Spydertrader's Jack Hershey Futures Trading Journal

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I have a question about a scenario from Tues Jan 29th. The chart is attached.

Based on the three pieces that I annotated (R\/R, #1, #2). I've concocted the following scenario. Hopefully someone can comment on whether I have the right thinking or am totally off.

I see the R\/R fully develop on the ES 5min at 1:00pm EST. At this point in time, we want to get short (I assume). This is where I noted #1. After a full retrace back to the RTL, we see a strong BO of the RTL. Pace is very fast after this BO.

My question is, did the R\/R at point #1 not ONLY signal our short but ALSO tell us that we would not get a bounce off the RTL (#2) but rather a BO of the RTL and that we should hold at #2, catching the BO and profiting nicely?

(Sorry, R\/R is misannotated on the chart)
 

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from spyder post right before your post


Quote from Spydertrader:

... a \/ - R2R allows a trader to anticipate market turns, ...
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Quote from Steve Tvardek:
....
My question is, did the R/\R at point #1 not ONLY signal our short but ALSO tell us that we would not get a bounce off the RTL (#2) but rather a BO of the RTL and that we should hold at #2, catching the BO and profiting nicely? [/B]
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there are several bars between #1 and #2, your job is "anticipate what happen next...(bar)" given the tools at hand.
 
Yeah, I read that and it got me thinking about this scenario and I hope that Spyder might comment on whether this example is what he meant by that or not.


Quote from nkhoi:

from spyder post right before your post
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Quote from Steve Tvardek:

I have a question about a scenario from Tues Jan 29th. The chart is attached.

Based on the three pieces that I annotated (R\/R, #1, #2). I've concocted the following scenario. Hopefully someone can comment on whether I have the right thinking or am totally off.

I see the R\/R fully develop on the ES 5min at 1:00pm EST. At this point in time, we want to get short (I assume). This is where I noted #1. After a full retrace back to the RTL, we see a strong BO of the RTL. Pace is very fast after this BO.

My question is, did the R\/R at point #1 not ONLY signal our short but ALSO tell us that we would not get a bounce off the RTL (#2) but rather a BO of the RTL and that we should hold at #2, catching the BO and profiting nicely?

(Sorry, R\/R is misannotated on the chart)
More...

Steve,

Your point 1 is actually an FTT of a channel which you do not have annotated. For this method to work it is critical that all pertinent channels be annotated on your chart. The red to red which confirms the new down trend happens right after the point 1.

The sequence is: FTT, decreasing red volume back to the right trend line, and increasing red volume as price break out downward beyond the right trend line. This is of course an idealize description, but with some effort it's pretty easy to see.

The ideal entry is the earliest possible ident of the FTT. Enter short when you think you have an FTT. What you will find is that by entering when you think you have an FTT, even if it wasn't (a flaw, a what wasn't that) you can more times than not salvage a small profit and then immediately get yourself back on the right side of the market as soon as you realize you erred.

Hope this helps.
 
Quote from bundlemaker:

Steve,

Your point 1 is actually an FTT of a channel which you do not have annotated. For this method to work it is critical that all pertinent channels be annotated on your chart. The red to red which confirms the new down trend happens right after the point 1.
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You can still see the FTT (point 1) even with the laid back major channels Steve has drawn.

Sequence:
FTT - retrace - X2X confirms - BO

Counter-intuitively Point 1 is a relatively safe place to be, as you explain.

:)
 
After having a tough time today, I just took time to do the debrief tonight and dress up the chart. Here is my final draft. Of course, my skill level isn't quite this good live during the day. Please post any comments that can help me improve the process.

Sometimes the QT program I am working on drops off some of the volume gaussians but most should be there.
 

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I agree that my chart isnt fully annotated the way it should be, I do realize that #1 on the chart is an FTT of the carry over channel from the previous day (the way I drew it at least, which is to say it may not be correct :) ).

Regardless though, I want to make sure my understanding of the situation that unfolded is on the right track. The FTT (#1), in addition to the R\/R that forms gives us our short position, then we get a retrace back to the RTL. Now, since we get a BO of the RTL, we hold as we are already on the correct side of the market. Prior to the BO, I dont see anything significant volume wise to be able to "anticipate" that a break of the RTL would occur so I am hoping that the R\/R in this case signalled this? Maybe its a case that would require medium and fine analysis as well, and since we arent there yet, this question cannot be answered yet?
 
Quote from Steve Tvardek:

Prior to the BO, I dont see anything significant volume wise to be able to "anticipate" that a break of the RTL would occur so I am hoping that the R\/R in this case signalled this? Maybe its a case that would require medium and fine analysis as well, and since we arent there yet, this question cannot be answered yet?
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Hold until the next FTT.

Was there a FTT of your short channel prior to the BO? Just eyeballing your chart it looks like there were a couple of hitches in a row (a stall) which may have caused concern, but other than that the channel was being traversed flawlessly all the way to the BO and R2R.
 
Thanks :)

Quote from PointOne:

Hold until the next FTT.

Was there a FTT of your short channel prior to the BO? Just eyeballing your chart it looks like there were a couple of hitches in a row (a stall) which may have caused concern, but other than that the channel was being traversed flawlessly all the way to the BO and R2R.
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Catching up...

ES 5M 01.29.07 chart...

2:20+ was an absolutely pain on the 5M (ie. considerable skill)... :cool:

<img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=1345113>

Regards,
MAK
 

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