The Stochastic Indicator

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Quote from icarus618:

Jack,

Having a complete toolbox might have been handy this morning, as I found myself on the wrong side of a BO while slaloming what looked to me to be congestion. In light of Wednesday PM, I was in continuation mode and looking for CCC. Any suggestions?

**** There is a dicontinuity from close to next open. Cover this two ways: do your graphics on the slowest fractal possible for market formations. (The key is getting a trend tape, primarily; if tape is not possible do channels that are interday as first effort and go to pennants as next order.) this can be reflective stuff after close and projections often work.

second, at open, you are focussed on he sync. You went out in the PM of course, and now you are reentering to make money again. You secondary focus is the consideration of "Did the formations keep any continuity as a consequence of the absence of a change on the market operating point.

The above is what is happening to you as you ease into an excellent consciousness. you are, at open getting several levels of stuff straightened out. we day trade to keep the margin leverage twice as high by taking out the over night risk. sometimes there is no overnight causal factors re risk. But we do not hold over anyway because or ap of cap is twice as great by not holding.

I've also been thinking about how I too can produce Tomorrow's Paper Today. On the attached chart I've made an attempt. I would be grateful for any comments.

**** This was not an attempt. It is the real McCoy. Not an ounce more of stepping over the line and extrapolating into new stuff. you let the day begin (See above) and you see it fill out your best effort to "see".
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I am putting some additional "insight" in your hip pocket with this.

for two days we have had some really strong stuff in the market environment. You will see some threads start up to deal with it soon when people catch on.

We always have our eyes pealed.

When you set up channels and see the price driving against it on the "away" side, then there is news coming that reinforces the trend. It is not quite on the street.

I have more citations with equities that come from BO's but it is not impossible to stay out of trouble if you add to holdings when the "away" side is really going well (pushing the envelope) See "climax runs" in googling.

Yesterday we went into "long" push. Today it has been a "short" push. Our tool box handles this. You can actually see icarus post on this biginning of the "short" push.

We all know the news basis for this which is OT here.

In commodities there are producers and comercials. for futures indexes the financial industry is a "commercial". Their "puts" can really push "short" trends under way.
 
Quote from jack hershey:

I am putting some additional "insight" in your hip pocket with this.

for two days we have had some really strong stuff in the market environment. You will see some threads start up to deal with it soon when people catch on.

We always have our eyes pealed.

When you set up channels and see the price driving against it on the "away" side, then there is news coming that reinforces the trend. It is not quite on the street.

I have more citations with equities that come from BO's but it is not impossible to stay out of trouble if you add to holdings when the "away" side is really going well (pushing the envelope) See "climax runs" in googling.

Yesterday we went into "long" push. Today it has been a "short" push. Our tool box handles this. You can actually see icarus post on this biginning of the "short" push.

We all know the news basis for this which is OT here.

In commodities there are producers and comercials. for futures indexes the financial industry is a "commercial". Their "puts" can really push "short" trends under way.
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Icarus picked this off in his chart right at the beginnig of it.
 
Quote from nwbprop:

I was gonna stop posting charts until july 1 but I couldnt help such a textbook play. well......its a textbook play for people who take the time to understand what he is saying. Up 138 cents on the spys today thanks to JACK.
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nwbprop, thanks for posting your chart, the way people annotate charts always helps me see how they were thinking about the various patterns. A few questions to make sure I understand your notes:

1. You've marked the initial "centering" period. Did you bracket this for bo (and, therefore, catch the very early part of the move down)?

2. Right after that centering you marked one bar as "volume spike BO down". If you did not bracket the centering period did you enter immediately after the high volume 1-min spike?

3. On the "traverse failure" that you marked, did you exit the short on the next (doji) bar or just mentally notate the failure?

4. For the remainder of your chart you've marked "CCC, slaloming". As I don't ski I've never quite understood the slaloming concept. Does that mean you stayed in your short all that time and didn't exit after the traverse failure? Does slaloming mean riding out all the sideways movement anticipating continuation in the direction prior to the CCC?

Thanks again for your chart, very helpful.
 
Quote from Magna:

nwbprop, thanks for posting your chart, the way people annotate charts always helps me see how they were thinking about the various patterns. A few questions to make sure I understand your notes:

1. You've marked the initial "centering" period. Did you bracket this for bo (and, therefore, catch the very early part of the move down)?

2. Right after that centering you marked one bar as "volume spike BO down". If you did not bracket the centering period did you enter immediately after the high volume 1-min spike?

3. On the "traverse failure" that you marked, did you exit the short on the next (doji) bar or just mentally notate the failure?

4. For the remainder of your chart you've marked "CCC, slaloming". As I don't ski I've never quite understood the slaloming concept. Does that mean you stayed in your short all that time and didn't exit after the traverse failure? Does slaloming mean riding out all the sideways movement anticipating continuation in the direction prior to the CCC?

Thanks again for your chart, very helpful.
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1. I was still in quasi slaloming mode. BUT, I ALWAYS LOOK FOR VOLUME SPIKES. especially after midday. Jack stresses the PM start using volume as the indicator.

2. Yes, i was short as soon as volume spike down. I was looking for stochs to go to a continuation mode(which occured).

3. Yes, i did cover my short and reversed long because it failed to traverse the channel on the second pt 3. Jack again stresses this as the end of continuation mode. Turning into sloloming mode.

4. In this case, i was still long from failure to traverse, then i shorted at top of ccc, then i covered and got long at bottom of ccc. The objective is to get short and long every traverse(many traverses) of the ccc.I still am not Exactly sure where the top and bottom of the ccc is but i have an inkling that it happens at market opertaing points. Market operating points to me(not clear to me yet) are points like the first poit3, second point3 , low of the day, high of the day, the point at which the price reverses to the other side of the channel, points where there were previously turning points, etc...

I hope jack adds slaloming too our tool box beacuse i am not sure where exactly to get short or long in the ccc. sometimes i get short at the wrong point, see it go up 10 cents to the next operating point(1st pt3), only to be the top of the ccc and then going down to whre i thought it would originally have gone. I thnk volume has a lot to do with finding the right opearting point but i am sure jack is going to enlighten us when the time is right.

Just some more thoughts on operating points. I think operating points are thier to be either change(reversal) or busted through(continuation). i think volume is what shows us what the market wants to do. I am still unclear about opearting points so this may be wrong.

Friday was my best day ever trading the spys. I made a 149 cents or 15 pts. This is not typical of what i have done but i hope more days like these are too come. I jsut want to thank jack again for his generosity of sharing knowledge.



jc
 
I am using this computer for the weekend and I have begun the tool box etc. I misplaced one subsection and I replaced it but it disapeared. I replaced it as the last entry for today.

I have tried to kill about three posts using a reason (cleanup the journal); so far it has not worked.

In the stuff I put there I suggesthowto print and maintain the organization for quick reference. The plan is to number my posts at the top of each and put the page of the ET journal where it appears. By keeping two three ring binders we can create a quick reference system and also have a binder organized logically like a book.

I will be transferring stuff from this thread into the journal as time passes; it will be editied before it appears.

It will be standard for me to request that stuff from others be killed there to make it easier for us to corrdinate compiling the binder sets. I do not think it will work probably because i already had one post I needed disappear and three that I wanted killed have not been.

I will be adding illustrations as well. I requested that some things from the "Catchup" journal be printed and inserted as well.

If you delay setting up the binders you probably will not be able to keep up when I get rolling.

I may post a table of contents using ET pages and my post #'s if it gets too messy.

bubba7 is my alternate computer.
 
Time is still in short supply :mad:
Traded Thu and Fri - paper of course :)

Thu
#1 long rocket 10:03 977.50
10:18 sell 977.00 failure to traverse -> down vol picking up
-0.50

#2 failed rocket -> MACD reversal
10:31 short 974.75
10:46 cover 974.25 intrabar rocket failed at 10:35 -> failure to traverse
+0.50
Hesitated with entry because MACD x occured after rocket failed.

Day 0.00


Fri
#1 long rocket -> hod bo
10:28 long 985.00
11:11 sell 986.50
+1.50

#2 short rocket
13:30 short 980.75
13:53 cover 974.75 failure to traverse. What a selloff - tape was on 5m, channel on 1m
+6.00

Day +7.50

Week: 2 days/4 trades/+7.50
 

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Jack, thank you for your continuous efforts to share your knowledge. Your journal is gold to anyone who understands it and has the discipline to apply it.

You pointed out that you will emphasize on areas that are less understood by people who use your method.
One such area is the stop log - it's not mentioned too often by people posting here; I have a mixed understanding of it.

In the journal you say that stop log should be kept on the trading fractal, and that it's primary function is to protect capital against unexpected events. Consequentially, stops are rarely triggered and they are by no means used to take us out of the trade under "normal" market operation.
While I understand the way to determine the offset of the stops and the periodicity of recording them, it's unclear to me where to record them.

What you record on your log is price values where the price bar formations exhibit the more important values.
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Can you expand on the price formations - do you mean lows/highs/centering for the current channel or trend. Also, should the stop be AT the price formation or 1-2 ticks away?

You mentioned in a recent post that you had surgery - I wish you quick recovery and great health. This makes what you are doing here even more admirable.

Thank you,
vorzo
 
Quote from nwbprop:


4. In this case, i was still long from failure to traverse, then i shorted at top of ccc, then i covered and got long at bottom of ccc. The objective is to get short and long every traverse(many traverses) of the ccc.I still am not Exactly sure where the top and bottom of the ccc is but i have an inkling that it happens at market opertaing points. Market operating points to me(not clear to me yet) are points like the first poit3, second point3 , low of the day, high of the day, the point at which the price reverses to the other side of the channel, points where there were previously turning points, etc...

I hope jack adds slaloming too our tool box beacuse i am not sure where exactly to get short or long in the ccc. sometimes i get short at the wrong point, see it go up 10 cents to the next operating point(1st pt3), only to be the top of the ccc and then going down to whre i thought it would originally have gone. I thnk volume has a lot to do with finding the right opearting point but i am sure jack is going to enlighten us when the time is right.

Just some more thoughts on operating points. I think operating points are thier to be either change(reversal) or busted through(continuation). i think volume is what shows us what the market wants to do. I am still unclear about opearting points so this may be wrong.
More...

nwb, you made some fine points on operating points :)
Not sure if that's what Jack means by operating point though - in the journal he defines it as the curent point in the market.
Jack it'd be great if you can elaborate on this.

Nice day, nwb. Question: why do you trade spy instead of es. Also you seem to trade on the 1m?

Thanks,
vorzo
 
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