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There is no such thing as price action.
- Thread starter LodeRunner
- Start date
Quote from vingbel:
Slapshot,
Now, agreeing that many hours of screen time is needed to make this work, can you explain a little more about your method of determining velocity?
Also buy vs sell pressure and how you like to judge it based on whether the sales are occuring on the bid or the ask?
vingbel,
I am sorry but the above is very difficult to verbalize. This is like asking an experienced golfer to explain his swing. It is something that has to be experienced a thousand times, you can't learn it from talking about it.
The only suggestion I can make is to pick one instrument (the more liquid, the better) and just watch the DOM for an hour per day until you get it for yourself. Do it on a sim program like IB sim or Ninja sim so that you can fully concentrate on the price action, not managing a position. I did this for over a year to learn it.
BTW, my style of reading works for me with futures, I don't trade stocks so I can't say if it works for that or not.
Sincerely,
Paul
Quote from ProfLogic:
Shares or contracts aren't traded in time they are traded individually and in groups.
Ah, but the TRADERS themselves make time-based decisions, in fact the majority uses some kind of time-based increment to make buy/sell decisions. Therefore trader behavior is also reflected in time-based charts.
Slapshot,
Agreed that it's hard to verbalize, but can I ask you to try. I have been using a SIM and trading and I kind of see what you're talking about, so any more clues you can add would be greatly appreciated.
To use your sports analogy. Coaches exist because some things improved upon or even taught, even though pure talent cannot be taught. Many great athletes go on to coach and have to verbalize much of what they know.
Anyway, just trying to learn a new nugget, so please take this in the spirit in which it was meant.
Any clarity to how you believe you're determining volicity and buy and sell pressure might be helpful. What you said reminded me of another great trader who said to me, "ask yourself if they're hitting the bid or the ask."
Agreed that it's hard to verbalize, but can I ask you to try. I have been using a SIM and trading and I kind of see what you're talking about, so any more clues you can add would be greatly appreciated.
To use your sports analogy. Coaches exist because some things improved upon or even taught, even though pure talent cannot be taught. Many great athletes go on to coach and have to verbalize much of what they know.
Anyway, just trying to learn a new nugget, so please take this in the spirit in which it was meant.
Any clarity to how you believe you're determining volicity and buy and sell pressure might be helpful. What you said reminded me of another great trader who said to me, "ask yourself if they're hitting the bid or the ask."
Quote from vingbel:
ProfLogic,
Two questions:
1) So speed does play into your decision? That is, you do pay attention to how long it takes those volume bars to build?
2) What do you mean when you says you build your charts "fractally" in increments of seven?
1. No, all of my decisions are based on oscillations. Whether the oscillation on a chart is created quickly or slowly makes no difference. Question: Would you prefer your trading decisions to be made slowly and methodically or quickly and potentially with greater margin for error? You create your chart environments based on your preference to the quickness of your decisions.
2. My chart increments: 7, 49, 343, 2401, 16807, 117649 etc. When creating your charts fractally then the extreme oscillations on a fast chart become the trading oscillations on the next slower chart . . . and so on. You will begin to see the perfect progression of price over different increments within the same market. Consolidation is no longer relavant because to see which direction consolidation will breack out, go to the next slowest one or two charts. Consolidation on one chart is a clear extreme top or bottom on a slower one.
Quote from Dackster:
Why was JHs post removed? That was one of the most interesting posts i've read on here.
Good post, Jack.
I was watching vingbel and I was hoping he might get around to some key Q's.
Sometimes, it is not fair to suggest what a person think about nor the order in which to develop a thought process.
It turns out, as we now see, Slapshot has made a suggestion that works and slapshot takes exception to my generic post on a common routine used in PA trading.
I follow PL's comments and we have a lot in common. vingbel is working with him too.
vingbel feels the thread had been highjacked and he wanted to return to his perception of just what is on topic.
I attached the 20 question warm up. And I do not want to take this thread OT. It is only a warm up for really getting down on using the DOM to trade at high velocity.
Tape reading (old style reading the T&S; modern times reading the DOM and stretch/squeeze and tic P, V) is extremely profitable and getting a person up to speed on it takes at least a week. Most excellent platforms let you run though 6 1/2 hours of RTH in 40 minutes (under your pause or real time or fast forward control). It is a real tear when it kicks in for a beginner.
Attachments
Quote from slapshot:
Ah, but the TRADERS themselves make time-based decisions, in fact the majority uses some kind of time-based increment to make buy/sell decisions. Therefore trader behavior is also reflected in time-based charts.
You are correct but not ALL decisions are based on the noise of time. Some trader behavior is reflected in time-based charts but it isn't a perfect reflection of ALL of the behavior. You as a trader want to trade from a standpoint of consistency correct? Then you need to take ALL of the information that price movement is giving you (time based decisions as well as all other based decisions) and meld them it into a consistent and readable environment to trade from. Eliminating all of the variables in your charting is a perfect place to start.
Slapshot, look at it another way.
Any decision you make you want all of the information available to you so that the decision outcome is as accurate as possible. Anytime you purposely ignore any part of the information or is any part is tainted due to inconsistency or if the skewed in any way, it will adversely effect the outcome of that particular decision.
Any decision you make you want all of the information available to you so that the decision outcome is as accurate as possible. Anytime you purposely ignore any part of the information or is any part is tainted due to inconsistency or if the skewed in any way, it will adversely effect the outcome of that particular decision.
Quote from ProfLogic:
Slapshot, look at it another way.
Any decision you make you want all of the information available to you so that the decision outcome is as accurate as possible. Anytime you purposely ignore any part of the information or is any part is tainted due to inconsistency or if the skewed in any way, it will adversely effect the outcome of that particular decision.
Not to go OT, but at some point all decisions to take action are, in the limiting case, the same for exit and entry. A decision is a response to an end effect of price excursion. Luckily, the trading platform has a particular type of trade that involves both an exit and an entry. This type of trade, the reversal, is the one we all best observe on the DOM and the indicator(s) simultaneously.
Quote from ProfLogic:
1. No, all of my decisions are based on oscillations. Whether the oscillation on a chart is created quickly or slowly makes no difference. Question: Would you prefer your trading decisions to be made slowly and methodically or quickly and potentially with greater margin for error? You create your chart environments based on your preference to the quickness of your decisions.
2. My chart increments: 7, 49, 343, 2401, 16807, 117649 etc. When creating your charts fractally then the extreme oscillations on a fast chart become the trading oscillations on the next slower chart . . . and so on. You will begin to see the perfect progression of price over different increments within the same market. Consolidation is no longer relavant because to see which direction consolidation will breack out, go to the next slowest one or two charts. Consolidation on one chart is a clear extreme top or bottom on a slower one.
Okay, I beginning to get your style... I think!
1) You look at oscillations between two points? S and R? Or two other points? Trend lines?
2) Then you trade as the price bounces off these extremes and you determine entries an exits by using a smaller time frame within a larger one?
3) When you use, 7, 49, etc., are you referring to multiples of seven of volume, ticks or what? Like 7000 shares, etc.?