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S/R Emini Journal
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What is cascading was asked.
When an event is coming up, people who are betting and in the market use "protection" to limit their losses. Stops of various kinds are placed for this purpose and it is very widespread as a money management concept. These kinds of stops are usually the type of order that is executed just after the market has traded at the price showing on the protective stop. Ordinarily it works for people who want to lose only so much money as part of their betting plan.
Cascading is a term used to describe what happens when a lot of protection goes from a stop order condition to a market order condition.
Here under this condition, the market is said to be "one sided" since all these new market orders have no trader or trader's money facing them.
the market order keeps going against the owner's plan as it seeks any price and more and more worse prices to be exercised. I have seen gaps in price values, especially before the e minis were invented.
Today we knew there were going to be three cascades in series.
There was about four minutes notice on the first "down" cascade before it happened. I posted two charts, one for ES and one for YM, here to let people know. Then I said whoopee, humourously.
In my journal, I also posted the advance notice as a chart for the third cascade.
It is particularly fun to trade cascades and when the market comes back into balance momentarily at the end of a cascade you do what is called "trading the spike".
As the spike appears in a cascade you know that a heck of a lot of people are making a mistake by butting in protection behind the cascade. You know they are going to get aced and it is going to be getting aced in the opposite direction.
you have to get your reversal in (it is twice the number of shares that you "hold" to make money. It has to be filled as one order and partial fills are a pain in the ass. It has to be done as you SEE the DOM stablizing along with a few other leading indicators of price. The CW paradigm doesn't handle making money at fast paces so I have a big advantage as the second cascade begins to happen.
In the reversals on cascading it is a scene much more exciting than just trading opposite people getting "whipsawed". They usually are sidelined after a couple of "whips". People who screw up during cascading are throwing "protection" into a market that cannot handle it so they get aced.
three cascades are SOP. and the market returns to the former MLR line by being over, under or critically damped. It is not easy fro trading to do a reversion to the mean after three cascades. There are a lot of very shook up people.
I use your journal as a measure of how many people are shook up by whatever is going on the market. a lot of posting means few people are shook up. When your thread drops below the fifth level in journals I know it is a bad day.
I am posting informational stuff here. and this is an adult and informaticve post. some of your folk think my posts and abreviations are derrogatory. that is just their bias and not my bias. I am glad to contribute at any time when I have time.
When an event is coming up, people who are betting and in the market use "protection" to limit their losses. Stops of various kinds are placed for this purpose and it is very widespread as a money management concept. These kinds of stops are usually the type of order that is executed just after the market has traded at the price showing on the protective stop. Ordinarily it works for people who want to lose only so much money as part of their betting plan.
Cascading is a term used to describe what happens when a lot of protection goes from a stop order condition to a market order condition.
Here under this condition, the market is said to be "one sided" since all these new market orders have no trader or trader's money facing them.
the market order keeps going against the owner's plan as it seeks any price and more and more worse prices to be exercised. I have seen gaps in price values, especially before the e minis were invented.
Today we knew there were going to be three cascades in series.
There was about four minutes notice on the first "down" cascade before it happened. I posted two charts, one for ES and one for YM, here to let people know. Then I said whoopee, humourously.
In my journal, I also posted the advance notice as a chart for the third cascade.
It is particularly fun to trade cascades and when the market comes back into balance momentarily at the end of a cascade you do what is called "trading the spike".
As the spike appears in a cascade you know that a heck of a lot of people are making a mistake by butting in protection behind the cascade. You know they are going to get aced and it is going to be getting aced in the opposite direction.
you have to get your reversal in (it is twice the number of shares that you "hold" to make money. It has to be filled as one order and partial fills are a pain in the ass. It has to be done as you SEE the DOM stablizing along with a few other leading indicators of price. The CW paradigm doesn't handle making money at fast paces so I have a big advantage as the second cascade begins to happen.
In the reversals on cascading it is a scene much more exciting than just trading opposite people getting "whipsawed". They usually are sidelined after a couple of "whips". People who screw up during cascading are throwing "protection" into a market that cannot handle it so they get aced.
three cascades are SOP. and the market returns to the former MLR line by being over, under or critically damped. It is not easy fro trading to do a reversion to the mean after three cascades. There are a lot of very shook up people.
I use your journal as a measure of how many people are shook up by whatever is going on the market. a lot of posting means few people are shook up. When your thread drops below the fifth level in journals I know it is a bad day.
I am posting informational stuff here. and this is an adult and informaticve post. some of your folk think my posts and abreviations are derrogatory. that is just their bias and not my bias. I am glad to contribute at any time when I have time.
Quote from Grob109:
I use your journal as a measure of how many people are shook up by whatever is going on the market. a lot of posting means few people are shook up. When your thread drops below the fifth level in journals I know it is a bad day.
I am posting informational stuff here. and this is an adult and informaticve post. some of your folk think my posts and abreviations are derrogatory. that is just their bias and not my bias. I am glad to contribute at any time when I have time.
At least somebody is using my journal for something...I was looking through your journal while ago and thought is was funny to see you referencing my journal. I doesn't matter to though as long as all is civil. I can and will learn from all.
Thanks,
Gary
Quote from belavia:
Thanks Romik, I am actually reading about a pattern similar to that in a book. Would you look for a breakout to act on?
just to let you know, I finished at 0 for the day. These days do happen, it's just like running a regular business, there are always days when there is no profit, so no worries. I have taken a trade before the fomc minutes, which resulted in TA going out of the window basically.
I am getting a drink right now, so I will answer your Q tomorrow.
Quote from belavia:
Thanks Romik, I am actually reading about a pattern similar to that in a book. Would you look for a breakout to act on?
Romik,
I hope you don't mind me butting in here but here is the same thing drawn two different ways. Look at this chart and see which way price should break, then look at the next one then the third and final one
Here is the first one.
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Quote from romik:
just to let you know, I finished at 0 for the day. These days do happen, it's just like running a regular business, there are always days when there is no profit, so no worries. I have taken a trade before the fomc minutes, which resulted in TA going out of the window basically.
I am getting a drink right now, so I will answer your Q tomorrow.
Alright, take your time. Just wondering, do you ever have a losing week?
Well I hope everyone is having a nice week trading so far. Mine has been decent. Today I had one win for +2 and one loss for +2 on a half position. I have got to stop trading in th afternoon. Just kidding that just so happens to be when both of my losing trades were this week. Still + for the week though.
Here are my numbers for tomorrow. My trading will be very limited for the next few Wednesdays as I will be in clinic from 10 till 5 CST. That doesn't leave much time for trading unless something hits early in the day which I will be watching for.
Long 1308.25 - 1312.25 (same as today)
Short 1301.25 - 1297.00 (Callmate I think you called this one)
We have some guys and gals that have been emailing me charts lately and they have been getting good at this. Way to go...
Have a good trading day everyone,
Gary
Here are my numbers for tomorrow. My trading will be very limited for the next few Wednesdays as I will be in clinic from 10 till 5 CST. That doesn't leave much time for trading unless something hits early in the day which I will be watching for.
Long 1308.25 - 1312.25 (same as today)
Short 1301.25 - 1297.00 (Callmate I think you called this one)
We have some guys and gals that have been emailing me charts lately and they have been getting good at this. Way to go...
Have a good trading day everyone,
Gary
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