Very interesting. Can you recommend some actual reading to build such mindset without doing brute force? Is it correct that it's completely possible, one only have to find the right approach?
Tape reading?
- Thread starter prj
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Very interesting. Can you recommend some actual reading to build such mindset without doing brute force? Is it correct that it's completely possible, one only have to find the right approach?
Charts don't mean shit. With tape you can feel the supply and demand, make judgments, and decide to take a trade or not. And of course there is manipulation, you just have to see whats real and whats not. Tape reading takes time and practice, every stock has a different personality, stick to a few names and really get to know them and how they work.
Reading won’t change perception but drills do.
If you are earnest about it, start a journal, post the result of this drill and invite to comment.
The drill is called the 5x5 grid.
On a blank sheet of paper make a grid of 5 rows of 5 columns of equal vertical lines (25 in total) each that represent 1pt bars.
These 1pt bars have five horizontal ‘ticks’. One each at the high and low; three that divide each bar into 4 equal segments. Each segment represent a ‘tick’ (which for the ES is $.25).
The horizontal ticks represent a possible open and possible close at that tick.
This sheet is now a template, make copies as clean templates.
Drill 1
Begin to make a catalog of bars by drawing over this template one bar at a time.
Start on the left hand side either at the top or bottom going by rows or by columns in a logical progression to organize your result.
An example of the first bar could be, opens at the low, moves up to the high, moves down to the low and exits at the low, next bar opens at the low, moves up to the high, moves down to the low and exits one tick above the low. Next bar same open same sequence but exits two ticks from the low, etc.
There are other logical progressions by which to orient to process the drill.
By creating a limit of a 1pt bar, the drill excludes volatility for the moment so that one can discern the three parts of any bar. These parts are known as legs - basically a unidirectional graphical artifact. Observing a bar live is distinct from doing the drill. Exclude the live dynamic for now.
By viewing from the perspective of legs, the grid can be sorted so that the bars fall into three different piles otherwise known as types based on legs.
What are the three types?
How many of each type are there?
All bars start as a doji - the open and close are on the same tick.
Something happens on a bar when it transforms and adds a leg. It’s easier to see the more legs a bar has.
What is this thing that happens?
Drill 2
Add color.
Have one template colored as bars.
Have another template as candles.
By comparing and contrasting bars and candles, something is emphasized more in one than in the other.
What does each emphasize that the other does not?
Do the difficult things while they are easy and do the great things while they are small. A journey of a thousand miles begins with a single step.
-Lao Tzu
I'm not really keen on ridiculing other peoples trading approaches, but this is probably to most complicated and arcane way to view market structure I've ever seen.
Again, not intending to kick balls. If that works for you, fine, but if I was to start over again, I'd probably cut out all the charts and candles and just focus on volume by price for the big picture and tape for entries and exit.
How would you go about achieving that, chart or algo/spreadsheet?
If you are focused and the market in question doesnt have a big tick range like corn or interest rates on a quiet day, you can do it with pen and paper.
Besides that, anything that displays volume at price is sufficient. You can do it in Excel or in a charting platform. I mostly use the Volume at Price column in my DOM.
Besides that, anything that displays volume at price is sufficient. You can do it in Excel or in a charting platform. I mostly use the Volume at Price column in my DOM.
When you say "volume by price for the big picture", is this still intraday?
Lol,
There’s a difference between top down and bottom up. Most never are willing to do the work necessary to truly ‘see’ a tape - instead thinking shortcuts are to a subject as maps are to a territory.
http://www.visualcapitalist.com/mer...&utm_medium=social&utm_campaign=SocialWarfare
When one can see a tape, the market offers tells. Tells indicate turns coming up.
Since your attached to VAP, then Dom and non-Dom volume would be the next ball to kick.
Unfortunately it would be too complicated and arcane to distinguish to a closed mind.
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Dude, what's non DOM volume?!?!! Every market information there is is contained in a Price ladder. Price, Time & Volume, I'm not sure how much more bottom up you can get. The "tape" is literally nothing more than how much traded at which price and when, no matter how much witchcraft you invent around it. Seems like you need to get the work done, grab pen and paper and watch tape a couple of hundred hours.
I have a pretty open mind tbh...I just close it to crap.
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