The frivolities of the last few posts beg to be redeemed by a chart. So I will share with you what is keeping me up late. (This is where you look at the chart. Oil is on top, and the NAZ is on the bottom, in case you are chart dyslexic. Sorry, I can't afford the CL subscription, so you will just have to make do with QM.) At about 10:30 AM PT, the NAZ ceased to give a shit about the price of oil. Of course I still gave a shit, and lost money shorting. Were the preceding correlations random? Is oil responding to the NAZ and not the other way around? Did CNN say that oil is dead? Or did my posts persuade the Street that Everyman is now watching oil and that it is time to fade? Any ratiocinations would be greatly appreciated.
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Old Possum's Book of Practical Charts
- Thread starter John Merchant
- Start date
Quote from John Merchant:
The frivolities of the last few posts beg to be redeemed by a chart. ..
Any ratiocinations would be greatly appreciated.
no "ratiocinations" to offer but as soon as possibility of $80 a barrel hit the news I run to a nearest gas station and noted that the reg gas price still below $2, weird!
Generally the pros call this behavior a divergence. Who cares whyQuote from John Merchant:
I still gave a shit, and lost money shorting. Were the preceding correlations random? Is oil responding to the NAZ and not the other way around? Did CNN say that oil is dead? Or did my posts persuade the Street that Everyman is now watching oil and that it is time to fade? Any ratiocinations would be greatly appreciated.
it happened. The only thing that matters is how often it happens. Take
your loss and move on to the next trade.
Perhaps the behavior you've been trading is a divergence. Only time
will tell.
Quote from John Merchant:
Bruce. A mathematical mind is a terrible thing to waste in trading. I advise you to seek your fortune elsewhere. I know whereof I speak. I am still attempting to solve Schrodinger's equation for the boundary conditions set by the high and low of the day within the box of regular market hours given the overdetermination of a predetermined quantum transition (the accurst tick). But each time I look inside the box the cat is dead. Mike.
If you've got the cat in a box, to save face, I would discourage looking. Simply, trust the cat is in there, probably dying to get out. Let the box define the cat's boundaries. As long as you know the cat is in the box (they raise quite a racket when confined against their will), you can measure the volume by multiplying the length X width X height. If you have a two-dimensional cat your problem is simplified by a third. Knowing the cat is in there should give you some piece of mind as should knowing the dimensions of the box, whether two- or three- dimensional.
Man, ET owes Jack. I wonder what % of message traffic over the lastQuote from John Merchant:
By wasting your time here, you have missed the chrysalis re-emergence of Nwbprop elsewhere, still spouting Jackisms.
year is centered around that guy. What a legacy -- he's long gone and
still being talked about. And look -- I'm extending the behavior right now!
Yup. Jack sent me on the wild goose chase of looking for a leading indicator. Now I have three of them, including oil, not a one of which is as good as a simple volume divergence. Can you believe that as of this writing my NAZDOIL chart has only been downloaded 14 times? I could post the Holy Grail and nobody would look at it.
(As an aside, how do I know when to trade a divergence of a divergence? Can I trust a revergence, or must I wait for it to diverge again? I hate near 100% correlations that randomly switch sign.)
(As an aside, how do I know when to trade a divergence of a divergence? Can I trust a revergence, or must I wait for it to diverge again? I hate near 100% correlations that randomly switch sign.)
Well - if you can use the switch from divergence to convergenceQuote from John Merchant:
(As an aside, how do I know when to trade a divergence of a divergence? Can I trust a revergence, or must I wait for it to diverge again? I hate near 100% correlations that randomly switch sign.)
and vice versa as "when" to trade -- just develop some sort of
against the box strategy using two accounts to get the direction.
I did something like that recently. I traded QM just for fun and had buy/sell buttons hot for both NQ and QM. QM started going up and consciously I meant to punch NQ short but I subconsciously punched QM long instead. Would two brains be OK instead of two accounts? I think it must be something like knowing when to transition from trend trading to range trading. I always get that wrong, too.