Spydertrader's Jack Hershey Futures Trading Journal
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My understanding is that as soon as you have determined it's an FTT you enter. When this is exactly will depend on several factors including your skill level, experience, and number of tools you're using (right now we're just using channels).
As a follow up to my last post (earlier today) here is an example. On the attched chart I have two possible RTL's numbered 1 and 2. #1 starts from within the CCC. #2 starts with the bar that breaks out from CCC.
Is either 1 or 2 "the" correct way to do it, or is it a matter of waiting for how the channel shapes up.
I admit to having a lot of baggage (bad beliefs) about channel providing data which is too late to trade on. One thing that is becoming clear is that it seems like even though I need to massage my channels often from my first attempt, that massaging doesn't really effect where I'd get into or out of a trade.
Is either 1 or 2 "the" correct way to do it, or is it a matter of waiting for how the channel shapes up.
I admit to having a lot of baggage (bad beliefs) about channel providing data which is too late to trade on. One thing that is becoming clear is that it seems like even though I need to massage my channels often from my first attempt, that massaging doesn't really effect where I'd get into or out of a trade.
forgot attach...
once established, there are three parts Congestion, Convergence, and Centering.... your points are identifying a traverse of the initial Congestion the volume is suggesting a drift downward into Convergence and centering. Once CCC is identified you should be able to draw a lateral channel, this channel is the only type that can have volitility expansions to either direction, making the potential greater to both sides Long and Short. The final part of the CCC is likely to exhibit a penant formation either FTP long bias, FBP short bias, SYM bracket entry. once identified, and depending on the spread deems it tradeable or sideline .... FTT s can occur on either side within lateral, but remember that you are expecting price to come into a centering formation. Volume will give you a heads up when to begin a trend out of CCC.
Hope you find the information useful
EX
This is very helpful and also cause for many more questions (as is the case with helpful info
) But first I'll study what you said, it's a mouthful.Quote from bundlemaker:
This is very helpful and also cause for many more questions (as is the case with helpful info
Here's a link to a diagram which might help to illustrate:
http://www.elitetrader.com/vb/attachment.php?s=&postid=826366
See this post: http://www.elitetrader.com/vb/showthread.php?s=&postid=1311460#post1311460
At some point you determine price is not going to make it to the left channel side. Delicining volume (PRV) is a clue, price reversing is a clue. As Bundlemaker said, depends on your skill, experience and tools.
I would suggest annotating a lot of charts, marking all the FTT's, and seeing what they have in common or look like. You won't have PRV on a static chart, but PRV will help you in real time to ID a change in volume.
Right now you most likely can't ID the top of the FTT bar and make the trade. Things are a bit sloppy. Whether you ID the FTT somewhere on the bar it occurs, the next bar (or two), or use a break of a bar low all will depend on skill, experience and tools. As you get better, you see it earlier. See post referenced above.
Hope this helps. Regards - EZ
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