Spydertrader's Jack Hershey Equities Journal II

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Quote from ebulldog:

If you have a annotated chart of GMXR, would you mind posting it? I’m flummoxed because my daily has it hitting a point 3 on 11/27 then bouncing up to hit almost perfectly the left trendline on 12/5 and bouncing back down. There does seem to be a failure to retrace forming today/yesterday. Would you trade a failure to retrace in the same way as an FTT?
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<img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=1290307>

See attached GMXR annotations in above chart. What you term 'failure to retrace,' I see as continuation from the FTT (blue channel).

Quote from ebulldog:

I do see FTT’s on the 30 minute chart – are you trading the 30 minute not the daily? Do you believe that trading FTT’s would be effective on an EOD basis?
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FTT's occur on any time frame (provided sufficient liquidity exists). In addition, the equities system as described trades on a daily time frame.

Quote from ebulldog:

Having read both logs, all of Jacks’ material I could locate and watched all the videos, it doesn't’t seem that Jack stresses the FTT’s in the way you are. I need to be able to put this within the context of everything else I’ve read. I get the feeling that your experience has taught you that trading the FTT’s is the concept behind Jack’s teachings. That he’s wrapped all these other tools around that concept in an attempt to teach this to others. I guess I’m wondering if that is true, or if trading the FTT’s is something that your experience has taught you is successful, but is not necessarily directly in line with Jack’s method – or if I’m missing the concept.
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Jack has added the tools in an effort to make it easier for a trader to act when seeing an FTT. Using the various tools confirms what the trader should see. I cannot place enough emphasis on this: Learn to spot the FTT.

Quote from ebulldog:

Everything I’ve been trying to do up to now has been looking for the set-up of dry-up at the bottom of a TL, increase in volume as it bounces off and up, and you buy. Trading FTT’s seems almost the opposite. You short when it FAILS to reach the left (upper) line in an up channel. You go long when it FAILS to reach the left (lower) line in a down channel. So rather than going long in a strong up channel, I’m going long when a down channel might be ending and a new up channel may be forming. Am I somewhat on track here?
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No problem. If you do not feel the time is right to move forward, don't. All the methods listed in both Journals focus on entering or exiting based on what happens after an FTT occurs. Most people need to be brought along the continuum at a pace where gradual change permits the building on a paradigm of successful reinforcement. By focusing on locating the FTT, a trader can then use the indicator set and historical sequences as confirmations for holding longer term.

Again, no need to rush forward. I simply wanted to provide a transition point for those individuals ready to take the next step, as well as provide a transition from journal Two to Journal Three (in 2007).

Enjoy the Weekend.

- Spydertrader
 

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Quote from 8833broc:

Please see attachment for channel question.
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Yes, I was in a hurry trying to get ready to attend a Christmas Party this evening. In an attempt to avoid confusion, I deleted the channels no longer relevant. Unfortunately, my efforts resulted in additional confusion. I apologize for that. See the chart snippet below for the additional (deleted) lines.

<img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=1290310>

Quote from ebulldog:

Can someone correct me if I'm using the scripts incorrectly? Thanks!
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Looks great. Keep up the super job.

- Spydertrader
 

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I took a long position in NVEC today, entering at 11:07 am, fill price of $38.63.

Daily Fractal Criteria
Price
Price did not gap more than 5%.

Volume
NVEC has been in DU for the past 3 days.

Channels
I have the current LT channel as an uptrend. The current IT channel is a downtrend, and the current ST channel is an uptrend. A FTT occurred 4 days ago.

Indicators
MACD histogram was rising.
MACD fast and signal lines were below 0 and rising.
Fast Stochastic fast line was turned up and heading for 50 XO.
Slow Stochastic fast line was turned up and heading out of 20 zone.
20 SMA is significantly above the current bar (ie no resistance nearby.)

All of these together made for a very nice setup, and as such, I began to monitor the 30m fractal for the opportunity to enter.

30 minute Criteria
Volume
Daily volume exceeded LBDU at 11:07 am. Volume rate was beginning to accelerate. The 30m bar volume had exceeded the previous bar's volume.

Price
Price had improved above previous day's close and was nearing previous day's high.
Price broke above 20SMA on previous bar.

Channels
Price had broken above a previous LTL on the ST channel.

Indicators
MACD histogram was positive and increasing.
MACD fast was above 0, signal was below zero. They were diverging.
Fast Stochastic fast line > 80.
Slow Stochastic fast line > 80.

Hold Criteria
Price remained above yesterday's close.
Price remained above my 2% stoploss level of $37.85. [edit for typo]
Price and volume maintained good channel patterns on the 30 minute.
 

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Aurum,

The only comment I would make is that NVEC didn't make FRV, so strictly (according to beginner equity rules) it should be exited at EOD (or on open next day as the 'rules' were amended to)

I entered PCCC @ 14.06 and COGO @ 18.27 via my auto-script. When I got up this morning, I entered NVEC @39.20 (my position sizing algorithm was too conservative, so it didn't enter it automatically at 39.05 when I got a signal).

Of these three, only PCCC got above FRV or even the 65 day average, so would be the only one held according to the Journal 1 rules.

Of course, there are many different rules, I'm just commenting on the trade as I see it.
 
Thanks for the comments Mischief, and you are correct about the volume criteria for beginners.

According to my calculations (which may be slightly different than others), I have the FRV level for today at 540k.

With that in mind, I've moved a bit beyond the beginner stage with respect to volume criteria for holding. If volume doesn't meet FRV, then I make sure it had price improvement and volume improvement over the previous bar. If not, then I'll exit it.
 
Quote from mischief:

Aurum,

The only comment I would make is that NVEC didn't make FRV, so strictly (according to beginner equity rules) it should be exited at EOD (or on open next day as the 'rules' were amended to)

I entered PCCC @ 14.06 and COGO @ 18.27 via my auto-script. When I got up this morning, I entered NVEC @39.20 (my position sizing algorithm was too conservative, so it didn't enter it automatically at 39.05 when I got a signal).

Of these three, only PCCC got above FRV or even the 65 day average, so would be the only one held according to the Journal 1 rules.

Of course, there are many different rules, I'm just commenting on the trade as I see it.
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Thanks for clearing this up. I just wanted to know what was wrong and you explained it perfectly.

- Monk
 
Quote from mischief:

Aurum,

The only comment I would make is that NVEC didn't make FRV, so strictly (according to beginner equity rules) it should be exited at EOD (or on open next day as the 'rules' were amended to)

I entered PCCC @ 14.06 and COGO @ 18.27 via my auto-script. When I got up this morning, I entered NVEC @39.20 (my position sizing algorithm was too conservative, so it didn't enter it automatically at 39.05 when I got a signal).

Of these three, only PCCC got above FRV or even the 65 day average, so would be the only one held according to the Journal 1 rules.

Of course, there are many different rules, I'm just commenting on the trade as I see it.
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mischief,

I followed your posts with great interest from the beginning of this journal, and I think the first one as well. I'm glad to see you are still around. Please continue to post. By the way, have you done any more work on the amibroker scripts? Also, do you recommend the basic amibroker version or the professional one?

-John
 
Quote from Charly:

Sorry - no clue what you mean.

Charly
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Use the search button above, there is plenty of information on various threads. Happy searching/reading.
 
NVEC 30 minute chart. It looks AOK to me. Near the 50 day MA for potential support. You might want to use a stop offset based on the bottom trend line.

attachment.php
 

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