Is chart trading dead? (At least when it comes to ES)

[helpme_please]

Trading intra-day takes a toll on a healthy body. It is ok if you are profitable and still healthy but certainly not ok if you are on chemotherapy.

 

[Handle123]

I've had a lousy year trading ES. The lack-of-volatility, overlayed with six months of chemotherapy, just about prompted me to throw in the towel.

First lesson: Don't trade while undergoing chemo.

Second lesson: Well, that's the point of this post. Bear with me....

I just finished watching one of John Grady's excellent webinar videos on order flow. He appears to be a proponent of trading without charts, using just order flow info (in this case as presented on the Jigsaw platform). He asserts that prop firms don't allow newbie traders to use charts at all. Moreover, in this algo-driven enviroment, where the bots are scalping for two-to-four ticks, he says it makes sense to do what the bots do. He advocates trading extremes of the buzz-n-fuzz range for ticks.

Ok, a couple of questions:

1) Why would I want to compete head on with bots at their own game? Doesn't any advantage of discretionary trading stem from the fact that skilled discretionary traders are able to transcend the noise and capitalize on imbalances that lead to price dislocation?

2) Doesn't such an approach leave one vulnerable to account-decimating overtrading?

3) Am I a Luddite, seeking to justify the old ways of doing things when those old ways just don't work anymore? Maybe "chemo brain" is not too blame for the cascade of poor entries and worse exists. Maybe charts really are yesterday's tech, and ES traders need to be order flow scalpers in order to survive.

Thoughts, anyone?

When times of just plain trading badly, I get gorilla conservative and use very rigid entries like H&S, Triples two minute bars, waiting for double Bullish divergence like on two minute ES, then wait for the "thrust bar" John Hill speaks of which is a bar that closes strong up above congestion, and soon after a retracement to get into to go long. Risk few ticks and go for 6-8 ticks.

 

[learner2007]

Is chart trading dead?

If chart trading were dead, I'd be dead too!! And I ain't dead!!

 

[Gambit]

I recall an Andrew Lo lecture I found very useful in understanding efficient markets and such.

Thanks! I'll have to watch this. Lots of great stuff on youtube.

 

[Xela]

I chose the NQ over the ES years ago and have never had reason to regret it. The NQ is volatile, it's directional, it's predictable, and it moves.

If chart trading were dead, I'd be dead too!! And I ain't dead!!

I haven't been trading anything like as long as you guys, but both the observations above describe my position perfectly. But I've never tried to trade ES and wouldn't fancy it: to me, it looks a little like watching paint dry (I do about 75% NQ and 25% CL).

 

[Scataphagos]

I've never tried to trade ES and wouldn't fancy it: to me, it looks a little like watching paint dry

ES and NQ not so different.

Point value of NQ is 40% of the point value of the ES, but NQ is about 2.5x more volatile.

 

[Overnight]

ES and NQ not so different.

Point value of NQ is 40% of the point value of the ES, but NQ is about 2.5x more volatile.

I see differently pretty much every day.

This morning is no different.

As of right now, ES range per contract ~$150 today.

YM ~$250.

NQ ~$400.

NQ is superior when it comes to the number of entry opportunities on any given day, so it is really good for retail scalpers/intra-day traders.

 

[Scataphagos]

NQ is superior when it comes to the number of entry opportunities on any given day

Not really. Both tend to make their reversals at the same time.

With higher NQ volatility and more violent reversals, more difficult to catch it close to the best trade point.... IOW, "more left on the table"... not to mention the more common "air pockets" in the NQ

"net" = "not that different", from where I sit.

NQ seems like it could be much more profitable for those who "consistently nail it", but not so much for us mortal traders.

Money to be made from either if traded well.

 

[qxr1011]

I've had a lousy year trading ES. The lack-of-volatility, overlayed with six months of chemotherapy, just about prompted me to throw in the towel.

First lesson: Don't trade while undergoing chemo.

Second lesson: Well, that's the point of this post. Bear with me....

I just finished watching one of John Grady's excellent webinar videos on order flow. He appears to be a proponent of trading without charts, using just order flow info (in this case as presented on the Jigsaw platform). He asserts that prop firms don't allow newbie traders to use charts at all. Moreover, in this algo-driven enviroment, where the bots are scalping for two-to-four ticks, he says it makes sense to do what the bots do. He advocates trading extremes of the buzz-n-fuzz range for ticks.

Ok, a couple of questions:

1) Why would I want to compete head on with bots at their own game? Doesn't any advantage of discretionary trading stem from the fact that skilled discretionary traders are able to transcend the noise and capitalize on imbalances that lead to price dislocation?

2) Doesn't such an approach leave one vulnerable to account-decimating overtrading?

3) Am I a Luddite, seeking to justify the old ways of doing things when those old ways just don't work anymore? Maybe "chemo brain" is not too blame for the cascade of poor entries and worse exists. Maybe charts really are yesterday's tech, and ES traders need to be order flow scalpers in order to survive.

Thoughts, anyone?

chart trading will never die - it's just a tool...

but one should never confuse the tool with the method , which uses the tool

and Grady (whoever he is) is not an idiot - he popularizes right ideas (for brokers and props): churning the trader's account (via trading a-la bots) is the best way for brokers and props to get the most commissions off the trader's account before the bozo will lose everything to market anyway

 

[Scataphagos]

chart trading will never die - it's just a tool...

but one should never confuse the tool with the method , which uses the tool

and Grady (whoever he is) is not an idiot - he popularizes right ideas (for brokers and props): churning the trader's account (via trading a-la bots) is the best way for brokers and props to get the most commissions of the trader's account before the bozo will lose everything to market anyway

Good post.

I was going to chime in with "Grady is full of crap", but held my tongue (not sure why... that's not like me.) When you explain it from the broker's "account churning, generating commissions" perspective, makes perfect sense.