Spydertrader's Jack Hershey Futures Trading Journal

[Spydertrader]

Quote from Spydertrader:

Along the same line of discussion, I expect everyone to continue the long-standing tradition of respecting the other contributors to the thread. Over the last two years, the discussion has remained relatively flame free providing an environment conducive to learning. I expect that trend to continue throughout this thread as well, and I appreciate everyone’s efforts toward that end.

I have quoted the above text in an effort to remind everyone of the expectations for appropriate behavior required for thread participation. I encourage liberal (and frequent) use of the ET "Ignore" and "Complain" features in an effort to respond to inappropriate commentary. Adherence to the above guidelines should allow for an open and friendly discourse and foster an environment conducive to learning.

Good Journey to you all.

- Spydertrader

 

[AlpineTrout]

This is not meant to be a flippant question, simply a logical one.

We've seen many posts with regard to how important it is to train the brain to think positively before trading a methodology with real money. Dr. Daniel Amen's work with Brain SPECT Images clearly shows how negative thoughts can seen in the brain.

I know this question will be seen as akin to the "show me the prints" type posts, but its truly not meant that way. I'm asking it from the LOGICAL starting point of a training process. If this is truly an altruistic endeavour, and you and Jack are simply "paying forward" (which would be amazing in this business) I ask the following question:

Why not start from the beginning, by showing all students that it can indeed be done, on live video, for 2 or 3 days, that anyone could watch and record? Doesn't it make sense to extinguish any negative thoughts or doubts prior to training?

 

[bundlemaker]

Quote from AlpineTrout:

This is not meant to be a flippant question, simply a logical one.

We've seen many posts with regard to how important it is to train the brain to think positively before trading a methodology with real money. Dr. Daniel Amen's work with Brain SPECT Images clearly shows how negative thoughts can seen in the brain.

I know this question will be seen as akin to the "show me the prints" type posts, but its truly not meant that way. I'm asking it from the LOGICAL starting point of a training process. If this is truly an altruistic endeavour, and you and Jack are simply "paying forward" (which would be amazing in this business) I ask the following question:

Why not start from the beginning, by showing all students that it can indeed be done, on live video, for 2 or 3 days, that anyone could watch and record? Doesn't it make sense to extinguish any negative thoughts or doubts prior to training?

My experience in teaching is that this doesn't work. When negative beliefs exists, you sort of need to "end run" them by actually doing.

 

[Aurum]

Quote from hypostomus:


Here we unwittingly fall afoul of the Hypostomean Hypothesis, which is that the key core rules must perforce test with positive expectation if the supporting supplementary rules are to increase that core expectation to a surety of easy wealth. From a recidivist backtester's perspective, we just accepted two rules (five minutes and 20m SMA). Looking ahead, I will preview for you that when we get to the 1-2-3 rules, we will discover that niggling real-life problem where we have made a commitment at point 3 and point 4 disappoints. Best regards. Mike.

Choosing the 5 minute timeframe isn't a rule per se - it's a way to establish a common framework for the people working on the material here. Most likely the 5 minute was chosen because it's fast enough to get regular feedback, yet slow enough for a human to operate effectively on. Or maybe because "everyone" trades on the 5.

As stated by Spyder originally - this works on all time frames and in all markets (provided sufficient liquidity exists.) If you'd prefer, choose another market and periodicity.

 

[Aurum]

Quote from AlpineTrout:

Why not start from the beginning, by showing all students that it can indeed be done, on live video, for 2 or 3 days, that anyone could watch and record? Doesn't it make sense to extinguish any negative thoughts or doubts prior to training?

It is not the stated purpose (nor, I do believe, the implied purpose) to convince anyone of anything.

If anyone has negative thoughts or doubts, the responsibility for extinguishing them lies solely with the bearer.

 

[makosgu]

Quote from Bearbelly:

I downloaded the video and found it very interesting but did not see any evidence that YM leads ES. Are you sure you got the right date?

In time we will get to this. I have spent a bunch of time in this arena and have a whole bunch of "engineering tools" that quantify this. At a very simple level, you can consider the resolution. For every ONE tick that ES moves, you will find that YM will have moved MORE THAN ONE YM tick. This is a fine resolution item. What you will then need to back out and picture is whether or not the two pairs behave similarly/reliably. Again, there are engineering analytics that can be used... This is months down the line...

Regards,
MAK

 

[foible]

Quote from Aurum:

As stated by Spyder originally - this works on all time frames and in all markets (provided sufficient liquidity exists.) If you'd prefer, choose another market and periodicity.

I think the key is "liquidity" as a stand-in for regularity. Some contracts or equities move far too choppily at the 5 min level so you have to step back or you'll be lost in the noise. A friend who trades forex said that there are so many games played that the 2hr or 4hr are the fastest fractals that he has been able to use consistently. Imagine trading a stock with an avg vol of 45,000 shares/day off the 1min fractal - the bars will be all noise.

The ES is extremely liquid and regular and so it lets us move to a fast fractal with little loss. My current view is that you want to find a fractal that is slow enough for you to feel relaxed and confident and for most of the twitches to disappear, but fast enough for you to have a high money velocity and to respond in a timely fashion.

 

[Magna]

Quote from Spydertrader:

...an effort to remind everyone of the expectations for appropriate behavior required for thread participation. I encourage liberal (and frequent) use of the ET "Ignore" and "Complain" features in an effort to respond to inappropriate commentary. Adherence to the above guidelines should allow for an open and friendly discourse and foster an environment conducive to learning.

Spydertrader (along with a few others) are graciously taking a tremendous amount of their time and energy to attempt something here that few at ET have ever done. I will not allow this thread to become polluted with personal attacks (or diluted with off-topic banter), so if either the subject matter or this style of teaching doesn't suit your needs then please move on to another thread. To everyone else who is genuinely trying to participate I ask that you feel free to Ignore those who bother you (much better than letting them get under your skin), and more importantly don't quote those who are trying to sidetrack the journal. It only solidifies and reinforces the garbage and makes my clean-up work more time consuming. Other than that use the Complain feature, or for faster results please send me a PM. With all that said, best of luck to everyone here.

 

[Aurum]

Quote from foible:

I think the key is "liquidity" as a stand-in for regularity. Some contracts or equities move far too choppily at the 5 min level so you have to step back or you'll be lost in the noise. A friend who trades forex said that there are so many games played that the 2hr or 4hr are the fastest fractals that he has been able to use consistently. Imagine trading a stock with an avg vol of 45,000 shares/day off the 1min fractal - the bars will be all noise.

I've always understood the statement to be an IF...THEN construct. IF sufficient liquidity exists in the given market on the given timeframe, THEN the FTT works (on that timeframe.) I see via your comments that someone could take the original statement to mean something else (e.g. if there is sufficient liquidity in a market, the FTT will work on any timeframe in that market - not true.)

 

[hypostomus]

Spydertrader. Thank you kindly for the examples. They raise two questions which no doubt reveal my ignorance of the gospels. In a possible downtrend, you seem to be waiting for a red bar before you draw the right side, and vice versa for an uptrend. Similarly it appears that you do not declare an FTT in an uptrend unless the bar is red and vice versa. Rules, or just accidents of the examples?

My question about the 20 SMA was not meant to be flippant, I assumed you were going somewhere with it, and when to start it is a rule. Best regards. Mike.