Spydertrader's Jack Hershey Futures Trading Journal

Status
Not open for further replies.
Quote from river:

I’m hoping someone would critique my thought process on a point 3 channel I redrew/adjusted on this morning’s ES chart.

My original channel used bar 9:40 as point 1, bar 9:50 as point 2, and 10:10 as point 3. Using January’s tools, I concluded “continuation” for each subsequent bar including the 10:35 bar which crossed my RTL. Using PRV and Gaussians I concluded it was most likely a flaw and I should “hold”—in other words—“continuation”—even though the RTL was violated. I then adjusted my channel using the 10:35 bar as my point 3.

Here’s my question: Was my thought process ok? Under what conditions, if any, is it alright to “hold” through a RTL violation?

-river
More...
river,

Since I was doing the "Continuation/Change (NOC/CHG) at Bar Close Drill", I watched the 10:35 bar BO my RTL and then fall back/close in the channel. Since the close was in the channel, my decision was NOC or Continue. Sure, price could have continued going higher but I was anticipating a retrace due to the 10:30 Gaussian peak and the overall pace of the short channel.

But then I asked myself what I would have done if I wasn't doing the drill? Would I have exited the Forest RTL upon BO intrabar? Other Forest traders, what did you do here? This peaked my interest a bit so I decided to pull up a replay and take another look.

Attached is a .zip file that contains 10 screens of this time period. Unzip these into a temporary directory and use the Picture/Fax Viewer or some other app that allows you to view large .png files in a slideshow.

A few notes on my app: my STR/SQU uses 2 min bars as I like to sync them up with the YM. The upper and lower bands are quite a bit furthur away than +/- 2 as I'm interested in the spikes at this leg of the journey. The blue ghost volume bars are PRV. To the left of the volume pane is my "5 second volume bars". This is OT and an invention I decided to leave in. I'm trying to analyze this time period at the Forest level but you'll notice some stuff in these other panes. Spyder, I apologize in advance for the OT stuff.

screen 1: Forest channels in place and the 10:30 bar is a "candidate" FTT. Note the decreasing ES R2B peak. Current ES PRV is similar to last bar, for now anyway. Also note that the YM is in a lateral. I think this might be important in the context of NOC/CHG.

screen 2: Price is at the RTL's and STR/SQU signalled a big spike. PRV has decreased a bit on both. Retrace as anticpated. Using a strict interpretation of the Forest Guidelines, one might exit upon BO? But using NOC/CHG might keep one in longer?

screen 3: BO. PRV is still a bit lower than the previous bar and price is still in the YM lateral. Exit here? Or are we in a Forest retrace? A this point, I think the only CHG signals are the BO and the STR spike. But if the pace of the channel is slowing, this could be normal, right?

screen 4: YM PRV increased. Is this enough info for CHG? Price is back on the ES RTL.

screen 5: YM closed in the channel (kinda a spike bar) so I fanned the RTL. Still in the lateral. Not much change on the ES.

next few screens: note that price moves up and down in the 10:35 ES bar but closes within the channel. At this point, I fan the ES RTL. STill in the YM lateral.

screen 10: increasing red comes back in and forms the beginning of another R2B.

For the interested reader, check out the decreasing black spikes in the ES "5 sec vol bars" pane. Do these decreasing spikes/peaks show CHG or NOC? I haven't coded up th OTR chart at this point but I assume it might show a similar pattern, dunno. But this could be drilling down too far.

Anyway, I haven't really answered your question but I thought I'd share what I went thru this evening. If I wasn't doing the drill, I haven't been able to convince myself that I would have held thru the BO and STR spike intrabar. But I'm still debriefing. Any thoughts/comments anyone?

FWIW,

spooz
 

Attachments

Quote from makosgu:

Honestly, you are going to be disappointed. Losing ticks?
More...

Thanks for your posting Mak.

Just to clarify. That was not what I was trying to say.

I wrote:

"This means theoretically we can enter just one tick away from the optimal entry.."

And I mean:

"Wow!"

Not disappointed about anything.

regards,
Ivo
 
Quote from spooz_trader1:

But then I asked myself what I would have done if I wasn't doing the drill? Would I have exited the Forest RTL upon BO intrabar? Other Forest traders, what did you do here? This peaked my interest a bit so I decided to pull up a replay and take another look.
More...

I was simming this and made numerous errors in the period in question.

1. I was long from 10:34 at 1434.75. It was a good entry near what I thought was the FTT.

2. Next bar I saw decreasing black - good. BUT it also was a TL BO. This is not good - it means my channels are wrong. (Didn't think quickly enough in real time though).

3. I held my long convinced I had an excellent entry near P1. Oh shit - the bar is going red. But still it closes as decreasing black. All is well apart from that pesky BO that shouldn't have happened yet.

4. 10:40 bar starts well with increasing black - so was I right to hold? No. This increasing volume is in the context of the real short channel - and sure enough it continues short.

I reversed to short finally but gave up all my profits in the misidentified FTT excursion.

Review

What happened? The channel was incorrect. Redraw with P1 at top of 10:10, P2 at 10:15, P3 at 10:35 (the problem bar). Now we see that the FTT was nothing of the sort in the revised channel.

Take-away: you cannot have a TL BO on decreasing volume.

I hope that helps someone.
 
Quote from spooz_trader1:

river,

But then I asked myself what I would have done if I wasn't doing the drill?

spooz
More...

If things are not clear to me I always wait for the current bar to finish and then ask myself the same question (continuation or change). So if you are not sure, just wait. If you take the trade and price goes a little against you, just ask yourself the question if anything else has changed except for price. (price is just one data element).

If I think "now this really is a FTT candidate" or "this could be a BO" then I check finer tools if we are still in the same bar.

Regarding your screenshots: IMO price never broke out. I would wait for price to be a few ticks above the high in that square area on YM (I think it's the 10:32 bar) assuming price already broke the RTL on ES. There we need incr. PRV.

Anyway, just look at the big picture. The move to RTL is just sideways on decreasing volume. No sign whatsoever there will be any change.

Anyone feel free to correct me.

regards,
Ivo
 
Quote from makosgu:

The idea is to know and be comfortable with what the picture looks like at each resolution. This is why I commented about how 2pairs look like on flags. When the DOM finally came around, it was immediately apparent to Jack what the two pair must look like on DOM with respect to liquidity (minority). I long for the day when some tool eventually shows us the full DOM queue on all 4 sides instead of just 2.

MAK
More...

MAK,

What is Minority? and when you say "4 sides instead of just 2", what 4s?
Thank you.

Eric
 
Quote from ericta:

MAK,

What is Minority? and when you say "4 sides instead of just 2", what 4s?
Thank you.

Eric
More...

Let me take a stab at it based on these I've read Mak say previously. The minority comment is simply the fact that the smaller side of the DOM is in control.

The 4 sides is really cool IMHO and how I've thought one should see the market for a long time now. Almost the entire world looks at a bid/ask market and see's demand and supply. What they are missing is that in any (futures) market there are actually two products which each have demand and supply. THere is demand and supply for longs, and demand and supply for shorts.
 
Quote from PointOne:

Review

What happened? The channel was incorrect. Redraw with P1 at top of 10:10, P2 at 10:15, P3 at 10:35 (the problem bar). Now we see that the FTT was nothing of the sort in the revised channel.

Take-away: you cannot have a TL BO on decreasing volume.

I hope that helps someone. [/B]
More...

nice review, helps alot.
 
Quote from bundlemaker:

Let me take a stab at it based on these I've read Mak say previously. The minority comment is simply the fact that the smaller side of the DOM is in control.
More...

and we are looking for the wall (the majority side) in DOM because...?

Quote from bundlemaker:


The 4 sides is really cool IMHO and how I've thought one should see the market for a long time now. Almost the entire world looks at a bid/ask market and see's demand and supply. What they are missing is that in any (futures) market there are actually two products which each have demand and supply. THere is demand and supply for longs, and demand and supply for shorts.
More...

how do we differentiate the demand from long and the demand from short? Can we analyze it from current data set (eg. DOM and TIC )?

Thank you bundlemaker.
 
I just find out a way to tell whether I'm anticipating or predicting. it's 100% accurate for me.

anxious, stressed, or "YES, I knew it's going up"...

The way spyder and Jack anticipate should be stress free. tired maybe, but not emotions.

BR.
 
Status
Not open for further replies.
Back
Top