Spydertrader's Jack Hershey Futures Trading Journal

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Esteban,

I don't have a problem with the gray dotted channel in this chart. It's in a larger down channel, coming after/during a non-dom traverse. Bar 9 heads lower on what appears to be increasing red and the start of a new gaussian. Bar 10 changes all that and it's out the window, but at that point on this chart it looks reasonable.

I didn't have that channel because my data was different. Bars 2,6 & 8 on my chart had the same highs, and the YM didn't really support that channel. But based on what was on your ES chart I would have drawn it in temporarily as well.

Two things that might have given a bit of caution with it. Bar 4 FTT (so we're anticipating a new point 3 for the up-channel), and the fact that bars 7,8, & 9 were all inside of bar 6.

Just wanted to give a different view.

Regards - EZ
<img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=1465001>
 

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Quote from EstebanUno:

Very good point. I saw it the same way. But I have to admit that these weak price advancement bars on higher volume can be tricky. Had that bar closed 1 tick lower (lower than the 2 prev bar lows) I would have been thinking r2R.
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Mmm. it's really not about 2 ticks higher or lower, it's about the trend and about PRV. within the bar itself a lot can happen. There can be extreme buying and then a littlebit of selling and the bar still ends lower. Especially on 5 min bars. Just check PRV + YM + str/sq while the bar is being formed.

The next bar, 10:10, had strong price movement on declining volume.

Really? I just remember I saw buying. I recorded it so will check it. The total volume of this bar may not have been amazing but you have to see the volume in relation to the length of the bar. There's an FTT and price breaks out and volume increased after the breakout. All information is there to hold.

if price moves laterally I don't know which side of the market represents continuation, so I don't know whether to hold through lateral movement or not.

Checkout where price went into the lateral and then it should come out on the other side providing nothing 'happens' inside the lateral like a FTT.

regards.
Ivo
 
Ivo, please understand that I'm not disagreeing with you here. Notice that my chart also showed FTT and I also held through the area in question. I often see low vol reversals after FTTs, and was using this example to point this out, and hopefully to learn where it is that one expects increasing V when it does not occur on RT BO as expected.

Quote from ivob:
Mmm. it's really not about 2 ticks higher or lower, it's about the trend and about PRV. within the bar itself a lot can happen. There can be extreme buying and then a littlebit of selling and the bar still ends lower. Especially on 5 min bars. Just check PRV + YM + str/sq while the bar is being formed.

Obviously you are working on a much finer resolution level than I am. On the resolution I was following (Es 5min) I think where the bar closes IS important. In this case it was a failed BO. 1 or 2 ticks lower it is a trending bar on increasing V. YM shows much more vol on down than up, BTW. (See attached YM snippet and red annotation.)

Quote from ivob:
The next bar, 10:10, had strong price movement on declining volume.

Really? I just remember I saw buying. I recorded it so will check it. The total volume of this bar may not have been amazing but you have to see the volume in relation to the length of the bar. There's an FTT and price breaks out and volume increased after the breakout. All information is there to hold.

I guess this is exactly type of area where I should be looking at YM. I didn't. In hindsight I did not find it helpful. There was a r2R then rev to black FTT followed by low volume BO of RT. It's the low volume BO that is not as expected.

I've attached YM for the time in question, with my annotations.

All the best,
Esteban
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Hi,

I was trying to organize what I know and my trading strategy for trading at the Tree level (FTT to BO or FTT).

I don't know if we are qualified with the set of tools available now to really trade at this level, but if not, please just tell me.

I leave here my conclusion for your critic. It is a set of actions for trying to focus all time on the Ball :

ENTER at FTT:

IF price is near LTL:
-- Expect "Decreasing NonDom Volume" until RTL
-- EXIT (or REVERSE) if +PRV Dominat (FBO)
-- Expect "Point 2"
-- It should be a Tape FTT from "Point 1"
-- Watch YM
-- Expect YM Tape FTT
-- Expect «Retrace» to "Point 3"
-- Anticipate price area of pnt3: Pnt2 < Pnt3 < Pnt1
-- It should be a Tape FTT from "Point 2"
-- Watch YM
-- Expect YM Tape FTT
-- Expect significantly Low Volume exactly near RTL
-- Expect BO "Increasing old ND Volume" in New Channel
-- EXIT (or REVERSE) if +PRV Dominat (FBO)

-- EXIT on FFT or BO

ELSE IF price is near RTL:
-- Expect "Decreasing ND Volume" until RTL
-- Expect significantly Low Volume exactly near RTL
-- Expect BO "Increasing old ND Volume" in New Channel
-- EXIT (or REVERSE) if Dominat +PRV (FBO)
-- Expect "Point 2"
-- It should be a Tape FTT from "Point 1"
-- Watch YM
-- Expect YM Tape FTT
-- Expect «Retrace» to "Point 3"
-- Anticipate price area of pnt3: Pnt2 < Pnt3 < Pnt1
-- It should be a Tape FTT from "Point 2"
-- Watch YM
-- Expect YM Tape FTT
-- EXIT on FFT or BO


Regards,
Pedro
 
Quote from EstebanUno:

I often see low vol reversals after FTTs, and was using this example to point this out, and hopefully to learn where it is that one expects increasing V when it does not occur on RT BO as expected.
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What we have after FTT's is IMO (but I'm just a beginner) a non dominant left to right traverse. Just like price would normally traverse from left trendline to right trendline but now from an FTT.

What we need is decreasing non dominant volume. (again , just like a normal left to right traverse without the FTT).

So it's true this can be low volume and getting lower and lower. Low volume = disagreement. No one wants to buy and no one wants to sell so price has to go to another area so people feel like buying and other people feel like selling again and the whole process continues. So you are right about the low volume but only before the break of the right trendline. I am actually worried when I see high volume before the trendline. High volume means continuation (within the channel). Sometimes we do see higher volume before breaking of the trendline but I noticed this is usually after a faster trendline within the channel was broken and price still remains in the main channel.

The best breaks are IMO the subtle ones that seem unimportant as if the line was not even there. (and in fact that is the case). Price moves thru a few ticks.... stalls.... (wait before entering if you intent to do so)...goes back two ticks to shake out weak hands. Then moves up again to same level. One tick higher and we enter. Rigth before, right after or right at that moment str/sq also gives a signal.

But after breaking the trendline volume should really pickup.

Obviously you are working on a much finer resolution level than I am. On the resolution I was following (Es 5min) I think where the bar closes IS important.

We all work on 5 min ES and 2 min YM. Where the bar closes is important but this does not depend on 2 ticks. Imagine, there is 5 minutes of time in a bar.... There can be retracements within the same bar.

Of course it all depends on the context. If we have 3 bars in a row of 4 ticks height and on each bar price closes 2 ticks lower and the high of each bar is two ticks lower, yes then it's important because there's a downtrend. On HVS I could care less if price closes two ticks lower or higher.

And as I said, you got to check YM because YM:

- leads ES so tells you what's gonna happen on ES on important moments
- is a 2 minute chart and thinner traded (so moves faster) so more finetuned.
- moves 2 points when ES moves 1 point (finetuned)

Furthermore you have to check PRV while the bar is being formed. Anyone pls correct me if I'm wrong here.

I guess this is exactly type of area where I should be looking at YM.

Yeah well. After the breakout you could just lean back and wait for point 2, point 3, possible FTT after that etc. But yes, you have to look and annotate YM. You don't use YM at all?

regards,
Ivo
 
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