Spydertrader's Jack Hershey Equities Journal II

[Spydertrader]

Quote from mephistoII:

OK, let's say that I am long the mkt from somewhere to the left of the screen, in response to the upsloping green trend channel. I barely maintain my position when price spikes downward through the right green TL (5th bar from the far left), but the stop holds and I am encouraged w/ the appearance of the reversal bar accompanied w/ good volume.

Forget stops. Forget everything you thought you knew before about the markets. Set it completely aside, out of sight and out of mind. Starting with bar one of your chart, you offered up the experimental position that you were long. We can start there. On Bar Six (again on your chart) price fails to make it to the left Green Trend Line (Circled Area One) - forming an FTT. Price then moves away (in the opposite direction of the current [Green] Trend) and heads lower. After Price Fails to Break Out of the Green up trend (Circled Area Two). One could have chosen to draw in a steeper up channel and this point - using the (thus far) low (bar 5) of the day and current bar (circled bar 11) as Points One and Three and the FTT (Circled area One) as point 2.

The (Beginner) rules for entry with respect to trading FTT's are as follows:

FTT -----> FTT (reverse)
FTT -----> FBO (exit)
FTT -----> BO (hold)

As a result, where you were once long (experimental position indicated above), you need to short where I have marked the FTT (Circled Area One) and then Exit (as a Beginner) at he FBO (Circled Area Two).

Now, according to the Beginner Rule Set, you need to wait for another FTT to appear. When price makes a new high (Circled Area Three) and price moves away from this point, we anticipate either a retrace or a reversal.

Why? Because price has failed to move higher off the high. Price may head back higher, or it may continue lower, but right now price is lower so we are left with only retrace or reversal - from this exact point in time. In order to have continuation, price must exceed the previous bar. Right now, continuation remains several tics away.

Back to the current price trend:

As price continues lower and bounces off our Green Trend Line (Orange 2) only to continue lower again (Orange 3), we have created a Point Three Down Channel (Orange). At that same exact point, we also have an FTT of the Green Up Channel (Circled Area 4). This FTT informs the trader to once again enter short.

Hopefully, the above explanation provides you some clarity.

- Spydertrader

 

[Spydertrader]

Quote from bi9foot:

I am adding RBAK to my final universe.

After your post, I went back and reviewed the RBAK Chart. Price had just finished a 20% run on Friday - providing the 5th such run in the last six months. Normally, the chartscript takes a day or two to recognize the last trend when price sits on the left trend line (as it does with RBAK). However, Quote.com currently shows RBAK with a negative EPS. As a result, I've added RBAK, but plan to wait to see what happens in the future.

- Spydertrader

 

[bi9foot]

Quote from Spydertrader:

After your post, I went back and reviewed the RBAK Chart. Price had just finished a 20% run on Friday - providing the 5th such run in the last six months. Normally, the chartscript takes a day or two to recognize the last trend when price sits on the left trend line (as it does with RBAK). However, Quote.com currently shows RBAK with a negative EPS. As a result, I've added RBAK, but plan to wait to see what happens in the future.

- Spydertrader

I use IBD daily graphs. The EPS value is from IBD. From Daily Graphs here are the earnings values (listed starting last Q, the second column is the same Q a year ago)

Sep 06 0.12 vs -0.08
Jun 06 0.10 vs -0.05
Mar 06 0.05 vs -0.05
Dec 05 0.01 vs -0.08

MSN sites shows negative EPS as well.

 

[Spydertrader]

Quote from bi9foot:

MSN sites shows negative EPS as well.

We have seen this before. The discrepancies result from different web sites using either Quarterly or Yearly EPS values. I believe Quote.com uses yearly EPS values (last I checked). Again, thanks for bringing RBAK to everyone's attention.

- Spydertrader

 

[mephistoII]

Quote from Spydertrader:

Forget stops. Forget everything you thought you knew before about the markets. Set it completely aside, out of sight and out of mind ...


Hopefully, the above explanation provides you some clarity.

- Spydertrader

To the first comment quoted above: no tears shed over that idea - hahaha. I've been scrappin' tooth and nail for a very long while, just to remain in the game. The ol' two steps forward, one and three-quarters back.


And to the second: very much so! Thanks to everyone's assistance today, the fog has actually started to lift!


At this point in time, I just intend to practice channel drawing realtime in my chosen mkt, the Euro currency (globex), while also begiining to hone in on the pv relationship in that mkt. I'm going on the assumption here that these techniques can be applied to any mkt.

That is not to say that I can't appreciate the complete methodology as it relates to the ES, especially considering the abundance of supporting evidence which is available, such as the YM leading indicator, stretch/squeeze, etc . Perhaps I am making a mistake by not just switching mkts - if that could be the case, don't hesitate to say so.

Once again, thank you, guys ...

 

[stevegee58]

Looks like MED is back in the Final Universe.

EPS: 0.4
Volume: 464209
Float (Yahoo): 11172000
Float (MSN): 12713400
Rank: 4.71

 

[Bearbelly]

Quote from mephistoII:


At this point in time, I just intend to practice channel drawing realtime in my chosen mkt, the Euro currency (globex), while also begiining to hone in on the pv relationship in that mkt. I'm going on the assumption here that these techniques can be applied to any mkt.

.. [/B]

I watch the euro in addition to es and ym and , imo, it is an entirely different animal. A lot of bizarre moves that makes channel drawing difficult.

 

[mephistoII]

Quote from Bearbelly:

I watch the euro in addition to es and ym and , imo, it is an entirely different animal. A lot of bizarre moves that makes channel drawing difficult.

Thank you, bb - its good to get another perspective. The jury is still out here, as pertains to where I might end up. May I ask what time frames you have used w/ the euro?

 

[Bearbelly]

I use the same template w/ 5 minute charts on all markets.

 

[Joab]

Quote from mephistoII:

Thank you, bb - its good to get another perspective. The jury is still out here, as pertains to where I might end up. May I ask what time frames you have used w/ the euro?

I trade the 5m FTT EURUSD spot and I will warn you to stay OUT during reports and only either trade the US open or the London open for the first 3-4 hours.