POLL - Futures: How do you determine the trend?

[makosgu]

Quote from Charlie Dow:

If you read the Trend on your Chart correctly and you enter a trade on an opposing oscillation it is impossible for the Trend to reverse immediately after entry. Trends reverse on a series of oscillation not one ro even a bar. Price will always oscillate toward Resistance after entering on Support or toward Support after entering on Resistance. The key is to enter at strong Support or Resistance levels based on the exsisting trend. If price fails to break through that opposing target you simple exit your trade and wait for another reason to enter. This is the case as long as you set a ridged environment to trade from.

RATS! Your response beat me to it! Thunderdogs comment indicates a bias toward oscillations being random. Because I like illustrations, I have related Dowinism (sp???) to the following. Let us pretend that we are kids (ie. no preconcieved notions) and that we are at the beach. Because we did not look up high low tide, we have to determine whether the tides are progressing to low tide or high tide. This is so simple that maybe a few of you may identify.

The only lab tools needed for the experiment would be a marker, like a stick or discernable rock. Now what is the reason for identifying the direction of the tide. SIMPLE. The trading parallel is that if you find that the tide is heading to LOW tide (ie. lower and lower elevation levels) than we want to be SHORT since this is where the progression is heading. If we find the tide to progressing to HIGH tide (ie. higher and higher elevation levels) than you would want to be LONG since this is where the progression is heading. SIMPLE enough analogy.

So then how do you then begin to assess the current progression of the tide??? Well, using the stick it is very simple if you recognize a few key aspects of tidal movement. What is sure is that tide progressions are not random. Presumably no one would argue that. It is an either or, progession to LOW tide or (exclusive) progression to HIGH tide. What is random is the occurance of advances in retreats in the progression. So with a simple stick, it is relatively easy to assess the tide progression. You MONITOR/READ the advance and place your stick (ie. mark) at the highest point of an advance. The immediate and subsequent retreat CONFIRMS that the advance has ceased so it is easy to EXACTLY pinpoint the top of the advance. Once the retreat finishes, an advance returns followed by another retreat. On this second retreat, you now have the ability to identify the tide progression... WHY? Well, in between the LOW and HIGH tides, are the sequentially stringing but randomly located marks of advances and retreats. This progression is completely and continually self-contained. There is no lapse between an advance and a retreat. Every advance is followed by a retreat and every retreat is followed by and advance ad naseum, ad infinitum... And what of the progression??? The eye opener then just simply reduces to comparing the marked advances.

In a progression to LOW tide, you would expect to find that each subsequent advance would fail to reach the stick marking the previous advance. So then when has the progression to LOW tide end??? When, a subsequent advance pushes the stick back up the beach front. The continuation of subsequent advances pushing the stick furthur and furthur back up the beach front confirms that the progression is towards HIGH tide and thus in a trading orientation, your in a LONG. Most day traders look at the trend of an advance and the trend of a retreat. But why not just bag the length of the tide instead of the length of the retreat and/or advance...

MAK!

 

[hirsch.im.wald]

Quote from Charlie Dow:

If you read the Trend on your Chart correctly and you enter a trade on an opposing oscillation it is impossible for the Trend to reverse immediately after entry. Trends reverse on a series of oscillation not one ro even a bar. Price will always oscillate toward Resistance after entering on Support or toward Support after entering on Resistance. The key is to enter at strong Support or Resistance levels based on the exsisting trend. If price fails to break through that opposing target you simple exit your trade and wait for another reason to enter. This is the case as long as you set a ridged environment to trade from.

You assume the constant/ accumulating entropy of closed systems. That is a very grave conceptual error.
Two things can happen:
-input from outside (news)
-the system itself is learning

The second point is really interesting. When everybody can see the trend/ oscillation is drifting towards one end and the players ignoring this already have failed, i.e. lost their money, there cannot possibly be a followthrough.
There would be a wild jump that either reaches the predicted point immediately or leaves 100% of the surviving actors of the specific timeframe leaning in the same direction. A monoculture begging for a predator/ parasite.

The market necessarily has to violently swing towards the other side in a moment determined by the transformation of a crucial amount of players from a no more profitable player of the old oscillation pattern ( no more profitable, because slightly slower than his peers) to a new pattern.

This new pattern is a derivative of the old pattern. Its a new step in evolution, dependant on the learning process of the participants.
This new pattern of action might be a form of short squeezing or it may resemble more a photo negative, where new supports and resistances emerge in the empty spaces between the old ones, but the process leading to it is indefinitely subtle and complex.
Well, you'll see...

 

[marketsurfer]

Quote from Charlie Dow:

If you read the Trend on your Chart correctly and you enter a trade on an opposing oscillation it is impossible for the Trend to reverse immediately after entry. Trends reverse on a series of oscillations not one or even a bar. Price will always oscillate toward Resistance after entering on Support or toward Support after entering on Resistance. The key is to enter at strong Support or Resistance levels based on the exsisting trend. If price fails to break through that opposing target you simple exit your trade and wait for another reason to enter. This is the case as long as you set a ridged environment to trade from.

charles,

your concept sounds good( to those with little experience) and that is exactly the issue. sounding good and actually working are 2 entirely different things.

this type of thinking is highly dangerous account wise for anyone to follow.

surfer

 

[Charlie Dow]

Quote from hirsch.im.wald:

You assume the constant/ accumulating entropy of closed systems. That is a very grave conceptual error.
Two things can happen:
-input from outside (news)
-the system itself is learning

The second point is really interesting. When everybody can see the trend/ oscillation is drifting towards one end and the players ignoring this already have failed, i.e. lost their money, there cannot possibly be a followthrough.
There would be a wild jump that either reaches the predicted point immediately or leaves 100% of the surviving actors of the specific timeframe leaning in the same direction. A monoculture begging for a predator/ parasite.

The market necessarily has to violently swing towards the other side in a moment determined by the transformation of a crucial amount of players from a no more profitable player of the old oscillation pattern ( no more profitable, because slightly slower than his peers) to a new pattern.

This new pattern is a derivative of the old pattern. Its a new step in evolution, dependant on the learning process of the participants.
This new pattern of action might be a form of short squeezing or it may resemble more a photo negative, where new supports and resistances emerge in the empty spaces between the old ones, but the process leading to it is indefinitely subtle and complex.
Well, you'll see...

I don't assume anything . . . I create those silly closed systems. That is the environment I trade in. Read my previous posts.

As far as news goes . . . if you research price long enough you see that the news only increases the volatility of price in the direction it was already going. 09/11/01 was a perfect example. Not only was the Market already in a very readable and defined Bear Trend but the Lemmings (breakout traders) got short on the breach of the last Support bottom which had broken through 4 days previously. Reporters were saying, at the time, that the some government agency was going to investigate all of those that were holding major short positions on 09/11/01. My take, at the time, was that they should have investigated those holding long positions for shear ignorance.

Your second point "is" interesting but you only need to go to your local bookstore or read the threads here at ET to see that there are few individuals that believe trends exist and even fewer that can read them with any accuracy. That leaves the majority of traders sort of fending for themselves on whatever edge they have created for themselves. Which is fine but you will never hear a big sucking sound at the end of a trend . . . sorry.

There are rarely any volatile swings in price either at pullback highs or lows in trends. Mostly just consistent and readable oscillation. That is, readable in a rigidly defined & strict chart increment environment.

Look at the chart I posted a few pages back. Then read my explanation of how I read price in that environment. Overlay it and it makes sense. Trends will continue until a systematic and sequential series of opposite oscillation occur to change one confirmed trend to its inverse.

 

[Charlie Dow]

Quote from marketsurfer:

charles,

your concept sounds good( to those with little experience) and that is exactly the issue. sounding good and actually working are 2 entirely different things.

this type of thinking is highly dangerous account wise for anyone to follow.

surfer

And we never have to worry about you ever working up the gumption to do the due diligence in verifying the validity of my statements. You simply pay lip service to it like a lot of traders.

I teach traders not to blindly believe anyone, including me. When push comes to shove the only person they MUST trust is their own instincts and order entry skills. I just show traders what is consistent and the parameters that enable them to see the consistency, clearly and precisely and let them prove it for themselves whether it works or not. If they are successful, I'm ecstatic. If they fail I can usually tell why.

I have some traders doing very well with my stuff because they did they homework watching the Markets with an open mind and specifics points to assess. They taught themselves to read the Market oscillations correctly and to trade trade consistently. Others haven't done well because they came into it with a closed mind and constantly wanting to argue with the Market or wanting to add to it because they thought they could improve on it. "The Market is wrong and I am right!" I hear that over and over again. I NEVER argue with the Market. IT IS ALWAYS RIGHT, my job is to listen to what it is telling me and to act on what I read in it. Those that add to my stuff never make it either because they dilute the consistency they were looking for in the first place.

If teaching traders to trust themselves and to trade ONLY ONLY ONLY ONLY from what they can see and verify on their own that plays out in the Market every single day, week, month and year with flawless consistency so they can be as ultra conservative as possible, dangerous then what would you call everything else?

 

[Thunderdog]

Quote from Charlie Dow:

If you read the Trend on your Chart correctly and you enter a trade on an opposing oscillation it is impossible for the Trend to reverse immediately after entry.

"Impossible?" How wonderful it must be to live in a world with such certainty. How long have you been trading?

 

[marketsurfer]

Quote from Thunderdog:

"Impossible?" How wonderful it must be to live in a world with such certainty. How long have you been trading?

dog,

its the classic "if" statement. the good professor can't lose making these types of statements over and over again. if it happens, obviously you did not read the trend correctly.

true believers are always saying such things.

nothing new.

surfer

 

[Charlie Dow]

Quote from Thunderdog:

"Impossible?" How wonderful it must be to live in a world with such certainty. How long have you been trading?

10 years.

Remember, I said impossible in the ridged strict chart increment environment I trade in. You might trade in the same Market I do but you definitely don't trade looking at Price the way I do, so don't assume you see anything near what I see.

Don't berate me because we look at price differently, just approach it with an open mind and at least think about it.

It took me a long time to get to this comfort level with understanding price. I make a joke with people and say you must think outside the box to learn this . . . the correct response from a trader is . . . what is a box?

I look at some of the price charts and indicators that others use to trade and shrug my shoulders and say, "I would lose consistently if I had to trade in that environment too". Some traders have an edge and that is wonderful. If I were to try to trade using a successful traders "edge" I would probably lose my shirt. I believe consistency should not be an edge.

 

[Thunderdog]

Quote from Charlie Dow:

10 years.

Remember, I said impossible in the ridged strict chart increment environment I trade in. You might trade in the same Market I do but you definitely don't trade looking at Price the way I do, so don't assume you see anything near what I see.

Don't berate me because we look at price differently, just approach it with an open mind and at least think about it.

It took me a long time to get to this comfort level with understanding price. I make a joke with people and say you must think outside the box to learn this . . . the correct response from a trader is . . . what is a box?

I look at some of the price charts and indicators that others use to trade and shrug my shoulders and say, "I would lose consistently if I had to trade in that environment too". Some traders have an edge and that is wonderful. If I were to try to trade using a successful traders "edge" I would probably lose my shirt. I believe consistency should not be an edge.

That's all well and good. I just take exception to terms such as "impossible," "never" and the like. If it were "impossible" for the market to go against me upon my entry, then I would trade size like you wouldn't believe! I would immediately be able to take partial profits, and ride the rest of the trend for what it was worth. If that trend ended soon after, I would only have my partial profit. The point is, that I would "never" have an actual loss because it was "impossible" for the market to go immediately against me. Unfortunately, never having a loss conflicts with the world that I live in.

 

[Charlie Dow]

Quote from marketsurfer:

dog,

its the classic "if" statement. the good professor can't lose making these types of statements over and over again. if it happens, obviously you did not read the trend correctly.

true believers are always saying such things.

nothing new.

surfer

I repeat, when you wish to get off your laurels and make an honest attempt to either verify or refute what I do then you will be qualified to say anything you want and I will respect it. Until then you are just another "reporter" incapable, due to lack of gumption, to verify your sources and the content of your dribble.

Explain why traders all over the world that use my stuff see the EXACT same tops & bottoms in every Market they trade and they all trade independently? The same extreme tops & bottoms and the same non-extreme tops & bottoms. The best of them see the same entry and exit points as well. It's consistency, something most traders rarely see. The reason is the environment.