Spydertrader's Jack Hershey Futures Trading Journal

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Quote from TraderD72:

Why is the 2:20 pm bar NOT an FTT of the blue or olive channel on Spyders chart?
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Great question.

This is one of those occasions where people normally note the similarities (increasing Price with decreasing Volume indicating a change signal), but fail to observe the subtle differences between what they now observe and what they believe they observed before.

Note the closes of the Price Bars during this time (14:10, 14:15, 14:20). Note also the decreasing black Volume. Decreasing Black Volume in an Up Channel indicates Lateral movement. Price, as expected, is moving laterally (don't just focus on the Highs). Lateral Movement in an up channel is not an FTT - See Harmonics.

Also, the blue channel basically ended when we had a Point Three materialize (fanning which created the Olive channel). While the trend did not change, the channels which contained the trend did.

I hope you find the above information helpful.

- Spydertrader
 
Quote from ericta:

Does anyone here reach the sufficient expertise level to navigate those difficult period and be so kind to demonstrate the moment and the tool which gives you the clue?
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1. Walk through each bar using the End of Bar decision to determine continuation or change. Anything within a formation means hold and any FBO means the same thing.

2. Look at the YM chart to 'see' if any clues exist which may have told you in advance which action to take (hold or reverse) based on your assessment of continuation or change. Match the time where you received the signal from the YM and note the location of the ES.

3. Review your information from Str-Squ (scroll back) to see if any signals developed during the time frame in question, and more importantly, did those signals develop when the ES or YM sat at their extremes. What information did the STR-SQU signal provide? What action would one needed to have taken based on those signals?

4. Next check your DOM Data to note any walls which may have developed during that time frame and note how Price behaved when encountering a wall. Did the wall disappear? How did Price react when the wall disappeared? Did the wall hold firm? What did Price do next?

5. Review the OTR chart in an effort to 'see' what clues materialized with respect to the 2-pair paradigm. Did you see translation after a 2 pair spike? Did you 'see' the increased time spent on the dominant side after the two pair switched dominance? How did the Gaussians on the OTR clue you in to a change in sentiment?

I hope you find the above information helpful.

- Spydertrader
 
Quote from Spydertrader:

Great question.

This is one of those occasions where people normally note the similarities (increasing Price with decreasing Volume indicating a change signal), but fail to observe the subtle differences between what they now observe and what they believe they observed before.

Note the closes of the Price Bars during this time (14:10, 14:15, 14:20). Note also the decreasing black Volume. Decreasing Black Volume in an Up Channel indicates Lateral movement. Price, as expected, is moving laterally (don't just focus on the Highs). Lateral Movement in an up channel is not an FTT - See Harmonics.

Also, the blue channel basically ended when we had a Point Three materialize (fanning which created the Olive channel). While the trend did not change, the channels which contained the trend did.

I hope you find the above information helpful.

- Spydertrader
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Yah. Price failed to close below the low of the 2:20 bar. I missed that and as well I see your point re the decrease in black volume in an up channel. It is indeed a lateral movement, not an FTT or a [1-3/2] up channel with reduced slope.

lj
 
Quote from Jander:

I guess the practical application of my question is when do you reverse? .. surely not as soon as you realize the VE is on lower volume. I can find 5 examples of these that did not result in change today
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Without exception, Decreasing Volume on Improved (in a downtrend, dominant Volume increases as price decreases) Price represents a signal for change. Now, lets look at the types of change which might materialize.

1. Lateral Movement (Price closes within the previous bar)

2. Flaw or Formation (short term change)

3. Non-dominant retrace (FTT, LTL Bounce)

Are you sure your "five examples" don't fall into the above three categories?

- Spydertrader
 
The RTL / LTL notation is correct: it is a retrace in the green channel. It just happen that its slope is up. You have to see what it make sense, and not to follow some rule that you think is correct but you don't understand. On the other hand it is always possible for two traders to draw channels and / or gaussians differently, but they should eventually reach the same conclusions. As an example look at how Jack and Spydertrader fan out the RTL.

So the RTL / LTL and the channel are correct in my view. It may not be in the way you annotate.
Quote from ljyoung:

Is the "RTL/LTL" labelling on the chart correct? I don't think so and it would seem then that the bar in question could be an FTT if the other channel is correct.

lj
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Two of the believes I base my annotations on:

For every correctly drawn channel there is a higher fractal channel in which the first channel is a traverse, dominant or non-dominant. Containers in containers in containers ...

Every correctly drawn gaussian has its two slopes of different color. Sometimes on the fractal we monitor there are intra-bar sentiment changes that can't be seen, but they exist.
 
Yes Spy, the 2:20 bar in hindsight shows lateral movement but while the market is moving in realtime, I do not see why selling into the 2:20 isnt the right play. We cannot know that the bar will close where it did if we took a trade prior to that happening.

Personally, I sold into the 2:20 bar, and held once I saw the next bar form inc vol taking it lower at 2:25. The following bar after that I anticipated a BO of my upchannel but when it FBO'ed I got out for +1.5 pts profit.

So, the way I see it, it could also be an FTT followed by an FBO no?

Quote from Spydertrader:

Great question.

This is one of those occasions where people normally note the similarities (increasing Price with decreasing Volume indicating a change signal), but fail to observe the subtle differences between what they now observe and what they believe they observed before.

Note the closes of the Price Bars during this time (14:10, 14:15, 14:20). Note also the decreasing black Volume. Decreasing Black Volume in an Up Channel indicates Lateral movement. Price, as expected, is moving laterally (don't just focus on the Highs). Lateral Movement in an up channel is not an FTT - See Harmonics.

Also, the blue channel basically ended when we had a Point Three materialize (fanning which created the Olive channel). While the trend did not change, the channels which contained the trend did.

I hope you find the above information helpful.

- Spydertrader
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Quote from The Swordsman:

Yes Spy, the 2:20 bar in hindsight shows lateral movement but while the market is moving in realtime, I do not see why selling into the 2:20 isnt the right play.
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Nothing wrong with 'seeing' things differently. We all should see events a bit different than the next person. As long as we arrive at the same endpoint, no harm is done. However, suggesting the information I provided exists only in hindsight means you missed something along the way.

Did the closes of the bars line up "in hindsight" or did they line up in real time? Unless your charts mysteriously change the close at the end of day, I suspect all this happened in real-time, and not as you suggest. Call the whole thing a goat if you like, but whatever one decides to 'name' the event, doesn't change what the event actually is - lateral movement. Had you decided (in real-time) that you did not see lateral movement, then I recommend at least considering the possibility lateral movement existed when decreasing black volume in an up channel materializes the next time you see it, else, you might find yourself upside down on the wrong end of a rocket.

Secondly, figure out which resolution you want to trade on, and then use the appropriate tools to capture the signal. If you want to trade Intra-Bar, then you need to be prepared to have anticipated incorrectly by the time the close of the bar arrives. When a bar closes inside the previous bar, as opposed to closing outside the previous bar, I recommend viewing such a circumstance as a difference, and not (as you appear to be suggesting) as a similarity. The converse of this is, if you want to trade End of Bar, then one has to be prepared to give up profits in order to wait for the time well after when "you know that you know."

Lastly, please point out where I posted "selling here wasn't the right play" because I do not recall saying anything of the kind. I simply pointed out what formation existed and what such a formation means to the vast majority of individuals trading. Now, if you want to trade within such formations, nothing stops you from doing so. After all, you appear to have made out just fine in this circumstance. However, I recommend disassociating 'right' and 'wrong' from that of market direction as soon as possible. It's a slippery slope straight down from needing to be 'right'.

Good trading to you.

- Spydertrader
 
Good morning everyone,

I spent some time last night writing an indicator to auto-annotate the internal formations on the chart. I started rather late last night, so I only finished outside bars, symmetric pennants, FBP, FTP, and CCC formations. The attached shows yesterday's and today's action with the indicator.

Jack stated that the translation of these annotations to computer code is direct and mechanical, and he was right. Fairly simple to implement. If anyone is interested in how I created the indicator, please PM me.

RT
 

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