Spydertrader's Jack Hershey Futures Trading Journal

[Spydertrader]

Quote from ivob:

There's this FTT where you mention "A significant portion of this bar is red volume". What exactly do you mean by this?

'Significant portion' means, "more than a small amount."

Quote from ivob:

I mean this information would support that it is not an FTT but it was one.

I have no idea how you reached this conclusion, but you reached it in error. There is nothing to support or disprove. We either have an FTT or we do not. Clearly we do.

Quote from ivob:

Also this bar ends higher than where it opened and ended almost at its high.

1. It didn't and 'as high' though (not that it matters)

2. On my charts, it closed 1 tic higher - not exactly a ringing endorsement of change.

Quote from ivob:

Are you talking about red volume while the bar was being formed?

To be more precise, I'm speaking of the Intra-Bar changes which occurred in real time. A Gaussian change occurred within the bar itself. Increasing red volume peaked and decreasing black volume began.

Quote from ivob:

If yes, I suppose it would be wise to wait before entering (assuming you enter on FTT) until two bars later which also was an FTT but with black volume.

On the Forest Level, you need a Point Three to enter. On the Tree level, you enter on FTT's but (as a beginner) exit on an FBO. If you 'see' the bar in question as still part of the increasing red Gaussian (then changing Intra-bar to decreasing black, you may better 'see' the market signals - in this case change (FTT) - change (FBO) - change (second FTT) - continuation (BO of RTL).

Quote from ivob:

I just want to verify if I am seeing this correctly.

Note the attached chart. If you cannot 'see' the bar marked as "This Bar" as having (initially) characteristics associated more closely with the 'increasing red' portion of the Gaussian Curve, then later changing (within the bar itself) to characteristics more closely associated with the next part of the Gaussian (decreasing black), then you may inadvertently draw incorrect Gaussians (blue arrows) leading you to believe a change confirmation occurred - where none yet exists. The only reason one even considers this bar 'black' is due to the one tic difference in price from open to close. The blue arrows show B2B. However, this cannot be correct as we currently find ourselves within the Orange Forest. Using the correct Gaussians (black arrow), we are able to more accurately assess the Red Bar at the end of the chart - entertaining the idea that the bar has formed a Flaw (A Stall actually) rather than believing we have encountered an FTT. This entire exercise shows you how easy it is to find yourself several levels down into resolution levels when your intent was to remain at the Forest Level.

Monitor the Gaussians at the correct resolution level just as you do with price.

- Spydertrader

<img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=1381938>

 

[Spydertrader]

Quote from FilterTip:

May I ask about the PVR ? Is this where we assess how much vol we have within the first 30 secs of the bar in order to give a projection of what kind of vol we might have for the entire 5 min bar..?

PRV (Pro-Rata Volume) compares Volume levels NOW in order to anticipate Volume Levels by End of Bar. If one has 2000 contracts traded in the first 15 seconds of the Bar, then one can anticipate seeing 40,000 contracts traded by End of Bar (four 15 second intervals per minute x 5 minutes per bar x 2000 contracts = 40,000 contracts). Comparing this anticipated volume with the previous bar actual volume allows you to 'see' continuation or change at finer resolution levels. In addition, comparing Peak Level Volume levels can permit one to anticipate where an FTT might form.

As discusssed earlier in this thread, Mak explains his use of PRV in this post. The linked post references the attached spread sheet.

- Spydertrader

<img src=http://elitetrader.com/vb/attachment.php?postid=1034264>

 

[hypostomus]

If you all are worried about what the volume is doing inside a five minute bar, why don't you look at a one minute volume chart? An intelligent post here recently to that effect by BA_Trader seemed to be completely ignored. I promise you that you will find it utterly fascinating to know for real, rather than hypothesizing. You might even find it interesting to quantify it by coding the patterns you see and applying binary decision threshold tests and comparing them to similarly quantified price patterns.

 

[Bearbelly]

Quote from hypostomus:


If you all are worried about what the volume is doing inside a five minute bar, why don't you look at a one minute volume chart?

Too much trouble. Much easier to watch Maks PRV tool which does that job and gives an amazingly accurate prediction of the future at the same time. There are also tools to tell you what percentage of the current bar is red and black.

 

[ticktrade]

Spyder
I'm glad you referenced the multiple ftt's in that one area and reminded that at the forest level they dont matter. When I saw those I wondered how you would annotate that zone. I saw those and felt it was similar to some action on Thursday around the same time of day. I got chopped anticipating a bo, never pays to break the rules. I started watching the cumulative delta which was steadily dropping while price was chopping in the channel. Eventually the drop came. Again Friday there was similar action but I learned from Thursday and entered a couple times at the rtl.

Most of the day I spend watching the market while at work. I can't watch close enough to observe pv action within the 5 minute bar. I plot pv and delta on the 1 minute fractal so I can see whats going on, with my channels staying at the forest level. I don't understand why we don't drop down to that fractal to observe this. It seems more stressful to try to watch a 5 min. bar that closely and decide what PRV is doind the whole time. I suppose after enough practice you just see it and maybe that is the point your trying to get people to. I just don't have the time most of the day to watch that close due to interuptions. Guess I answered my own ?

I've tried multiple techniques to trade the ES and find this method a better fit for me. I've had the most relaxing entries this week that I've ever had.
Thanks to all that make this possible.

 

[Spydertrader]

Quote from hypostomus:

If you all are worried about what the volume is doing inside a five minute bar, why don't you look at a one minute volume chart? An intelligent post here recently to that effect by BA_Trader seemed to be completely ignored.

Actually, you raise a very good question. BA_Trader has been at this a while. Most likely, his experience allows him to monitor at a finer resolution level - bar to bar or even within a bar (what I have termed leaves or bug level). Those starting out, monitor at the Coarse Level (Forest) for decision making. As such, PRV plays a very small role at this Point (Forest Level). At the Coarse Level (Forest) Resolution, bar to bar changes only matter when the Point Three forms, and again when Price exits the Channel. Whatever price does within the channel doesn't matter at the beginner stages. With few opportunities for PRV to make an impact (beginning and end of a Point Three Channel), monitoring PRV levels becomes a 'mind training' exercise the rest of the time. Why not go down to a 1 minute level? Because People on the Forest Level need to monitor at a much more Coarse Level Resolution for decisions.

Mak has posted how one can 'see' these changes at even finer resolution levels than a 1 minute chart. However, one must learn to crawl before attempting to walk run or fly. At this point in the beginner level learning curve, we need to use the correct tool at the correct time, as well as take time needed to train the mind for the future.

- Spydertrader

 

[Bearbelly]

You have a knack for putting things in perspective, Spyderman.

 

[Spydertrader]

Quote from ticktrade:

I suppose after enough practice you just see it and maybe that is the point your trying to get people to. I just don't have the time most of the day to watch that close due to interruptions. Guess I answered my own ?

Bingo. Eventually, you'll get to a point where you'll just 'look' and 'know' what is what. The best analogy is driving your car. When you started (at 15 or 16 years old), you had a mental check list (Check the mirrors, check the blind spot, watch your speed, hit the turn signal, turn left). After practice and some time, you reached a point where all the above takes place automatically - you no longer need to mentally run through the list. You just do it without thinking.

In the beginning, you cannot do this with trading, it takes practice and time - just like it did with driving your car. You didn't have a 'PRV Tool' for making left turns when you started driving, but somehow you learned to do it without thinking. And that, is what this is all about.

For those that cannot monitor full time, yes the PRV Tool makes sense. For those that monitor on finer resolution levels, the PRV tool also makes sense. Even for people that need to train their brain, the PRV tool make sense. It just isn't needed to get to the next level.

Thanks for posting your thoughts.

- Spydertrader

 

[ivob]

Quote from Spydertrader:

Monitor the Gaussians at the correct resolution level just as you do with price.

- Spydertrader

[/B]

Thank you for explaining Spyder. I understand now. It's peaking red volume followed by decreasing black = change.

thanks,
Ivo

 

[ivob]

Is anyone here using Quotetracker?

For determining PRV of important bars I have found it's pace indicator useful. It displays volume activity as a percentage of preceeding volume activity. For example, it could display 60% on the setting one minute which means volume activity of the last minute is 60% of the average volume of all minutes that day.

I find it useful to watch this indicator (which is right on top of the graph). For example bar is red and the indicator says 150%. Bar goes 6 ticks up and is green and indicator says 210%. Bar turns red again, indicator is lower again. So we know dominant volume in this example is black. You can actually see the percentages go up or down quickly as price is moving in a certain direction.

Just wanted to mention this, maybe interesting for people already using QT.

regards,
Ivo