The best of the two NQ systems is trading 1 NQ contract, and has done well. The other systems are still paper trading because their risk isn't as low and I donât have enough capital to trade them all. Analysis and execution are automatic and do not require monitoring, except for adverse situations like Globex shutting down.
Using ES Time and Sales
- Thread starter traderkay
- Start date
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On TWS I arrange my columns from left to right as shown in the attachment.
What you see is that the center of my view is on the Last Price.
The number of contracts are on each side of this center column.
I am looking to see which way the market is going. I make money as it goes in the direction of my position. The smaller number of the two is my direction.
You see the Bid is on the left. If the bid is smaller, then I am short. I make use of a rule to do what I do. The rule is that the market is controlled by the traders who are in the minority.
It comes from mercantile principles first espoused when civilization was just getting down to doing business. The jargon and quaint expressions that grew from this business effort fall into two primary expressions. They are hard to grasp.
A "sellers" market means that the merchant is in charge of setting the price. He has more business than he can handle. Supply is not enough to cover demand.
A "buyers" market is the opposite. There is too much corn and the price goes down. To sell corn the price has to be lowered to get people to buy it.
When people do intraday trading, they just tool along doing anything they want. I do not do that. I only do what is required to continually make money as the day goes by. I look at the market as either a "sellers" or a "buyers" market. This is foreign to some people and bullshit to others.
It is difficult to grasp how to continue to make money in the market at all times. I am writing up a paper at this point to fully illustrate this. The tentative title is "Staying on the right side of the market". Markets have two sides. I call them "buyer" and "seller" side. You can see that a lot of ET people do things that reveal they cannot deal with this concept. I like it for one reason. This makes traderkay call me an asshole in this thread. I wrecked the thread by suggesting T&S is a good way to keep on the right side of the market. If you stay on the right side of the market, you make money all the time.
Some times I am a seller, sometimes I am a buyer. I just look at the TWS row for indexes as I arranged it and see which side to be on. There is a price in the middle. On each side are two numbers. One is bigger and one is smaller. I look at their ratio as well. I decide the be a seller or a buyer by picking the small side to be on all the time.
The bid stuff is on the left. The the ask stuff is on the right. The crunch comes in understanding bid and ask. It requires reasoning on some level to enter the market on the correct side and then see the trend continue to make you money. But that is what I do. I use the small number to do my entry. Now I am in and I watch. Trading is "eating" up my number until it runs out. Another price appears because the one that was eaten up is empty. The eating continues. Sometimes there are many there to eat and the other side is showing fewer.
This makes watching anything but boring. I alway have my next trade lined up to transmit. Hey why not. I know I am going to use it when there is no more money making going on. I have to click T to reverse. I click T when the number becomes smaller on the other side. Well it does fool around a little. THe Bbid and Bask change as pairs. I notice that. also at that moment two new numbers appear. The smaller number usually stays on the same side so there is never any split second timing required. nothing is jumpiaround anyway.
On IB there is a column labelled Unrealized P&L and below it is Quantity. This is the pinwheel part of trading. as you watch the small number, you see these numbers keep getting bigger mostly. The units and tens values pop along and give you repeated discrete values. The hundreds and thousands columns act as altimiters do when you are flying after take off to gain cruising alitude. As you watch the small number and stay on the right side of the trade, you just patch together buys and sell to act as the person on the right side of the market. When it is a "buyers" market, you are a "buyer". When it is a "sellers" market you are a seller. You are on the right side of the market all the time by following one rule. That keeps you in control and you never give up control.
Notice that this does not involve stops or targets or their ratio. thee is not drawdown concept nor it there any win lose ratio concept either. They can be made up though. There are statistical methods for everything. Professional baseball leads in this field as I understand it. Johnny Cash suggested not counting chips while you play. That is a good idea if your attention is being demanded by risk and the unknown. In this case because you just watchtwo numbers and see which is smaller, you are not too challenged. It is like playing poker with transparent cards. Only assholes do that as you can see.
Grob, I'm following your concept of watching which side is being "eaten" faster. I do something similar when entering. I use charts to determine the trend, but then at point of entry, I will fine-tune the entry a bit by watching which side is being "eaten" quicker.
-FastTrader
Edit: Even though I'm following what you're saying, I don't think it's that simple
-FastTrader
Edit: Even though I'm following what you're saying, I don't think it's that simple
Quote from Fast_Trader:
Grob, I'm following your concept of watching which side is being "eaten" faster. I do something similar when entering. I use charts to determine the trend, but then at point of entry, I will fine-tune the entry a bit by watching which side is being "eaten" quicker.
-FastTrader
Edit: Even though I'm following what you're saying, I don't think it's that simple
I know I am poor at communicating. What I ws emphasing is that the small side is the side that goes to zero contracts first. I sometimes think I see both sides eaten. Actually I know I do. Those eating on the others side are a group designated: "losers".
90% of the traders "eat" on the wrong side.
The above pictures will help me make my point. Fast eating is not the point. The point is that the small side gets eaten up soon. Then the new price that becomes the "best" whatever usually starts with a smaller number again and it disappears faily rapidly because it is a small number primarily.
BEing in the trade on the side that is smallest then lets you continually make money. Munch munch.
I am realy so happy to see you getting oriented to this.
It is one of the easiest KISS approaches that nails multiples of the daily H/L each and every day.
Grob,
This is alot of fun reading and trying to learn you're concepts. They seem sound to me so far. Thanks for sharing.
Here's a quote from something you said Wednesday....
"Because I keep my NLP pictures really clean, I do it like breathing."
What are NLP pictures?
Also, you mentioned something about colors changing on the TWS display and this was important. While watching the bid and ask depth today on the TWS, the colors were changing from red to green quite a bit. I'm not getting what you meant with the color changes in addition to the smaller price etc.
Thanks,
jd
This is alot of fun reading and trying to learn you're concepts. They seem sound to me so far. Thanks for sharing.
Here's a quote from something you said Wednesday....
"Because I keep my NLP pictures really clean, I do it like breathing."
What are NLP pictures?
Also, you mentioned something about colors changing on the TWS display and this was important. While watching the bid and ask depth today on the TWS, the colors were changing from red to green quite a bit. I'm not getting what you meant with the color changes in addition to the smaller price etc.
Thanks,
jd
This is some great stuff Jack. Just trying too get this stuff soaked in. I am really trying too understand what you are saying but I find myself being somewhat confused. I put ?? under the parts i am confused about.
I also wanted too mention a picture i have and i am not sure if it is correct. I often see the Bbid smaller than the Bask and people eating away at the ask until it is gone and moving up another level with the same thing happening. The bid is smaller than ask but ask is getting eaten up. I think my pictures are opposite of what they are suppost too be.
Thanks
jc
I also wanted too mention a picture i have and i am not sure if it is correct. I often see the Bbid smaller than the Bask and people eating away at the ask until it is gone and moving up another level with the same thing happening. The bid is smaller than ask but ask is getting eaten up. I think my pictures are opposite of what they are suppost too be.
Thanks
jc
The item to look at is the number of contracts.
It is difficult to communicate thoroughly.
If you look at prices, you will see that the bid is smaller than the asked.
Personally, I assume mostly everyone knows that fact.
I have a personal picture of trading that is a desk and two lines of people.
They are in groups. If a person enters the picture he can go to any group on any side.
It is difficult to tell anyone how to look at the T&S or the TWS of IB. But I just look at it as a table with two lines.
In detail the bid is on the left. All these people want to buy.
The people who want to sell are on the right.
They come to the table as their group prices are nearest to each other. Think of the groups as having a placard with their price on the placard.
you are looking at placards and you discovered tat the placards on the left side are lower than the placards on the right side.
It is that way every day.
What I am looking at is the size of the groups.
At the front of the two lines one groups is smaller than the other.
To make it interesting I will say the ask group at the front is smaller.
As the matching goes on between the askers and the bidders, the askers get used up sooner. That is because they are a SMALLER group.
Over the years I have noticed that at any given time, most of the groups with their different placards in one line are smaller groups that the bunches on the other side.
Each time an ask group is used up the market rises. With smaller groups on one side the market keeps going that way.
I trade at market, so I go to the front of the both lines and say whether I want to buy or sell. I do not fool around. I enter so that what I have will become more valuable to me all the time.
I may be either in a "sell" (short mode or in a "buy" (long) mode.
for me to continually make money I look at group sizes. Groups sizes are measured in contracts. They are not measured in points. Placards are used for that and I do not think of what placard I want to be associated with. I want to be associated with the line that has the smaller groups.
Trading to make money by just looking at whether you have a "seller's" market or a "buyers" market is difficult. It is the "accumulation" "distribution" question. People in ET do not use A/D indicators. I do on TWS of IB. It is a number that is the smallest number of two numbers. Contracts for Bbid or contracts of Bask. B means the group is at the front of the line. One group is smaller. I hang out with the side of the line that has smaller groups.
It comes down to the fact that the minority controls the market. So I go look to see who is the minority and join up with them.
Interestingly enough, the losers go with the majority.
If you ever wondered why rich people are in the minority it is because they usually pick the right place to be at the right time.
If you have ever wondered why "buy and hold" is so dumb; here is a way to find out.
It is difficult to communicate thoroughly.
If you look at prices, you will see that the bid is smaller than the asked.
Personally, I assume mostly everyone knows that fact.
I have a personal picture of trading that is a desk and two lines of people.
They are in groups. If a person enters the picture he can go to any group on any side.
It is difficult to tell anyone how to look at the T&S or the TWS of IB. But I just look at it as a table with two lines.
In detail the bid is on the left. All these people want to buy.
The people who want to sell are on the right.
They come to the table as their group prices are nearest to each other. Think of the groups as having a placard with their price on the placard.
you are looking at placards and you discovered tat the placards on the left side are lower than the placards on the right side.
It is that way every day.
What I am looking at is the size of the groups.
At the front of the two lines one groups is smaller than the other.
To make it interesting I will say the ask group at the front is smaller.
As the matching goes on between the askers and the bidders, the askers get used up sooner. That is because they are a SMALLER group.
Over the years I have noticed that at any given time, most of the groups with their different placards in one line are smaller groups that the bunches on the other side.
Each time an ask group is used up the market rises. With smaller groups on one side the market keeps going that way.
I trade at market, so I go to the front of the both lines and say whether I want to buy or sell. I do not fool around. I enter so that what I have will become more valuable to me all the time.
I may be either in a "sell" (short mode or in a "buy" (long) mode.
for me to continually make money I look at group sizes. Groups sizes are measured in contracts. They are not measured in points. Placards are used for that and I do not think of what placard I want to be associated with. I want to be associated with the line that has the smaller groups.
Trading to make money by just looking at whether you have a "seller's" market or a "buyers" market is difficult. It is the "accumulation" "distribution" question. People in ET do not use A/D indicators. I do on TWS of IB. It is a number that is the smallest number of two numbers. Contracts for Bbid or contracts of Bask. B means the group is at the front of the line. One group is smaller. I hang out with the side of the line that has smaller groups.
It comes down to the fact that the minority controls the market. So I go look to see who is the minority and join up with them.
Interestingly enough, the losers go with the majority.
If you ever wondered why rich people are in the minority it is because they usually pick the right place to be at the right time.
If you have ever wondered why "buy and hold" is so dumb; here is a way to find out.
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