Son of If You Can Draw a Straight Line . . .

[dbphoenix]

Quote from r3algood:

Hello everyone, I am working my way through reading this thread and applying the techniques bar by bar. I have started marking up charts and analyzing them using demand lines and supply lines and thinking about what price is currently doing in relation to supply/demand.

I marked up the following charts of Friday's (18th Oct) S&P Emini (ES) chart in accordance (hopefully!) with db's guidance in this thread.

I would really appreciate feedback from you guys. I have much to learn, but I am working hard at forgetting all the crap and bad habits I have learned over the years.

I look forward to contributing to the discussion here.

http://imgur.com/a/CElej (album link if images do not appear)

Thanks

Since you're new, your post didn't show up at the time you posted it. Therefore, unless you refer to a post after you have 5, it likely will not be noticed. I happened to see it because I was scrolling back.

In any case, the first thing I noticed was the gap you provided. There are no gaps in futures, except for Friday afternoon to Sunday evening. So the first long entry you made was correct but for the wrong reason: it had nothing to do with a gap but with a double bottom.

As for the rest, I'll leave the comments to those who are studying this. It'll be good practice. But you probably noticed by now that your charts are HUGE. If you want comments, I suggest you scale them down a bit to make them digestible.

One question, though, did you annotate these charts in real time? Some of the annotations suggest that you did not.

P.S. Forget about the 50% business for now. It turned out to be more a diversion than a help.

 

[Huyang]

Although my posts in the past may not be closely related to the topic --- a natural product of not really understanding the fundamental concept, I am seriously trying to learn from all those discussions. I tried again on NQ of 10/18 by bar by bar moving forward. Please feel free to give me any feedback. Thank you.

 

[r3algood]

Quote from dbphoenix:

Since you're new, your post didn't show up at the time you posted it. Therefore, unless you refer to a post after you have 5, it likely will not be noticed. I happened to see it because I was scrolling back.

In any case, the first thing I noticed was the gap you provided. There are no gaps in futures, except for Friday afternoon to Sunday evening. So the first long entry you made was correct but for the wrong reason: it had nothing to do with a gap but with a double bottom.

As for the rest, I'll leave the comments to those who are studying this. It'll be good practice. But you probably noticed by now that your charts are HUGE. If you want comments, I suggest you scale them down a bit to make them digestible.

One question, though, did you annotate these charts in real time? Some of the annotations suggest that you did not.

Yes, I will tone down the size of the charts in future posts.

No gaps: (24 hour chart) noted.

"One question, though, did you annotate these charts in real time? Some of the annotations suggest that you did not."

This first session of marking the charts up in this manner was not in real time, though I did slowly scroll bar-by-bar. I think that Friday's price action being so fresh in my mind skewed the markup process. In future posts I will annotate sessions that are sufficiently in the past (or wait and see where the other members of this thread take the discussion, if past charts are unwelcome I will refrain from posting them and taking up space unless other members find it good practice).

Db, in annotating this chart I found a new-found sense of confidence due to the simplicity and realistic nature of letting price decide instead of trying to let my thoughts "guide the market". How foolish to think that the market should respond to my wishes and desires.

I look forward to learning more.

Thanks

 

[dbphoenix]

Quote from Hooti:

I do understand why in a general way. And in my case I apologize. I am more interested than I can say, but the fault is mine in wandering off topic.

I do perseverate in problem solving, which makes it hard to fit in and participate. Probably not the easiest student to have...
but none of that means I can't comply on topic in future posts.

Perseveration is fine as long as it's in the right direction. But complicating what is here with what you're carrying will likely only make matters worse for you. You have to decide which way you want to go.

 

[Huyang]

Draw lines bar by bar moving forward ( from 07:15 to 08:34 PST)

 

[Gringo]

Quote from Huyang:

Draw lines bar by bar moving forward ( from 07:15 to 08:34 PST)

I have glanced at what you have posted and how you have drawn the lines and I must say it's much much better. Keep it up. Do you feel your understanding of when a decision needs to be made getting better. Even though you're not always right the reasons for getting out at a loss or a profit are all related to the market and not dependent on how you feel.

If you had continued through the day like this in the afternoon you would have gotten that mega long move and staying in most of the time. This is what I was talking about when I mentioned the day was not without twists. Some would have started to question their methods but that's the thing with trading. Some times you're not going to make much but sticking with the plan is the key. Keep up the work. This will start becoming second nature after some practice. Your lines are not precisely how I would have done it but your idea is correct.

Gringo

 

[Huyang]

Quote from Gringo:

I have glanced at what you have posted and how you have drawn the lines and I must say it's much much better. Keep it up.
Gringo

Gringo:

Thanks a lot for your kind words. The only difference between my previous drawing and current drawing is that i am now doing exactly bar by bar analysis and plan in advance the conditions to exit, following the advice in this thread. No matter what, i am very thankful for what i have learned from all those discussions.

Draw lines bar by bar (from 08:37 to 10:35 PST).

 

[Gringo]

Quote from Huyang:

Gringo:

Thanks a lot for your kind words. The only difference between my previous drawing and current drawing is that i am now doing exactly bar by bar analysis and plan in advance the conditions to exit, following the advice in this thread.


Draw lines bar by bar (from 08:37 to 10:35 PST).

Compare your DL with mine. You have a new DL from almost every breach. I didn't do that. I used the same point of origin but used the new swing low to have this new DL. What you're doing may not be wrong actually.

Gringo

 

[Huyang]

Quote from Gringo:

Compare your DL with mine. You have a new DL from almost every breach. I didn't do that. I used the same point of origin but used the new swing low to have this new DL. What you're doing may not be wrong actually.
Gringo

Gringo:
I agree your one DL is simpler. I found out drawing those lines keeps me to focus on the price but not the feelings. When and why do i draw those DL is written in the chart.

From Gringo:
Do you feel your understanding of when a decision needs to be made getting better. Even though you're not always right the reasons for getting out at a loss or a profit are all related to the market and not dependent on how you feel.
Yes. Forgetting about feelings and focus on the market makes difference.

I was following what DB wrote before: Therefore, the first thing you look for after the break is a retracement. If there isn't one, there's no short. However, there are only two outcomes here: that the move will be brief and not worth trading, or that price will collapse and you'll be left with no trade at all. The latter can happen, but if it does, a serious move to the downside isn't going to be short-lived and there will be an opportunity at some point to enter if one just waits for it. Yes, it's possible that price will reverse right after the short is placed, but that's a separate issue.

If there is a retracement and the short is taken, you then start looking for signs that the move is coming to an end, and this is where the swing lows and the extent of the downmove apply. If the swing lows are not breached and/or the downmove is not extensive -- the one on Friday was 25%, as I pointed out in the questions -- then you have to be prepared to exit as soon as the supply line, which you have by now been able to draw, is broken and look for a retracement in the subsequent upmove to go long again.

 

[slugar]

I have a question on Friday at 8:50 cst you get a retracement and a chance to go long and it did work but if the trade goes against you do you simply exit at the break of the demand line? And then again at a little after 9 you get a break of a steeper fanned line but you have a swing low to use or the fanned out demand line as an exit just a little confused on the 1st trade!