The ACD Method

Quon · Dec 16, 2011

Quote from DerSlutharsch:

I got burnt yesterday and I'm not taking any positions today but will watch closely, past action makes me think we are poised to see some clean moves the next one. I like the VIX here.

Yeah, this feel like one of those Fridays where you manage existing positions rather than add. That said, it's still early.

Shanb · Dec 16, 2011

Quote from Quon:

Yeah, this feel like one of those Fridays where you manage existing positions rather than add. That said, it's still early.

This ZNGA is getting hammered!

kinggyppo · Dec 16, 2011

Quote from Shanb:

ya Gld failed at its A-up...even with how beat up its been it cant sustain a bid!

I was long some FDX...out as the market is not really holding in here.

GLD traded right back to the open and reversed, easy money. I have a long bias on the intraday time frame.

gmst · Dec 16, 2011

Quote from kinggyppo:

GLD traded right back to the open and reversed, easy money. I have a long bias on the intraday time frame.

Bonds up, euro down, ES down but no movement in gold (compared to last 2 days volatility). Seems the downmove is done and its time to buy.

Edit: I mean downmove in Gold is done, and probably its a good time to start accumulating again.

Quon · Dec 16, 2011

Quote from gmst:

Edit: I mean downmove in Gold is done, and probably its a good time to start accumulating again.

You might have said the same thing though when it first confirmed the Monthly A down earlier this week. I wouldn't touch gold until we got the OR in January personally, but that's just me. Still two weeks left in the year, (two weekly OR's and 10 dailies). That's a lot of potential downside for something that's confirmed it's monthly.

Trader13 · Dec 16, 2011

Quote from mdl060374:

... I am just trying to come up with something that can maybe anticipate a directional move or failure, or provide as some sort of "catalyst" for movement

The point made here prompts a question: Are traders in this forum most successful using ACD to make directional trades, or volatility trades? I see references to a "long bias" or "short bias", and I'm not clear if this refers to a uni-directional trade (pure long or short), or a spread trade that leans long or short but benefits from volatile price movement in either direction?

gmst · Dec 16, 2011

Quote from Quon:

You might have said the same thing though when it first confirmed the Monthly A down earlier this week. I wouldn't touch gold until we got the OR in January personally, but that's just me. Still two weeks left in the year, (two weekly OR's and 10 dailies). That's a lot of potential downside for something that's confirmed it's monthly.

Thanks for your thoughts, very nice perspective. Further thinking it through, it seems to me that at least after today's action, relative weakness of gold has subsided. Probably, I will watch it for 3 more days, and if on relative basis, it does ok, I will buy it as a spread against something (maybe ES).

kinggyppo · Dec 16, 2011

Quote from Trader13:

The point made here prompts a question: Are traders in this forum most successful using ACD to make directional trades, or volatility trades? I see references to a "long bias" or "short bias", and I'm not clear if this refers to a uni-directional trade (pure long or short), or a spread trade that leans long or short but benefits from volatile price movement in either direction?

I think the latter part of the question would be directed to Maverick. He made a comment a few weeks ago about a spread trade being long volatility. To be honest I never thought of it that way. I always think of options etc. when I think of vol. Maybe he can expand on why spreading not Coke vs Pepsi, but using "outside the box" pairs is a vol trade.

kinggyppo · Dec 16, 2011

Quote from Maverick74:

Shan I use to sell options for years. I can show you 98% winners. It's the one bad trade I am worried about. That is why co-integration is such bullshit.

I don't want to find trending pairs either! I want to find stuff you can't back test for!!!!!! That is where ACD comes in. Anything that shows up on a backtest for you will show up at every quant trading desk in the country. I want to find the moves "before" they happen.

I'm not knocking mean reversion for other people. God knows Don Bright and I have been in the octagon debating this shit for years. It's not a matter of what works, but what longevity it has.

bump.

atticus · Dec 16, 2011

Isn't Fisher long natty from the 6 handle?