The ACD Method

[Maverick74]

Quote from mfbreakout:

Agreed. Here is copper 30 days number line over last 8 days.

-3,-3,-1,-3,-1,-1,1,1

and for ES , -6,-8,-4,1,0,2,6,8.

copper weakness has been quietly showing slowing GLOBAL GROWTH.

Well Copper is a huge China play. China has been much weaker then our markets.

 

[Maverick74]

Here is a spread chart showing long SPY and short FXI. Yet another alternative to simply shorting ES.

 

[mfbreakout]

Quote from mfbreakout:

Tomorrow if BIG BEN does not weaken $ by further quantitative easing ( who knows which form it will come), US $ will strengthen and equities, commodities etc.. will be under pressure. This is just one scenario but a lot is riding on it.

CL set up for 09-21-2011

http://www.screencast.com/t/tJ3MyCqkhr

 

[Maverick74]

Quote from Maverick74:

Wheat and Soybeans breaking down.

Here is a followup to the soybean trade I mentioned on Sept. 13th as it broke through the monthly A down. Down 60 cents.

 

[Maverick74]

Quote from mfbreakout:

CL set up for 09-21-2011

http://www.screencast.com/t/tJ3MyCqkhr

Not sure if you trade the distillates of crude oil or not but right now RBOB Gasoline is much weaker then crude. RBOB has confirmed a monthly A down while crude has actually bounced off of the monthly A down several times now. A down for me is 2.77 and currently trading 2.70.

 

[RCG Trader]

Quote from Maverick74:

I thought I would post a chart giving you guys ideas on how you can use macro ACD. This is probably more for RCG since he trades currencies. This is what my macro FX grid looks like. It's a huge grid of all the FX pairs in rows by the same currency. So we have 4 rows. We have the Euro pairs, the Dollar pairs, Yen pairs and the Swissy pairs.

This is what my monthly grid looks like. It allows one very quickly to get a quick feel of where the real strength or weakness is. I want to note something on the dollar pairs. To make the visual easier, I inverted some of the pairs so all the dollar pairs have the dollar as the base currency. This allows your eyes to see the strength or weakness much clearer. For example, the 2nd row which are the dollar pairs, there are 3 currencies where the dollar is the non base currency (yen, loony and swissy). By using a - sign, the currency will invert on the chart.

So by taking a very quick glance at this chart, you can immediately see that the dollar is very strong against all the major pairs. The only pairs where there are no monthly A downs yet are the loony and the swissy. You can see this right away.

Organizing information is very important to trading. BTW, I only inverted the dollar pairs but certainly you could do this with all the pairs to make it easier to compare charts.

Nice work Mav, thanks. Been staring at the CHF pairs for a bit now trying to figure if the ECB intervention is going to work. It seems to be holding. Wow, I was gone from ET for few days and look what I missed

 

[RCG Trader]

Quote from Maverick74:

I have said this before and I will say it again. Let me be absolutely clear about this. I believe more in this next statement then I do that the sun will rise in the east tomorrow. If you are NOT already a profitable stock trader or a daytrader then no ACD levels will make you one period. I cannot stress this enough.

I have traded a lot of stock in my life. I understand the nuance of stock trading. If you have never been a good stock trader, then slapping opening ranges on your charts with A levels around them is not going to be effective. That's just the way it is. I know there are a lot of guys out there struggling looking for something. And I feel for them. Every trader has been there. But there is no magic with ACD.

Probably one of the better posts this year. What ACD has done for me is allow me to objectively manage my risk and allow me to follow many many more symbols. Fish says to not risk more than 2% of capital on any one trade, which I thought was silly when I first heard this from Acrary many years ago. But now I understand the casino aspect in this style of trading.

What I mean by this is that you need to follow a large amount of markets. What I have found is that it is rare that your trade will hit a point B. What is more likely is that you will get a time stop, which means you will take a small loss or post a small gain. Now, for the time stop to actually work this way you need to have a system that essentially indicates that if price has not moved a certain distance in what Fish recommends as twice the time frame of the opening range, then you need to get out. This, like the rest of ACD, should be volatility based.

What will happen is that this will let you keep your powder dry until that time of month when you catch the big move. Obama, The Bernank, Merkel, the ECB, somebody is going to say something to make the markets move. ACD allows you to be there and well armed ( with capital) when that does happen.

 

[mfbreakout]

Quote from mfbreakout:

CL set up for 09-21-2011

http://www.screencast.com/t/tJ3MyCqkhr

correction: 3 day rolling pivot high is 87.40 and not 86.60 as noted on the chart

 

[mfbreakout]

Quote from Maverick74:

Not sure if you trade the distillates of crude oil or not but right now RBOB Gasoline is much weaker then crude. RBOB has confirmed a monthly A down while crude has actually bounced off of the monthly A down several times now. A down for me is 2.77 and currently trading 2.70.

Thanks. No, I do not trade RBOB yet but it's on my list as I figure out how to calculate monthly A up or A down.

I understand, you do not want to share your levels to protect your stop loss. However, if you can share framework for calculating monthly A up or A down, that will be helpful. For example Fish has following monthly data ( September)

copper pivot high = 4.1655, pivot low= 4.1642

then July- first of the month ( this supposed to provide reference points for 2nd half of the year till December)

Pivot high= 4.4118 and pivot low = 4.3715


Similarly for RBOB Sept. data. Pivot High= 2.8653, Pivot low= 2.8606

July- First of the month.

Pivot High= 2.8930 and pivot low= 2.8345

Does these numbers have any value in calculating monthly A up or A down.

 

[Maverick74]

Quote from mfbreakout:

Thanks. No, I do not trade RBOB yet but it's on my list as I figure out how to calculate monthly A up or A down.

I understand, you do not want to share your levels to protect your stop loss. However, if you can share framework for calculating monthly A up or A down, that will be helpful. For example Fish has following monthly data ( September)

copper pivot high = 4.1655, pivot low= 4.1642

then July- first of the month ( this supposed to provide reference points for 2nd half of the year till December)

Pivot high= 4.4118 and pivot low = 4.3715


Similarly for RBOB Sept. data. Pivot High= 2.8653, Pivot low= 2.8606

July- First of the month.

Pivot High= 2.8930 and pivot low= 2.8345

Does these numbers have any value in calculating monthly A up or A down.

I don't use monthly pivots and I'm not sure how Fish is calculating his. Generally speaking the pivots should give you the same bias as monthly A levels. If anything, they will be tighter and get you in the trade earlier.