Tradestation - Bid/Ask Volume Analysis
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leveragefx
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Sorry wasn't clear. eSignal's data has about 150 banks that makeup their data. Some banks have wide 8, 10 or 12 pip spreads and they can move their bids by 4 or 5 pips at a time. You don't want to trade off of a tick chart if you don't know the REAL high or low of each bar or swing high/low. A 35 tick chart just means that any time any of these banks adjust their bid by moving it up or down that is 1 trade. When 35 trades happen a new bar happens. If the market goes up 100 pips you still see that in a 35 tick chart but it just updates the moving avg and keltner channels faster so that a tiny pullback in price gives you a GREAT entry. In a real uptrend by the time the market hits the lower keltner on a 5 min chart the trend may have already changed!
What they do is let you filter by banks with spreads under X pips, I used to use 3 but also let you select WHICH banks to use. They take esignal's tick data and create the bars themselves. The banks I posted seem to be honest, ie they don't run stops or have wide WICKS! I want to know real swing highs/lows because I'm a big double top/ double bottom trader! I really need to know what my REAL risk is. If I short a double top I may exit if it goes 5 pips over but if a BS tick is 5 pips too high I'm risking more than I need to and it doesn't give me confidence and I can't at times do 10 lots, need to cut size down due to inaccuracy of charts. If you look at esignal's charts for forex you will see how dirty their data is due to some of the banks.
The probability bands in the software use each currencies volatility to show these reversal levels. All I know is that it works and gives me 5 to 10 trades a week that make me money. I just trade what works, if somebody shows me an easier way or more fun way to make money in forex I'd trade that way.
Chris
leveragefx
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Quote from 5Pillars:
So you are using Esignal "currency options" data to make your volatility bands measurements on a separate chart....correct?
(sorry....I can be slow at times)
No not at all. eSignal currency options don't tell you implied volatility, that needs to be derived. Go study Black Scholes option pricing theory. It's way too complicated a formula to be discussed here and obviously am not going to give away a trade secret anyway. I've already revealed a system almost anybody who can exit a losing trade when wrong (most can't) can make money with.
leveragefx
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Just search for LeverageFX on paltalk or you can see it under
Business and Finance/Day Traders/
It's toward the top with 50 to 80 traders in there most of the time.
Quote from leveragefx:
No offense to the tool you use but this is far superior. This chart shows both the 100 lot traders and how much they are buying/selling on each bar compared to the statistical average of past 20 days. On the bottom it shows how much the STOCKS that makeup the S&P are being bought or sold on each bar.
Here's why Market Delta is sometimes good but FAR from the holy grail as it can't do this. Notice the first bar of the day the big 100 lot traders bought about 263% more than normal while selling was 224% above normal. The CASH market had 378% buying but 974% selling! The institutions were dumping stocks on the open. It doesn't matter that the big lot traders were buying futures the market went down. The mutual funds and hedge funds DOMINATE the S&P! It's nice to know what traders in futures are doing, especially 100 lot traders but far more valuable to know what the mutual funds and institutions are doing.
This chart also shows the avg hourly high and low which is critical to trading the S&P, keltner channels and balance point line for today and continuous through yesterday. The green balance point line shows where most traders have positions from yesterday and today.
On the bottom I watch all the stocks that makeup the S&P and see how many are above or below their VWAPs. When 60% are above the market tends to trend up nicely, when 60% are below it will trend down. When between the white lines you can safely buy lower keltner or avg low or short upper keltner or avg high.
Again, in my humble opinion, 100X better than Market Delta because it shows not only how much buying and selling is going on in the futures but shows you STATISTICALLY how much/little. It does the same for stock buying/selling (best market sentiment tool I've ever traded with) and also shows you statistically safe buy and sell areas. And they have some buy/sell signals on the charts too that also tend to give me profitable trades. The white dot shows market has gone down too much and is likely to reverse, I start looking for buys when I see that, just wait for the buying in the stocks and futures to come in and buy, can't get easier than that. I tried Market Delta for probably 3 months and it required too much thought and analysis. I want to look at the charts and say wow the big futures traders and stock traders are all selling 200% more than normal and 70% of stocks that makeup the futures are below their vwaps, I want to short ever rally up to resistance in this case and instead of scalping 1 to 2 points maybe hold on for 3 to 6 point move.
Question: Will Top Gun will go as low as 1 minute bars - I would assume so - but just need to be sure ?
cj...
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leveragefx
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Actually it goes lower as it can do tick based bars. It even does BIG trader tick based bars which isn't in any other program.
For example suppose instead of 89 trades per bar you want each bar to be 10 trades of 100 lot sized traders and above. This way when heavy institutional traders are trading there are lots of bars, when they are out of the market there are few bars. I've found the keltner channels and bollinger bands with BIGLOT tick bars much more accurate than time based charts or normal tick based charts.
Impressive... :eek:
thanks
cj...