Volatility in the US indexes

Quote from whitster:

again, it depends on methodology.

if u can't recognize that, then that would explain why many fail to capitalize on changing market structure

it reminds me of all the people who are complaining there has been no volatility, when soybeans have been off da hook for volatility
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if you NEED to trade volatility, then go where the volatility is. otherwise, adapt to the market you are trading
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that's besides the point. u cant say that u prefer to trade low vola, that dont make sense. if u are given the choice of a vix goin' back to 50 or back to 10 what would u prefer. traders strive and love volatility because they can find more opportunities. look at all the currencies funds as of late..they all took a pounding cuz of low vola.

commodities are volatile but not exactly the easiest mkt to trade.
 
Quote from Bitstream:

well, ask uself why traders became millionaires in the late 90s, i mean that was champagne sluts and angel dust all along..as rm says...and why...maybe cuz vix was at 50? ror. i mean, would u rather prefer to trade 200points ym ranges or 30points..of course if u are a sclaper after a few ticks a day it may not make any difference but hell u can seriously capitalize on high vola.
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Yup... I only take 1-2 trades a week as of right now and nowhere near the size I used in the past. That is my adjustment to the lower vix and my form of risk management. Again eveyone is differnet....
 
"u cant say that u prefer to trade low vola, that dont make sense"

yes, it does. my primary trading methodology is low point scalps over and over again in the dow minis.

i PREFER a low volatility environment. why is that hard for u to understand?

on a day like today, i can still make money but it is not my optimal trading environment, at least partially because the majority of my trade setups have been developed in a low volatility environment.

i scalp the dow for income. i like low vola enviro because it provides a smooth equity curve with minimal risk.

if that doesn't make sense to you, then u need to expand your knowledge of trading beyond "breakout" or "trend following" methodologies and realize there are many ways to skin the market cat.

i am saying that not ALL traders seek higher volatility.

and agian, corn v. soybeans is the perfect example
 
Lets try this as a review of todays action. Personally i got the first swing for 10 handles in ES and then was asleep at the switch the rest of the day like a complete idiot. (bad habit and needs to be corrected for next year).

The review: Today on the 5 min we had 4 major swings for a total of "TRADABLE" handles = 51 3/4.

Swing #1 from 1404.50 down to 1391.00, (thats where i pulled out the 10 handles from -6 line @ 1402.00 down to 1392.00)

Swing #2 from low of 1391.00 up to 1401.75

Swing #3 from 1401.75 down to 1387.50

Swing #4 from 1387.50 up to end of day @ 1400.75.......Total for day = 51 3/4

Ok, bottom of first swing was a key reversal bar followed by a higher bar that closed on ther high...........a CLEAR signal to get long. ( i was asleep on that one)

OK, top of second swing = another 2 bar reversal (as i call them), this one did not have a key reversal bar at the top but the second bar was a CLEAR wider bar that closed well below the first high bar of this upswing. That was the second 2 bar reversal i missed (still resting on the laurels of taking out a 10 bar swing and 35 handles for the week), complacency is a drag.

Ok, bottom of swing 3 #1387.50 = another 2 bar reversal (this one should have come up and slapped me for being so dam blind). Another key reversal at the low followed by a second bar that never went but a tick below the close of the key reversal bar at the low and this second bar closed close to its high. A CLEAR signal to get long. I was asleep again, went up 13 1/4 handles into the close.

This review is not to brag about how good i am, i know how good and how bad i can be, the review is more as an example of just how easy this is and can be if one is focused and awake. Todays swings were made for daytraders and to think they are giving clear signals to boot. Dam, next week i think they might start ringing bells for guys like me to get real and bring in some more bacon.

Good luck, i hope this review opens some eyes. Lets have some more fun next week., Thks......:) :cool: :cool: :cool: :eek:
 
PS, here is how i might filter the 2 bar reversal trades. The +6/-6 line trades are for trading off the opening of the pit session, thats a totally different strategy than taking 2 bar reversal trades.

Say you spot a 2 bar pointy reversal trade and the second bar closes in the top 20% of the breakout. (breakouts have a bad rap as being head fakes).

OK, watch the top of the second bar for 2 more bars and see if the closes are close to the close of the second bar, if so on the next bar take a trade as soon as this bar ticks psst the high of the last 4 bars ( the 2 bar reversal and the following 2 bars). this filter should at least get you a few good ticks and at worse give you a scratch if you do not see good follow through. Enjoy the ride. :D :p :cool: :cool:
 
interesting, bighog...

see, this is a perfect example of how people trade very differently and that there is more than one way to skin a market cat.

i would never trade like your method, but if it works for you great.
 
Quote from myminitrading:

This happens when we approach the end of the futures contracts, the big swings are used to unwind futures positions with out tanking the markets.

Roll over will take place in a couple of weeks.
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Also INCREASED volatility is a sign of intermediate/long term tops and bottoms..... :)

Look at those LOWS in 2002 to 2003.....:eek:
 
whistler

I agree with your contention that "others" will trade what makes them feel comfortable. We all must find the light in our own way.

The above statement is my way of saying to the folks that constantly drive me nuts when they say you must never give out your so called "SECRETS" because then others will trade the snot out of your grail and it will disappear. That is more ego stroking than truth. THERE ARE NO SECRETS!!!!!

In any profession, the basics will always apply, they are as valid today as they were for Jesse Livermore and the crowd before him. Where did Jesse get his ideas from? (ya, i know he blew brains out later in life but it will not dispel the truth of his prior dealings).

Check this out..........the more a small trader like myself uses basis simple ditties and the more it was revealed, think of how it indeed would actually "ENHANCE" setups because others would see value in said setups. Many traders can not get a grip on that statement because they want to intellectualize trading far beyond what brings home the bacon.

Leave the Quant stuff to the big boys and big pretty girls, BE SMALL BUT STAND TALL............. :D
 
Quote from bighog:


The above statement is my way of saying to the folks that constantly drive me nuts when they say you must never give out your so called "SECRETS" because then others will trade the snot out of your grail and it will disappear. That is more ego stroking than truth. THERE ARE NO SECRETS!!!!!
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LOL, I totally agree with the above. Everyone is worried if they tell people the methods of their trading it will no longer work. If it truly has an edge it will continue to work. By the time it has enough volume of traders to begin to fade your system you will have already made your fortune.
 
i agree about the secrets thing. i don't feel they are some sort of earth shattering grail like mysteries. otoh, my general methodology, my risk management principles, etc. do have positive expectancy and do make money. i DO trade mentoring for a fee, and i do not GIVE it out for free. if that's selfish fine. i readily admit that it would take a LOT of traders using my setups wiht a LOT of volume for the edge to dissapear. it aint gonna happen overnight.

most successful traders i know don't have much in the way of secrets, they merely have skill and a good methodology, and most importantly - DISCIPLINE. they must be ruthless with discipline. everything else is secondary.

that's actually a big part of how i mentor. i teach discipline, first and foremost. here's one "secret". i train people with a heart rate monitor attached. that is an excellent biofeedback method and lets you know when you are getting emotional. it's a great method.

that will be 5,000 dollars please :)
 
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