Observations (an example)

[fortydraws]

 

[fortydraws]

Someone not worried about scalping a few ticks here and there can do quite well just saving their efforts for the extremes. Most days the NQ will traverse from one limit to the other at least once. Of course, the fact that price bent both sides of the range would have the anti-TA crowd saying "see, TA doesn't work." Well, of course it doesn't "work." You, your trading plan, and your ability to follow that plan is what "works."

 

[dbphoenix]

Soybeans again ... Yes or "No no no don't do that!" ?? (question for DbPhoenix)

I've never studied soybeans. Is it mean-reverting?

 

[fortydraws]

I've never studied soybeans. Is it mean-reverting?

I'm trying to figure that out - someone once told me I should attempt to characterize a market before attempting to trade it.

 

[Gringo]

I'm trying to figure that out - someone once told me I should attempt to characterize a market before attempting to trade it.

Thanks for remembering me. I do happen to say intelligent things when I am not paying attention.

 

[fortydraws]

Of course, the fact that price bent both sides of the range would have the anti-TA crowd saying "see, TA doesn't work." Well, of course it doesn't "work." You, your trading plan, and your ability to follow that plan is what "works."

DbPhoenix referenced a thread from 11 years ago where someone else referenced a quote by DbPhoenix from that time or before. Within that quote, I read this:

"An indicator, a pattern, a system, is a tool. A tool does not work. A tool simply is. It is the person who uses the tool who works. If anything doesn't work, it is the person who is supposed to be doing the work, not the tools themselves. To say the (fill in the blank) "doesn't work" is a stupid thing to say."

I just thought the similarity striking, and this is my journal, so I thought I'd note it here. Of course, I did read Larry Phillips's book (on DbPhoneix's recommendation), but it didn't come from there. I guess I may have learned a thing or two about trading from DbPhoenix after all.

 

[dbphoenix]

I guess I may have learned a thing or two about trading from DbPhoenix after all.

That schmuck? He trades?

 

[gears]

I have observed that following a breakout, the pullback point - the price at which sufficient demand materialized to prevent price from going lower - is typically the first line for support during the next pullback. Sometimes, perhaps most of the time, this pullback level is the prior high +/- a couple of ticks or so, or as it would have been in this case, Friday's Globex high. But sometimes demand is so strong after the breakout that the "typical" pullback is arrested, and price puts in a higher low above the BO.

Could I trouble you to explain the highlighted portion further?

 

[fortydraws]

Could I trouble you to explain the highlighted portion further?

Suppose price trades to a double top, and then, on the third try, it finally breaks the high and gallops higher - lets's say 10 points higher. Eventually, it comes time to rest, and price pulls back toward the level of the double top. Very often, price pulls back that whole 10 points to that "former resistance" to test it as support. But sometimes, before price can come back to that level, buying pressure gathers again, and rather than pulling back the 10 points to the BO level it only pulls back 5 points, and then resumes its gallop to higher highs.

 

[dbphoenix]

Suppose price trades to a double top, and then, on the third try, it finally breaks the high and gallops higher - lets's say 10 points higher. Eventually, it comes time to rest, and price pulls back toward the level of the double top. Very often, price pulls back that whole 10 points to that "former resistance" to test it as support. But sometimes, before price can come back to that level, buying pressure gathers again, and rather than pulling back the 10 points to the BO level it only pulls back 5 points, and then resumes its gallop to higher highs.

And that's called . . . (let's not always see the same hands)