Spydertrader's Jack Hershey Futures Trading Journal

[Tums]

Quote from Ezzy:

As others have mentioned is depends on the software, generally it's close to close. Today I had a bar where both open and close were the same price and lower than the previous close. It is a black bar on my screen and should be red. So there will be minor differences here and there but don't get hung up on them. That is why it's important to look a little loosely at times - at the price movement.

I noted the discrepencies on the Tradestation chart attached. There was obviously some unique bar coding here. The important thing is the concept, the movement of price with regard to the volume.

here the easy language code for the volume. You can import it into your Tradestation program.

 

[Ezzy]

EstebanUno - thanks for posting the volume formations. Hopefully we'll get some answers on that. I have a theory that when we get into congestion or stall where the bars go r-b-r-b-r-b-r-b and there is no dominant, that there is no gaussian and we need to wait for the dominant to show up. We'll see how this plays out.

Mak and EstebanUno, Thanks for the clarity on the gaussians in laterals and slow pace. That is exactly what I was refering to above and finally have a definite anwer, instead of thinking I might be off on a tangent.
Regards - EZ

 

[ivob]

Quote from REB:

"I am trying to get a handle on the gaussian volume patterns. As I see it, there are eight potential patterns (see attached). I think I know what to look for, but I'm not sure what the sequence should be in context with price and volume. I've read the posts, but I'm just not getting it. Any additional help here would be appreciated. Many thanks."

reb

There's a logical explanation behind the gaussians. Understanding this makes it easier to know what to look for and to believe in it.

High volume = continuation of the trend (except when an FTT occurs). People agree this is a good trade (they disagree on direction though). Things go as they are going. Low volume = disagreement = change. I heared Jack saying on one of his videos.

We expect high volume when price hits trendlines and the trend continues. This volume peak may have been an FTT in a smaller channel, however dominant trend is intact.

If we see an FTT, which also has high volume compared to surrounding bars, the next thing you look for is low volume when price goes back to the trendline it just came from. Then we wait for breakout. We still look for low volume during the complete breakout. After breakout and a possible retracement on low volume, volume should pick up in direction of the new trend. This whole process is a gaussian.

Pls comment on this as I may be seeing this completely wrong, I'm just a beginner.



regards,
Ivo

 

[ivob]

Hi all,

I just have a question about exits that others may have as well.

We are supposed to exit on the next FTT after an FTT.

Imagine price traversing from right to left (dominant). We are making money. Price hits LTL and traverses to the right on lower volume. We expect price to hit RTL and then traverse to the left again reaching the trendline or maybe not (FTT)

But what happens is price hits RTL and breaks thru and the trend changes. We are losing money.

Does this mean I missed an FTT or I still have to wait longer?

Or should I have said at LTL let's take some profits?

I know after FTT a BO, FBO or another FTT occurs but is a BO always preceeded by an FTT?

regards,
Ivo

 

[Spydertrader]

Quote from ivob:

We are supposed to exit on the next FTT after an FTT.

The above statement is incorrect. Please see the third post in this Journal.

Quote from ivob:

I know after FTT a BO, FBO or another FTT occurs but is a BO always preceeded by an FTT?

Currently, we watch for an FTT formation before entering. In the example you posted above, you do not wait for an FTT to enter. You entered off a Point Three Formation - trading the dominant traverse of an uptrend. When we reach 'intermediate level' discussions, we plan to alter the FBO (Exit) rule to include reversals both along the LTL and off an FBO.

Nothing wrong with staying a step ahead of the class, but for right now, I want to make sure everyone can follow the FTT's.

- Spydertrader

 

[Spydertrader]

I expect to post an update on the Tucson Meetings, as well as the Video Files to be made available in the near future.

- Spydertrader

 

[billp]

Thanks R/R and Ezzy.

I too same with others have problems reading the gaussian formation.

 

[makosgu]

Quote from billp:

Thanks R/R and Ezzy.

I too same with others have problems reading the gaussian formation.

We have to be very careful. The gaussians are always there. Remember, the gaussian is nothing but simply a single cycle of volume surging and then receding. Staying on the 5M has both advantages and disadvantages. On numerous occasions you find that the spike off of the LTL or RTL or FTT happens within the bar as opposed to the open or close. Ideally, we like to see a prolonged gaussian cycle (ie. where the volume surge and recession occurs over several bars). However, if you look closely, in the regions where the pace/volume is relatively low and prolonged, the surge and recession is cycling over a much shorter period (ie. 2 - 3 bars ~15M). All that this means is that it is more difficult to see gaussian on a 5M fractal if the period of the gaussian is relatively short. This is yet another pace characteristic that some of you are become aware. We always have to differentiate concepts that are rigid (ie. +/-, pt1,2,3) from those that are dynamical. The period of a gaussian is dynamic and is in accordance with the pace. The characterisation is that when the PACE is relatively fast (ie. MEDIUM/FAST/EXTREME), the period of the gaussian is long (ie. 15M-45M). When the PACE is slow (ie. SLOW/DU/VDU), the period of a gaussian is short (ie. 5M-15M). In the VDU territory, you actually have to read the gaussian off the T&S/DOM. The whole point is that LONGER period gaussians are easier to read on the 5M then SHORTER period gaussians. In the future, we will be adding a sub fractal resolution where will do all the same analysis on a subfractal and only WHEN we ARRIVE in these zones. It is a good thing that people are recognizing these characteristics. The recognition of these points is the trigger to look elsewhere for cleaner information. In other words, as we shift paces, we are recognizing how and where to gather additional information based on the current pace.

Regards,
MAK

 

[WGTrader]

MAK,

Thank you for your explanation of the dynamic nature of the guassian cycle length. That was helpful. As I understand it now, when the pace is slow/DU/VDU the gaussian cycle is short. When the pace is fast, the gaussian cycle is long(er). I have noticed that when I chart a longer fractal (i.e. 5 day, 30-min) next to the daily 5 min fractal, the gaussians cycles jump right out! Thanks.

 

[EstebanUno]

A question about LT extensions.

Once an extension is in place, do we continue to extend the original LT and use it again as a LT for FBO and BO analysis, if price falls back into the price range of the original channel? Or do we just have a wider channel now, from RT to LT extension?

I apologize if this has already been asked and answered.