Spydertrader's Jack Hershey Equities Journal II

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I'll try to join everyone in the chat room tomorrow. Equities are not behaving well right now and it sounds like a good opportunity to develop other skills.

I think it's kind of funny that people want these threads distilled to book form. I understand that it would be nice to swallow a pill and get all of the knowledge in one gulp, but that doesn't happen. People charge $500 or $10,000 a pop for DVDs and seminars and books to teach you methods, but you'll never get the depth that you will get by devoting yourself to following these threads.

The value isn't in the destination. There is no destination, at least none that anyone can ever reach. The value is in the journey. And here you have an amazing journey laid out in front of you, from accomplished beginner to a master and a teacher of men. Savor it as you would a novel, study it for the nuances, and then make it your own.

I know I'm not trading the same method that Spydertrader and Jack trade, I'm not even trading what they teach. But by using the principles they teach and learning from their experiences, I have a great system which has worked wonders for me. What's more, I know that I can return to these pages every few months and pull out more gems.


And you would want that distilled? You would lose all of the richness. You might as well go to coiledmarkets and pay them. You'll make money and won't have to go through the hard work that comes with a deep education.


Alright, there's my speech. See y'all in the chat room tomorrow.
 
As price progresses from right to left within a channel, the task is to identify a potential FTT. Assume for a moment that we restrict our tools to channel lines, price bars and volume. Until the high of the current bar surpasses the high of the preceding bar (assuming a long channel), then the previous bar is a potential FTT. As soon as the current bar exceeds the high of the preceding bar then the current bar becomes a potential FTT. By monitoring the volume of the current bar as it forms, we can estimate whether or not its volume will exceed that of the preceding bar. If the pro rata volume is less than the volume of the preceding bar and price has not yet exceeded the high of the preceding bar, then the preceding bar may be an FTT and a trade entry is considered. If the pro rata volume exceeds that of the preceding bar then price is likely to continue towards the left hand side of the channel.

This approach to identifying an FTT means that entry will never be during the formation of the FTT bar and I believe that Spydertrader will often enter during the formation of the FTT bar itself. It does however mean that entry can be considered prior to the low of the potential FTT being broken, which is frequently far too late.

This is how I am currently using channel lines, price and volume to identify a potential FTT. However, consistent successful identification has yet to be achieved. I would be more successful flipping a coin so I can only conclude that I am missing or misinterpreting some vital piece of the decision process.

When price does not proceed in the desired direction after entry, I am then faced with (a) do I reverse (b) do I hold and hope to wash for a breakeven trade, or (c) do I exit with a small loss? Bearing in mind that some time must elapse before one can evaluate the pro rata volume / price action after entry, I invariably find myself whipsawed if I reverse. Exiting with a small loss is fine occasionally but it is fast becoming a habit. Option (b) seems too ambiguous and I don’t like trading on hope.

I would value any constructive practical comments from others who have made progress towards consistently identifying FTTs.
 
Very interesting morning for me. I was in short on bar 6 and just got out on bar 26 with 3 reversals and a net of 6.75 pts. Unfortunately I was on a simulator.:( First entry was off an ftt but the reversals were done off volume alone with the full intention to reverse again if the hi/lo was taken out but it was not necessary. I'm sure this was beginners luck. I tried to get in the chat room this morning but could not. Some days it will let me in and some days it wont.
 
Quote from foible:

....... People charge $500 or $10,000 a pop for DVDs and seminars and books to teach you methods, but you'll never get the depth that you will get by devoting yourself to following these threads.

The value isn't in the destination. There is no destination, at least none that anyone can ever reach. The value is in the journey. And here you have an amazing journey laid out in front of you, from accomplished beginner to a master and a teacher of men. Savor it as you would a novel, study it for the nuances, and then make it your own.

I know I'm not trading the same method that Spydertrader and Jack trade, I'm not even trading what they teach. But by using the principles they teach and learning from their experiences, I have a great system which has worked wonders for me. What's more, I know that I can return to these pages every few months and pull out more gems.


And you would want that distilled? You would lose all of the richness. ......
More...


This is definitely one of the best posts I have ever read in here.
Thank you foible.
 
Quote from dkm:


When price does not proceed in the desired direction after entry, I am then faced with (a) do I reverse (b) do I hold and hope to wash for a breakeven trade, or (c) do I exit with a small loss? Bearing in mind that some time must elapse before one can evaluate the pro rata volume / price action after entry, I invariably find myself whipsawed if I reverse. Exiting with a small loss is fine occasionally but it is fast becoming a habit. Option (b) seems too ambiguous and I don’t like trading on hope.

I would value any constructive practical comments from others who have made progress towards consistently identifying FTTs.
More...

Perhaps I'm not correctly understanding where you are at. It appears to me that you have the identification of a FTT down fairly well, but once you enter from a FTT signal, you are stop managing the trade correctly. From your comment "if price does not proceed in the desired direction after entry" it sounds like you are looking for only one (perhaps two) possibility after the FTT.

A FTT has three possible conclusions - BO, FBO, or FTT. Prepare for each accordingly (anticipate what they would look like volume and price wise) and execute appropriately as it unfolds.

Of course, take everything I say with a grain of salt - I am no expert at ID'ing the FTT's on the futures. I just recognize some of your comments as my own internal dialog.

HTH
 
Heres something I have found that helps quite a bit. Below the excel prv I have the last two fiveminute bars on a Quotetracker chart. These are what QT calls pressure bars. They show the percentage of trades going off at the ask vs. the bid and help to get an idea of whats going on. The last bar is the 2:00 pm bar and you can see that most of the action is on the ask indicating a possible reversal. Like anything else it takes a bit of practice to use them because at times its a contrary indicator as when most of the trades are going of at the ask but price is not moving up.
 

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Quote from dkm:

As price progresses from right to left within a channel, the task is to identify a potential FTT. Assume for a moment that we restrict our tools to channel lines, price bars and volume. Until the high of the current bar surpasses the high of the preceding bar (assuming a long channel), then the previous bar is a potential FTT. As soon as the current bar exceeds the high of the preceding bar then the current bar becomes a potential FTT. By monitoring the volume of the current bar as it forms, we can estimate whether or not its volume will exceed that of the preceding bar. If the pro rata volume is less than the volume of the preceding bar and price has not yet exceeded the high of the preceding bar, then the preceding bar may be an FTT and a trade entry is considered. If the pro rata volume exceeds that of the preceding bar then price is likely to continue towards the left hand side of the channel.

This approach to identifying an FTT means that entry will never be during the formation of the FTT bar and I believe that Spydertrader will often enter during the formation of the FTT bar itself. It does however mean that entry can be considered prior to the low of the potential FTT being broken, which is frequently far too late.

This is how I am currently using channel lines, price and volume to identify a potential FTT. However, consistent successful identification has yet to be achieved. I would be more successful flipping a coin so I can only conclude that I am missing or misinterpreting some vital piece of the decision process.

When price does not proceed in the desired direction after entry, I am then faced with (a) do I reverse (b) do I hold and hope to wash for a breakeven trade, or (c) do I exit with a small loss? Bearing in mind that some time must elapse before one can evaluate the pro rata volume / price action after entry, I invariably find myself whipsawed if I reverse. Exiting with a small loss is fine occasionally but it is fast becoming a habit. Option (b) seems too ambiguous and I don’t like trading on hope.

I would value any constructive practical comments from others who have made progress towards consistently identifying FTTs.
More...

Can you post an example to which you refer ? I think I get your question, I'm not sure I have an answer! :)
 
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