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Technical Strategy
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Quote from jack hershey:
Here is a blow by blow on the P, V pre flight Check.
1. Is the big picture and filing information. The premium is foind at indexarb.com or prehaps in the Iterative rfinement thread. you can use yesterday's in a pinch or reset the S/S using the premarket values coming through and with them the close of yesterday. This is a DJ and YM measure as compared to the $INDU cash value.
Check the IT trend (Intermediate Trend) and if an FTT on the IT is in effect. This means you are in an IT trends overlap if you note Y for YES.
Synch is where, after open, the premium comes to the mathematically determined offset (See indexarb.com) AND on your lists you read that the offest is there by doing the arithematic between $INDU (CASH) and DJ and/or YM (indexes).
Put this event in the -1 column for use tomorrow as background.
Note the entry bar for the day.
2. For days -2, -3 and -4 fill in the the channel action as W or M or trending or whatever happened. As the day goes by you can fill in today under -1.
Check the preopen bars to see if you are within yesterday's ending channel. This will also enable you to note the gap arrows for the open.
As the day goes by you note the range limits and note their difference at close od ES.
As you get to the end of midday (on volume PACE shift) note the internal center line or F of of FTP or FBP internals.
these days we may have to shift the scale from 2 points to 5 points or greater. Note this as a mind calibration.
On channels there is a VE level required to expand the channel width. Note this as the day gos by. you can do stick outs if later you have a greated/lesser value; this gives a range for refreshing your mind when you rewrite the values down as the days go by.
Things happen during the day. Note the highlights from the log at the end of day.
Medium part 3.
The line drawing of channels notes the channel FTT trading frequency. In medium, note the number of medium trades. (See X in MODE and R in D column.)
Do VE volume for the traverses by end of day.
Laterals are either rest periods or expert slalom trading grinding opportunities. Seasonally, they can become important. the last skill acquisition on each level is handling the Laterals. So looking at them during preflight is a good drill. If you note the end bars of midday you have a context during the changing of seasons and how the days of the week go and how news affects midday before or after news or reports.
For some slopes of channels laterals occur on the non dom traverses. Medium is where traverses are important. Laterals are the least moving internals and OB cast shadows that turn into laterals. Besides Y/N you can note average lengths. there is room because the # substitutes for Y.
Expert, the fine of 4., does have one row that is done by all skill levels. This is the opening tape often called rocket trading. Rockets do occur other times. It is more important to know the rocket range than the number of bars. Put in the range in points and ticks.
Tapes have VE's as we know. Note the volume level required and do the strikeout for establishing the range on a lesser/greater basis.
S/S has five characterisitics. It is like a MACD indicator centered on the premium. The offest is usually the premium at the beginng of the day. I see the noise bracket is missing. Sorry I will add it and attach new improved sheet. Two pairs of rays are used on the S/S. the inner pair has to be breached to signal a leading indication of price is coming up. The outer pair is like the STOCH hold signal which indicates the "smart money" is doing something persistently. Contemporary values are in Iterative Refinement.
The premium drifts, we keep track of the drift in points with a point counter. When 4 points is hit a lot of position trading "reversion" bots activate in Chicago. We note this drift time.
I feel the Connors Hayward volatility compression signals are followed by more improtant signals regarding smart money. frontrunning smart money becomes important since they push so nicely. Over time, the envelop of smart money relative to the premium does two things; it drifts relative to the noise envelop and then, next it expands as distorts in the directio9n of smart money's efforts relative to the cash. we keep cash out of the picture vis a vis signalling just since it is so sluggish as a composite. We record during the day the "lead" of the compression relative to the normal. So this is the time from start to minimum of compression. we do the same to time from the minimum through enough expansion to the time of the beginning of the persistence of smart money. These kinds of times and their timing are used in support of trading contracts at multiples of ES market capacity. We splice, harmonically, into the opportunity that is the front running window of smart money.
For DOM we look at how being out of balance works. DOM av ratio B/A is how the out of balance in cummulative values of Bid and Ask sides can happen. If we are seeing mor than 2 1/2 on average durinf dominant traverses we are also looking at PACE,overlap and voaltility on the logs during those times and especially when the traverses are coming to maturity. (I will post on this once things settle down more and the real time trading days record begins to show up in boot camp or I will pullsome trading over from Iterative refinement to make points similar to the PRV posts today.)
DOM cummulative is a super indicator of uncertainty and certainty in the CW. I have prints of 700 on both sides just before incredible wipe outs on 50+ T&S under maximum cascading (Do the camtasia and audio of 22FEB06). Seeing this for past few days is instructive. We note it during day from logs.
Wall size is similar to DOM cummulative. these oreds do not get filled and they represent the largest the minority can get to prevent further price movement on the "right" side of the market.
In summary, the preflight check is done mostly as the day goes by and, ofcourse, it is then ready for tomorrow. It is all part of the "Tomorrow's Newspaper Today" modus.
So this sheet become a log of context on three levels. The 2003 preflights around 28OCT were seasonal except for the current carrier of the financial industries current contributions to ATR and volatility. what happens overnight after most of it is filled in is the coarse od the preopen and open.
I feel filling in four days row by row is an excellent mind building drill opportunity.
Quote from nkhoi:
sync is only for first 5m 3 bars at the most, after that shift your mind to something else.
...Synch is where, after open, the premium comes to the mathematically determined offset...
Thanks, Nkhoi. Just to clarify, if synch hasn't happened by the end of bar three, it can be disregarded?