a linear computer analysis would label it a HH.

After studying brooks enough you become like a musician reading every note intently while keeping in mind there's an underlying song or context these individual components are occurring within. If you do enough of this you begin to see and quantify small details or constructs he nor anyone else teaches. The biggest gains come from studying the process he uses, assimilating it and taking it to new levels. Everyone who believes this is crap and can't be done is equally correct with those who say it can because it's true for those who maintain that posture. Every time you tell me it's impossible, I hear you saying it's impossible for you.

For the few willing to do the work who recognize the improbability anyone is going to summarize brooks best concepts or conceptualize their personal understanding of why something specific he teaches works ....... those few might be worthy enough to gain from observing the consistent manner brooks quantifies everything from the smallest details to the big picture context. The rest of you aren't going to make it.

However that's not to say there isn't danger in someone describing in detail their opinion of the basis for some of brooks teachings. I caution everyone who has never been in a situation which went from being on the gravy train to a business that was no longer viable to be aware in advance that it's a bad idea to be telling folks how easy or profitable something is once you learn it's secrets because I've personally experienced this scenario in my non-trading (business life) and believe it would be unfortunate for anyone who's worked hard enough to make it as a trader ...if they would have to see their edge diluted to the point of it not working before they develop respect for discretion.

You're suggesting that properly learning to quantify, as Brooks does, every detail on a 5-minute chart leads to consistent and scalable profitability. Skeptics of Brooks see this as Brooks' marketing hook more than anything else, because they have yet to see any evidence of profitable and scalable day trader's results using this method. Brooks has likened his books to instructions on playing the violin, leaving success up to the individual's mastery of his teachings, but the evidence does not agree with this promise.

Adam Grimes (www.adamhgrimes) has done statistical analysis of moving averages and concluded that "price action following price engagement the moving average is random and unpredictable." One of Grimes' statistical scenarios involving trading pullbacks in trends (which he does see as having some statistical positive expectancy) was even found to lose money and others were near breakeven with small profits, I'm not sure if commissions and fees were included.

Brooks' method can't be reduced to quantifying details and it's not fair to conclude that those who fail to quantify like Brooks are just failures. There is a lot of gut-feeling involved, based on what the market "usually does" and guesswork based on where he thinks the daily, weekly or monthly candle should close or test at, for example.

Is it ethical to market a method of quantifying chart details and trying to reduce your teachings to something close to a science, while not addressing the highly discretionary role of intuition and guesswork?

 

[NoDoji]

Brooks' method can't be reduced to quantifying details and it's not fair to conclude that those who fail to quantify like Brooks are just failures. There is a lot of gut-feeling involved, based on what the market "usually does" and guesswork based on where he thinks the daily, weekly or monthly candle should close or test at, for example.

Is it ethical to market a method of quantifying chart details and trying to reduce your teachings to something close to a science, while not addressing the highly discretionary role of intuition and guesswork?

What the market "usually does" is also known as statistical analyses. The student can conduct such analyses based on precise quantification of details such as swing highs/lows, price turn triggers, trend line price levels, range extremes, indicator levels, multiple time frame relationships, breaks of price bars' OHLC levels, bar size, candlesticks and related patterns, etc. These details are analyzed in relation to overall context and positive expectancy setups are identified.

There are a few rare individuals who can internalize all this after a certain period of screen time and trade profitably without having to conduct formal studies. As a beginner, I thought I was one of those people, but the market taught me otherwise. What I discovered is my intuition and feelings have negative expectancy. I even took the time one week to note every trade that my intuition/gut feeling told me to and the outcome was so awful that simply taking the other side of my gut feeling would've resulted in a nearly 80% win rate. This helped me move closer to trading every valid setup no matter how improbable the trade "felt".

As a beginner I had many conversations with experienced profitable traders. Only one of them told me his trading was based on "mojo". (That was Red_Ink.) All the others had studied and quantified and often automated part or all of their methods. EricP, who posted his nearly million dollar day here on ET was running automated systems. There was no guesswork involved. The guesswork and gut feeling may have been part of the "trade idea" process very early on, but it was the scientific method and quantification that identified what the market "usually does".

To me, it would be impossible (and therefore unethical) to market a method that did not reduce trading to something as objective and probability-based as possible. I'd venture that most failed traders were brought down by trading (or skipping trades) based on gut feeling, guesswork, and then revenge trading off the resulting frustration.

Al Brooks' doesn't have "a method". He reveals numerous trade ideas and related setups, shares some effective ways of entering and managing the trades, and warns the novice of common traps (usually based on feelings like "this trend just has to be reversing now").

I have the greatest respect for those who can internally process all that scientific stuff and trade effectively from it without setting up any sort of plan. They are extremely rare from my experience.