The ACD Method

[punisher]

Maverick74,

Somehow I just missed what you guys typically use for weekly and monthly ACD opening ranges? Is it entire first day of the week/month respectively or entire first day for the weekly and entire first week for the monthly?

Also, when you spoke of "confirmed" weekly or monthly (i.e. following week "confirmed" monthly Aup...) did you mean that the next week PA simply "stayed" above monthly Aup (therefore confirming the validity of the move that way) or that as the price progressed then it came back and retested that A-up from the top side and rejected it (aka breakout over Aup, retest, and up it goes)?

Thanks!

 

[Maverick74]

Maverick74,

Somehow I just missed what you guys typically use for weekly and monthly ACD opening ranges? Is it entire first day of the week/month respectively or entire first day for the weekly and entire first week for the monthly?

Also, when you spoke of "confirmed" weekly or monthly (i.e. following week "confirmed" monthly Aup...) did you mean that the next week PA simply "stayed" above monthly Aup (therefore confirming the validity of the move that way) or that as the price progressed then it came back and retested that A-up from the top side and rejected it (aka breakout over Aup, retest, and up it goes)?

Thanks!

The exact OR is not as important as the idea of consistency using the same OR across time. The idea is by fixing the OR you can identify "relative value" better.

 

[punisher]

The exact OR is not as important as the idea of consistency using the same OR across time. The idea is by fixing the OR you can identify "relative value" better.

There is a difference between being consistent (consistently using values for each timeframe) and using consistently the same value across timeframes.

So to make sure I understand: are you advocating for using the very same OR across intraday, weekly, monthly, are you? Could you give me a good example with made up OR of let's say first hour of trading for intraday, how would you then approach weekly and monthly? Would it still be 1st hour of trading of the first day of the week for weekly (and similarly 1st hour of the first day of the month for monthly)? I would think that the OR should be increased as you go up to the bigger timeframe, but once the OR are set (separate for each frame) then consistently used? Just asking how you guys approach that.

To make sure, I'm not looking for anybody's specific OR values, specific A/C values and any other custom/proprietary (to each trader) signals/indicators, just the general idea how you guys are approaching your own OR across timeframes in this particular method

Any comment on the "confirmation" you talked about before (see my post above)?

Thanks mate!

 

[Maverick74]

There is a difference between being consistent (consistently using values for each timeframe) and using consistently the same value across timeframes.

So to make sure I understand: are you advocating for using the very same OR across intraday, weekly, monthly, are you? Could you give me a good example with made up OR of let's say first hour of trading for intraday, how would you then approach weekly and monthly? Would it still be 1st hour of trading of the first day of the week for weekly (and similarly 1st hour of the first day of the month for monthly)? I would think that the OR should be increased as you go up to the bigger timeframe, but once the OR are set (separate for each frame) then consistently used? Just asking how you guys approach that.

To make sure, I'm not looking for anybody's specific OR values, specific A/C values and any other custom/proprietary (to each trader) signals/indicators, just the general idea how you guys are approaching your own OR across timeframes in this particular method

Any comment on the "confirmation" you talked about before (see my post above)?

Thanks mate!

Yes, you want to scale your OR with time. Use the same OR per group so say FX all use one OR value, all US indices use another, all energy another OR. For longer term levels the OR will probably be the same such as the first day of the month for monthly levels.

For the smaller time frames you want to scale your OR based on what type of trading you are doing. If you are a fader, you will want wider OR, a momentum trader will want tighter OR. If you are using them just for NL calculations then you will want OR levels that give you more diversity in your daily scores. Everyone is different and there is no right answer. You just have to think through the logic of what you are trying to accomplish.

 

[punisher]

Yes, you want to scale your OR with time. Use the same OR per group so say FX all use one OR value, all US indices use another, all energy another OR. For longer term levels the OR will probably be the same such as the first day of the month for monthly levels.

For the smaller time frames you want to scale your OR based on what type of trading you are doing. If you are a fader, you will want wider OR, a momentum trader will want tighter OR. If you are using them just for NL calculations then you will want OR levels that give you more diversity in your daily scores. Everyone is different and there is no right answer. You just have to think through the logic of what you are trying to accomplish.

Thanks Maverick.

I must be too dumb to get it. A specific example with made up OR numbers across timeframes would help a lot. I understand that there are different ORs for different products and trading styles (though the idea of OR for "fading" with ACD method makes me go hmmm)

Let's assume the product X I trade would call for 1st 60min OR on intraday basis. What would be the logical OR for weekly and monthly studies? Would that be full 1st day or still 60min of the first day?

I hate to be pain in the ass, but is there any chance you could comment on the "confirmation" you talked about before (see my earlier post)?

Thanks

 

[punisher]

There is one concept in Fisher's book that bothers me as it is somewhat contradictory to me.

On one hand you are supposed to wait for the market for it to tip its hand (by either establishing Aup or Adown) to get your bias. And even if the market makes it to i.e. Aup but does not confirm (staying there) then, as Fish claims Aup is not valid and Adown could still be in play (as there was no valid Aup yet). So far so good. At east that part is something that can be structured in trading rules (for the trader to follow) because you can clearly determine whether something happened or not

But then Fish comes the idea of "failed" As, when price doesn't get there and reverses, so you could possibly fade the move with very low risk to other side of A. This "rubber band snap back" concept sound good until you realize the problem: in order to keep the risk low, how could you know the prices won't get there to first A? you would have to wait until some sharp reversal but that increases the risk. And even then, it is a contradiction of the basics of that ACD method which says to wait until you get proper bias (Aup or Adown) before decide to enter, especially if reaching first A but not confirming it (as mentioned above) dictates you should still wait for the proper (valid) signal.

This "failed" A makes sense if one has larger OR for fading (like Maverick suggested) but then, I think, it flies in the face of ACD method as it is not a fading method.

(scratching my head...) what am I missing here?

edit: the only way I could reconcile these seemingly opposing concepts is by watching PA from the open, if it moves outside OR with "conviction" then look for A to be established. If there not so much conviction after opening then risk fading (i.e. failed A)

 

[Maverick74]

There is one concept in Fisher's book that bothers me as it is somewhat contradictory to me.

On one hand you are supposed to wait for the market for it to tip its hand (by either establishing Aup or Adown) to get your bias. And even if the market makes it to i.e. Aup but does not confirm (staying there) then, as Fish claims Aup is not valid and Adown could still be in play (as there was no valid Aup yet). So far so good. At east that part is something that can be structured in trading rules (for the trader to follow) because you can clearly determine whether something happened or not

But then Fish comes the idea of "failed" As, when price doesn't get there and reverses, so you could possibly fade the move with very low risk to other side of A. This "rubber band snap back" concept sound good until you realize the problem: in order to keep the risk low, how could you know the prices won't get there to first A? you would have to wait until some sharp reversal but that increases the risk. And even then, it is a contradiction of the basics of that ACD method which says to wait until you get proper bias (Aup or Adown) before decide to enter, especially if reaching first A but not confirming it (as mentioned above) dictates you should still wait for the proper (valid) signal.

This "failed" A makes sense if one has larger OR for fading (like Maverick suggested) but then, I think, it flies in the face of ACD method as it is not a fading method.

(scratching my head...) what am I missing here?

edit: the only way I could reconcile these seemingly opposing concepts is by watching PA from the open, if it moves outside OR with "conviction" then look for A to be established. If there not so much conviction after opening then risk fading (i.e. failed A)

Punisher...are you an Aussie?

So this might be hard to be believe but all these topics and questions, every one of them, has been discussed at length on this thread. Even more hard to believe there are many who have actually read this whole thread start to finish. And yet even harder to believe, I wrote a lot of it! LOL. I understand there is a lot here, but I would strongly encourage you to invest in some strong coffee and find a comfortable spot and start reading.

There is actually an individual who has turned this thread into a book (without paying me any royalties) and it's circulating out there in the black market. It has chapters and a table of contents, etc. I've read it myself and I must say it was a damn fine book.

Please give that a shot first and as you read through the thread, if you still have questions, I can follow up on them.

 

[punisher]

Punisher...are you an Aussie?

So this might be hard to be believe but all these topics and questions, every one of them, has been discussed at length on this thread. Even more hard to believe there are many who have actually read this whole thread start to finish. And yet even harder to believe, I wrote a lot of it! LOL. I understand there is a lot here, but I would strongly encourage you to invest in some strong coffee and find a comfortable spot and start reading.

There is actually an individual who has turned this thread into a book (without paying me any royalties) and it's circulating out there in the black market. It has chapters and a table of contents, etc. I've read it myself and I must say it was a damn fine book.

Please give that a shot first and as you read through the thread, if you still have questions, I can follow up on them.

No problem Mav, I've read the book and watched his seminar (which is like reciting the book with extra fun pokes at the attendees) but I admit I haven't go through entire thread, maybe 100 pages or so. The problem with the search option on this forum is that it doesn't even find this thread (!) let alone list your posts from this thread alone.

My mind is working around this whole concept and some things crystalize as I sleep it off.

I have Logical Trader. Is that what you are talking about or there is some other top secret stuff? How can I get my hands on it?

 

[Maverick74]

No problem Mav, I've read the book and watched his seminar (which is like reciting the book with extra fun pokes at the attendees) but I admit I haven't go through entire thread, maybe 100 pages or so. The problem with the search option on this forum is that it doesn't even find this thread (!) let alone list your posts from this thread alone.

My mind is working around this whole concept and some things crystalize as I sleep it off.

I have Logical Trader. Is that what you are talking about or there is some other top secret stuff? How can I get my hands on it?

No, not logical trader. Reach out to Robert Yanks and be "kind".

There is a guy on here named King who was selling used copies out of his garage in Schaumburg, IL. I had some of my Italian friends pay him a visit and put an end to that.

Sorry King.

 

[punisher]

No, not logical trader. Reach out to Robert Yanks and be "kind".

Thanks for the info Mav. The only way is to drop him a line through the forum, I tried doing that but I don't think he is around a lot these days, his last post was in Dec last year. I don't know why this forum doesn't offer sending someone an email message...bummer