Spydertrader's Jack Hershey Futures Trading Journal

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As time passes the value of each line goes up.

Imagine the youngest age of a person who could draw the lines and have them totally working on a computer in the back of a classroom.

It's like having your son playing with the neighbor at age 5 in Switzerland and having him have trouble explaining in English how he and his buddies herd the dairy cows in for pm milking. He is doing it in "switzedutch".

We are learning to write the language of the markets here and it is a continuing case of iterative refinement bar by bar. Turn your curiousity loose.
 
Quote from dkm:

That seems reasonable. I just didn't spot it at the time :)
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Fair enough. This is the first day that my charts look similar to the rest, so that's encouraging. I need some serious help with my gaussians still, however.... but I just started those, and I'm sure they will come.

Thanks!

TNG
 
Quote from makosgu:



...snip...

Bar 7...
This bar actually started with INCR PRV and then migrated to DECR PRV...
From it's open, I am looking to see whether or not it will extend the LTL. From the open, it doesn't extend the lo of bar 6. I am on alert because the pace is extreme which means the bar is likely to have large volatility. I watch and having not acted on the possible bar 6 FTT, my fall back is a XO of the RTL. As soon as it XOs, I annotate that S1 is over and I plug in my pt1 for S2. Despite being caught off gaurd by the DECR PRV, I am still on the RIGHT SIDE by MONITORING the XO of my RTL... The top of bar 7 is my current pt2 and I am looking to see whether bar 8 will extend it or retrace it to give me pt 3... I want to be comfortable that L2 is a LONG and not a LATERAL/PENNAT so I am on alert...


continued...
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Bar 8...
a. P extends hi of bar 7
b. -PRV
Although I get my bar extension, I do not like the V play. With -PRV, I would have expected the bar NOT to extend the hi of bar 7. Instead I was immediately expecting bar 8 to start retracing. I was expecting bar 7 to give my pt2 and bar 8 to working its way to pt3. Nonetheless, I am still on the right side of the L2 channel so keep up with the play action. I was expecting that my pt2 was on bar 7 but instead I'm getting it on bar 8. Either way, I knew what to expect next...

Bar 9...
a. P extends lo of bar 8
b. -PRV
It is as I expected. Retrace on -PRV. Before Bar 9 closes, I gain confidence that bar 8 is my pt2. Now what about pt3. I did take note of the fact that intrabar, there is a sizeable bounce back from the lo. I note that I may have pt3. On bar 10, I am expecting -PRV to push the retrace furthur. A lateral is still in the cards if the retrace goes as far as my pt1.

Bar 10...
a. P does not extend the hi or the lo of previous bar
b. -PRV
I noticed that I got my -PRV but it does not extend the retrace. The action remains inside of the previous bar. For me it is enough to establish that I am not in a lateral. At this point, I expect the next bar to be +PRV. Reason being is that I established my pt3 is now on bar 9. From here, I expect the DOMINANTS to take over and traverse to the LTL. To do this requires +PRV and an extension of the hi of this current bar.

Bar 11...
a. P extends hi of previous bar
b. -PRV
The bar begins with an extension but the extending does not continue. Additionally my PRV is negative. All is not well and something has shifted. Mid bar, I notice that my PRV continues to fall. The -PRV clues me in that an FTT is in this current card which I note. So now I know one of two things is gonna happen NEXT since I am bordering on the RTL and the bar is RED on -PRV. Either I will BO or resume the traverse. If I get +PRV supporting the BO, I will plug in my pt1 and annotate the FTT of this current bar. If I get +PRV supporting the resume, L2 continues.

Bar 12...
a. P extends lo of previous bar
b. +PRV
Shortly into the bar, I note +PRV in addition to an open that XO my RTL, I immediately annotated my pt1 and got to work annotating channel S3. Midbar I note that the +PRV is only marginal. This shows that the current channel has had a weak beginning. Nonetheless, a surge of +PRV is possible on the next bar which I would expect to extend the current LO of this bar. By the end of the bar, I note that I closed away from the LO and so I annotate a tentative pt2. If i get considerably +PRV, I expect the pt2 to be pushed furthur out. If i get -PRV I expect to be retracing to my pt3. Additionally I am on alert that the current volume of the last several bars is considerably smaller than S1 and L2. At this point, I wasn't sure if I was in a lateral or a short. Pt3 will tell all. I am also wondering why volume has subsided, It's only 11.


<img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=1320549>
 

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Quote from makosgu:

.. At this point, I wasn't sure if I was in a lateral or a short. Pt3 will tell all. I am also wondering why volume has subsided, It's only 11.

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ah! the suspense is killing me:eek:
 
Quote from RedDuke:

Hi Spyder,

Great thread and monumental effort. Huge thanks to you and others.

It has been mentioned many times on this thread the importance of price and volume. The question that I have is why not use volume bars which give the purest combination and price action and volume instead of fixed time fractal.? All other rules the same.

Thanks,
redduke
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Yes, I too would like to know the answer to this one. I don't know about the "pure" bit but my wholly subjective impression is that constant volume bars tend to be better for drawing trend channels than constant time bars.
 
Quote from dcraig:

Yes, I too would like to know the answer to this one. I don't know about the "pure" bit but my wholly subjective impression is that constant volume bars tend to be better for drawing trend channels than constant time bars.
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Personally, IMO, the purest is true DOM bars. Range bars come close but they could be better even when they are set to the Bid/Ask difference. If RANGE bars would plot the BID/ASK SPREAD and use the T&S volume for the RANGE, it would be perfect. The problem with Volume bars is unfortunately, we need to fix our volume measurements to a consistent time interval. Additionally, we do volume projections for the same interval continually. The equivalent for a volume bar would be a projection of when you expect the volume bar to be full (ie. the projection of how long it would take to fill a fixed volume threshold). In the lunchtime hour, it may take a very long time. All the while, you will see drifting within the bar as the volume is filling up. There is no benefit perse, however it would require some mental recalibration. My only strong argument is that at purest, truly the market requires volume to move. Since the market actually moves BID/ASK PAIR by BID/ASK PAIR, having constant volume does not correspond to the PAIR changes directly. This is because you have to fill the size of the BID or ASK before you get a new BID/ASK PAIR. This is why all the folks who say P leads V are dead in the water. If this were the case, you wouldn't know EXACTLY how much volume is need before you get a new BID/ASK PAIR at ALL TIMES!!!

Regards,
MAK
 
MAK and Aurum,

Thanks for the explainations, I was reading the volume/volatility chart wrong and see it clearly now. It is as I expected, for some reason the layout didn't click at first. The "out of whack" data wasn't on your chart - meaning the chart data isn't out of whack. The anomaly referred to shows up at a couple of the "ends" in the chart, but that's a topic for another time.

Thanks again - EZ
 
MAK,

your bar-by-bar comments are very helpful. Can you in addition explain where do you execute trades? I ask you that because bar-by-bar monitoring can imply overtrading for novice.
 
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