Predicting intraday price movement

Quote from dandxg:

Mike,

If you don't mind me asking, how long did it take you to get a good grasp of MP? I read Bolter's entire thread on it, it was rather informative. Thanks in advance.
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Hi Dan,

It took me about a month to really understand the details; however, within a week I was able to process and exploit the information given by applying MP. Take my comments in context though - MP is a tool and must be used correctly - it will not, on its own, produce a profitable trade/trader. MP is a tool best used by an experienced trader who wants to further his/her understanding of the auction market process, and, develop the skill to exploit the fundamental shifts that occur between buy side and sell side value. IMO, MP works because these 'fundamental shifts' are temporal in nature and MP allows the use of a temporal component/vector to identify these shifts. It is actually very simple, I use a 30 minute value range to take trades that stray out of value. I have never really used any of the more advanced ideas but there are probably some very good ones I am glossing over.

In any case - you do not need to know how to "predict" anything. Prediction is silly and will, more often than not, produce a directional market bias. While remaing neutral, the two most important assessments a trader needs to make are the following:

1. Are we range bound/elastic?

or

2. Are we trending?

MP is a one of the better tools I've found that can do this with good accuracy.

Regards,

Mike
 
Quote from Grob109:

Cheese is in a place where he says what you quoted.

What is possible and what is going on may be a different story. It is for me.

The daily range is a value that just represents a portion of what the potential of the market offers you.

At a certain point in the day you have banked the amount that the daily range turns out to be. At anther point in the day another such amount is banked. As the day progresses you find out how much more you are going to bank and finally the daily range becomes a matter of record.

One of the best estimating tools for this is to check your trading account at a few given times of the day. Each successive check is a little more accurate.

It looks like to me that cheese is connecting something or other to the daily range for some reason or other. The connection between extracting what is available on a daily basis is only secondarilyrelated to the eventual daily range that appears.

It may be that cheese feels that there is some relationship to predicting and making money. There isn't.

One basic hard hitting concept is that you have to be in the market to make money while price is changing. The caveat associated with this is to always be on the right side of the market. The ends of the daily price range are two significant points where a trader is active (taking appropriate actions) to assure that he is on the right side of the market for the near term future after any extreme has been established.

most given prices during the day are hit several times and, always, you will be owning a position building profits. You only collect profits by specific actions 20 to 40 times a day. The daily range, within which all of this happens, is rarely being stretched for a significant amount of time of the day. You always collect profits at the end of each stretching period and it always very evident as this is happening.

All of the above is different than the common entering and exiting mentality. In ET most palaver is about entering and exiting. there are not many significant good rules for this sort of thing. On the otherhand there are significant rules for making money. Making money has to do with being in the market continually and being on the right side of the market at that time. Market daily range does not come up as a factor in this stuff to any extent.

Trading through the day is like being in a sailboat race. When the race begins you stay in the boat and follow the course always making best use of which way the wind is blowing. It is true the length of all races is known by ruling the distance between the points. No one goes that distance, however. It is just there and not a concern. What is important is to know how and when to tack to get the most for the time available to win. the time available is determined when the race is over (Except in Maine).

My reading of cheese is that he doesn't race. He gets in his boat for a while and then stops and gets out to watch a lot.

When you start looking at trading as a way to make money, you will begin to consider how to get rich. Most of ET is about being right rather than being rich. The daily range stuff is about being right. Being rich is about getting in the boat, knowing how the wind is blowing (tides too), getting around the marks and how to sail the given boat you are in. In getting rich you pass the daily range several times a day as profits accumulate in the appropriate segments. None of the segments is the daily range but only part of it.
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I guess I'm just dumb, but I really don't get your slalom thing. I think to be in the market the whole session, you'd have to know a product like the back of your hand.
 
Quote from whitster:

yes, that is basically what he is saying

given sufficient "n" (number of samples, in statistical parlance), even a system that wins 90% of the time can (and will) have 10 losses in a row.

that, among other reasons , is why position sizing/risk management is SO SO SO important

my trading (YM) overall, has 81% win percentage.

however, different setups i use have different ratios. that is just overall.

my risk/reward is NOT 1:1 however. i trade multiple contracts, and my max loss (stop level) on most setups is slightly larger than the first target for selling. (like one setup i use sets a 10 pt stop, and a 6 pt then a 10 pt target for scaling out)

overall, this still results in much greater win $$$ than loss $$ but you have to have the temerity to stick with your setup;/system because the law of averages say that even a 90% win ratio (very high btw) will have many losses in a row over many trades

what i do is set a discipline rule where I am DONE if I get three losing trades in a row. and as soon as i get two losing trades, i cut my size in 1/2. this #1 keeps me disciplined (if i know i can't trade if i lose on the next trade, i won't chase or make a dumb trade) and #2 prevents big loss days, which are psychologically damaging etc.
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=================
Thats practical;
not a prediction, but practical.

Thats also one of the best things in trading to do, if one keeps careful records & with high hit rate;
cut back size, cause losses can trend like wins[serial correlation].

Usually a loss in my derivatives or stock means trend changed;
& missed it there.

Not to nitpick with thread starter,
but more helpful to think in terms of probabilities,;
if one really could predict , like a prophet in stocks/derivatives, STOPS would NOT be necessary.

Prediction is also a favorite word of snake oil salesman;
not that all who use it ar snakes,most are.:cool:
 
for the first few years, i used the 2 most important tools we can possess........OUR EYES...........then, as time wore on, I realized that the biggest obstacle to successful trading with the eyes was the brain..........we think it we internalize it and that is bias and bias is bad, that is, mind bias..........the market doesn't go where we go, we can onlyh go where the market goes........we have no position except where we t hink we will be in a w hile...........then, the mechanical system began to build over a long time........a very long time.........now the system shows the same entries over and over and over.........as mr grob says many times a day........i do not question it now that it has been tested over and over and over to be so highly accurate in the specific market i trade which is the YM intraday........works as well on es nq......to own a system such as this has built the one tool that is key to success..in this business......if hyou dont have ti forget trading and get out.........and that is conifdence.......not in yourself so much as in the system tha t gives the entry/exit signals.....the better advantage to a system is that it gives you the entry signals..........then it shows you the exit signals by giving the next entry signal which is an exit or reversal signal........when the entry signals are the exit signals with high percentage accuracy and i mean very hig h percentage accuracy, the you can build the key ingredient to you system/strategy/approach, etc........the key ingredient again is confidence in those signal producing systems and that can only be accomplished with an enormous amount of time and dedication.........the last ingredient that kept me going until finding the keys, was love of this business........i don't love money, i love t his business........silly, but true.....the midnight hours for 5 years was all pure pleasure, when i wasn't siiting there back to square one with tears in my eyes after years of failure.............now it is over...
 
b y the way, all mechanical systems dont have to change over time........if it is based on simply exposing the price direction for a few points, thst is, enough to make money and i don't mean scalping ...........although scalping is perfectly fine when the system gives you 10 pt /trade...........or so............always think of it as points times a few contracts.............always think of breakeven as the most wonderful result you can have besides making points.........just slightly less important than capturing positive points..........breakeven keeps u in the game..........losing is bad, breakeven is wonderful, positive points is beautiful...........never let a nice gain slip thru your fingers............have an exit strategy to bank pts.........my rule is when u see 10 points u must bank the points at least with one contract.........if u don't u need to work on your greed.......it is your enemy......
 
Vedanta,

It took me a while to realize that I need to trade intra day. Long term charts do not fit my psychology. I am not wise enough to use them, and the risk tolerance is above my threshold on higher time frames. Once this was realized, I started going over many different systems suitable for intraday. One of the best systems that I came across is CCI. It is perfect to trade it of 3 and 5 min charts (can be used for longer term as well). Go to www.woodiescciclub.com and absorb all information there. There is a large trading community that uses this system. Plenty of help available all free.

The system is simple, but it is not for everyone. And you will needs lots of screen time to learn how to use it properly. Once you do, the sky (or market size) is the limit.

Regards,
redduke
 
Red Duke,

If you don't mind me asking, how long have you been using CCI? Do you partake in the hotcomm room or are you solo?

I ask because I hung out in the room last fall for about a week, but decided to hire a dedicated mentor as I need more 1 on 1 time. It's seem like the nicest group of supportive people in trading. Woodie is very humble guy and helpful toom.

I listened to his presentation on the the chop zone indicator, it looked pretty impressive.

Good trading to you.

Dan
 
Quote from Grob109:
It may be that cheese feels that there is some relationship to predicting and making money. There isn't.
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There is. And I wouldn't expect Grob to know that.
:)
 
Dandxg,

I have been trading it since last September. I am in the room every morning/night (only trade Europe open which is 2:30am to 7am my time), but I trade off my own decisions only. I am not as lucky as you to be able to find a personal mentor, but thanks to forums like these you can learn a lot. There is plenty of garbage on any forum, but also many gems.

I used to only trade forex (eur/usd), but being an intra day short term trader, I had weeks in a row during November/December 2005 and February 2006 without a single trade (eur barely moved). This made me look at other instruments earlier this year, and I am planning to start live trading on DAX in April.

Chop zone and sidewinder are great, but one if the main things that CCI teaches you is discipline. You only take trades when certain set ups occur (and some of them have high strike rate), otherwise you sitting on side lines. And if does not work, you get out with small loss. You can do it all day long on any instrument that has decent liquidity and volatility.

redduke
 
Quote from Cheese:

There is. And I wouldn't expect Grob to know that.
:)
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Hi Cheese

I sent you an email, not sure if you have read it or have not had time to reply yet, but as I said in the email I am not asking you to disclose anything proprietary, but perhaps you would be kind enough to answer some basic questions like

What software do you use if you don't use charts ?
Excel or something you have written ?

What is your accuracy , 70 % or higher ?

What is your win/loss ratio ?

What markets do you trade intraday?

What are your typical number of trades per day ?

I don't expect you to answer the following, but I think I just need to ask anyway

Do you predict prices using a formula or is it something that is so radical that no one has thought of it ?


You say the correct data has to be systemized, can you explain what data ? There is bid/ask and volume, which a chart will display, what else is there ?


Many thanks
 
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