Trust me, it's all a fantasy, I've seen the real deal.
ROTFLMAO!
Volume analysis is to be discarded as it is "too much information"
- Thread starter Buy1Sell2
- Start date
ROTFLMAO!
LOL, +100
Thanks, Ivan, I didn't know that!
I like posting at night because by the time morning arrives no one will ever see it. One reason the A-Team and the B-Team are often at each others' throats is that at least B-mers are systematic traders who test, whereas most if not all the butts of our cynical analyses are not. Now I respect Ehorn, he seems to be bright and an OK guy, but I am going to pick on him anyway because he needs it.
I spend half of my time discovering brilliant trading systems. And the other half debunking them through embarrassing testing. It is humbling simultaneously to be a genius and an idiot. It is axiomatic in trading that when you are inventing a system only the incredibly prescient calls stick in your memory. Testing usually reveals all the rest of the calls that suck that give the system negative expectancy. IMO the example Ehorn provided falls in the former category. Which, I suspect, is why the A-Team disdains testing. That plus the fact that their intraday futures "system" is not systematic at all. I will not debate that some of them make money. But I will argue that if so they don't know why, and would make a lot more if they did know why and refined it.
I DO know that prominent B-mers make money with systems or approaches that bear utterly no resemblance to SCT and don't use volume. Since we are all trading off the same time-price series, it should make the A-Team wonder at the validity of what they believe, given that dunces like us can make money without using SCT, and in fact use systems an order of magnitude simpler.
I spend half of my time discovering brilliant trading systems. And the other half debunking them through embarrassing testing. It is humbling simultaneously to be a genius and an idiot. It is axiomatic in trading that when you are inventing a system only the incredibly prescient calls stick in your memory. Testing usually reveals all the rest of the calls that suck that give the system negative expectancy. IMO the example Ehorn provided falls in the former category. Which, I suspect, is why the A-Team disdains testing. That plus the fact that their intraday futures "system" is not systematic at all. I will not debate that some of them make money. But I will argue that if so they don't know why, and would make a lot more if they did know why and refined it.
I DO know that prominent B-mers make money with systems or approaches that bear utterly no resemblance to SCT and don't use volume. Since we are all trading off the same time-price series, it should make the A-Team wonder at the validity of what they believe, given that dunces like us can make money without using SCT, and in fact use systems an order of magnitude simpler.
Your recent posts are super informative. Well done.
Trader zones adds some facts as well; the simple definition of a volume non signal. But volume also deals with market status as was noted by a professional form London. Art, for sure, has the poop on a good read.
So the thread has come to a focus that will allow almost anyone to take up volume as a tool for trading.
When you announced your missing peice among all the pieces, it was such a terrific moment.
TSganngalt had explained the seminal nature of using market variables in the construction of reading markets as time passes. The London pro interjected the market equilibrium comment. Art gave the one of the ancient references for the theorems of the market.
Pro rata volume, for any fractal (Mandelbrot....lol) allows a person to "Know" at the beginning of a time segment what the volume will be at the time the ATS (or if you trade manually) decision is made. These are milliseconds calcs into the time period. Or for humans a matter of the seconds required to calc a ratio periodically through a forming bar.
As was pointed out all one had to know (see TSganngalt) was whether or not a trough or peak of volume had just occurred. FYI, Traderzones, neither involves your, what is called in math, a non signal.
Your past problem in correlating volume and the price action you now use has just gone away. Henceforth, you CAN do the corrolation, flawlessly.
The "bouncing ball" script that was introduced years ago tells you the nextbar's volume at the end of the bar. For the one pager and using a 30 minute chart on stocks it tells you what will be the lookup value 30 minutes ahead of time. Scoring resolves the question of the next step in the cycle. For Traderzones there are several scores that tell you the PRV doesnot generate a signal.
by thinking through the pieces that comprise knowing a complete data set for anticipating a trade, read Art's book reference. With that list, you see you have reported all the components except the components for the mi8ssing variable you formerly could not integrate into your data set.
Of course, this is all criptic and difficult to understand for a moment. That moment ends when you put the "Bouncing Ball" on your display. Art does have it on his display and so does the London pro. Crudely "unusual volume" on Qcharts is a "daily PRV relatively speaking. It simply moves the stocks that are eligible to give you a signal into a group at one place (long or short) at the top of a Hot list.
so why doesn't trader zone understand whether our prints are posted or our logs are posted. They were when times were different. That is before ET and in early ET. Then the forums of the web did not have OCD's and policing wasn't part of forums. Today you can see the "good old days" on two types of forums: invitations only and the forums that are purposeful rather than primarily entertaining. Look at the contemporary volume discussions in those places any day of the week.
If in the other kinds of forums (like contemporary ET) prints and logs are posted to show the money velocity of trading with our paradigm, the whole conversation turns to greedy people trying to duplicate the trading by controlling the discussion. These people can overrun a site and destroy the dialogue among purposeful participants.
Notice how trader zones puts Tdog on ignore. See him use large fonts to destroy thread after thread by wrecking the opportunity for people at inquiry. There is NO way he can contribute. Not with even an Excel that has all the stats at the bottom.
Pro Rata Vol is your final missing piece. Make a list of the fualts you had with volume (you did it already). PRV cures each one in advance. the cure allows you to differentiate volume into two categories. Non signal volume and signal volume. Any volume information that is not a signal is a status indicator of the market. Market status with no signals is called either Wait or Hold. Wait is where you look for "time outs"; that is, when nothing happening comes to an end timewise. there are many times during the day when nothing may be done except wait while in a trade.
The other aspect is called making money. This is when volume status is telling you through non signals to HOLD since it is a time when money is being made.
Suppose you stuck to your guns on how to keep track of things (keeping performance with and without volume to figure out volume's influence).. Go ahead and do that once again. But this time put PRV into the picture so you have a leading indicator of what price is going to do. Once you are trading with leading indicators of price, trading becomes very different. The scary part is adding contracts from profits before you adjust to making so much money so quickly.
When imentored I always gave a check to the mentoree. He could fill it in if he needed to cover any losses. Funny thing, when the mentoree was considering adding contracts, he wasn't thinking about filling in and cashing my signed check.
A person can look at prints and logs: his and especially how contracts are added as time passes.
If you trade as TSganngalt suggests (the peaks and troughs, and you get used to the way the London pro uses volume to establish the market equilibrium, it will be an entirely different world. But please do not post your logs or prints. the money velocity the market offers is way beyond what most people believe is possible. Let it go at 3/4's to 1.5 times the ATR for a month. Do the Wait and do the HOLD. As you get used to being told by the market what it is offering (and being in the market all the time), coherence arrives. There is NO choice like trader zone faces (fight of flight ALL of the time). you will move away fron incoherence simply because you now know ahead of time what is going to happen as the bar begins.
You may figure out fairly quickly that between each profit taking there is a lot of time. All that time available comes from all the time it takes for volume to move from one leading signal moment to the next leading signal moment. smnoking a cigarette is shorter, lunch is shorter, mostly every common activity a person does is shorter than the beginning trade interval when working with volume.
LOL
"Crazy Ass Jack Hershey" just stopped by and ruined the argument for the volume works group.
"Crazy Ass Jack Hershey" just stopped by and ruined the argument for the volume works group.
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Quote from jack hershey:
A thought on volume. One of volume's greatest handicaps to traders was how the platform vendors tied it to an axis. Intellectually, this was unnecessary and actually needs to be avoided.
You can see that gradually over time the more successful annotators of volume leave the anchoring to an axis behind to the same extent that price is no longer anchored to an axis. As we see some indicators are anchored to an axis and others are not. Does this deny some information content to the representations?
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Could you expand on this please?
Are you saying volume should not be plotted to a time axis?
My post above used TSganngalt incorrectly. I see another name should have been used that has gann in it. Sorry.
As to the above Q's these are the kind that appear about once every five years.
Use Tufte as a reference. for the issue involved.
For most people volume cannot be processed mentally simply because of the form of the information displayed.
To remediate this difficult and pervasive dilemma takes quite a bit of thinking.
The bouncing ball, if used, takes a great deal related to axis anchoring off the table.
Imagine you use a bouncing ball and you glance at volume periodically. You see volume that happened and the gap up to the ball is the volume that remains to be completed by the end of the bar. you also see surges of volume with resepct to that gap.
If you also have added market pace (a rainbow for me) as rays that are set by a lookup table of 20 days, then you see the London pro's concept of price equilibrium appearing on volume rather that just on price.
the time axis is horizontal and the scale shows time passing. I actually have a bar count axis so the bar I am narrating on Skype or the other vidoe level communications is more meaninful since I refer, as do many, to the way the market calibrates itself at various times of the day.
for me the PM breakout is measured by the big money needs to take care of business after "settlement" (after the mail and wiring is settled). Then people go into the markets for different reasons.
I need to see those reasons on volume. we all know how who is doing what is shown by market data and the assorted displays for this. Volume if anchored (anchored means each bar begins on the time axis at the beginning o9f the set time of the forming bar.
Your platforms are deficient unless you have several and each is specialized for certain types of data. trader zones has less that four separte subscription feeds of data, for example. (he does not talk about several sets of specialized market raw data). QED.
Price is suspended on its pane. Volume must be suspended too after a certain skill level is reached. This is a calm statement and not a rant or arrogant comment.
I use price bars that are not candlesticks. Candlesticks distort by adding area to a linear quantity.
as a bar forms, how it is forming is informative. Which side of the BBid/BAsk is important. This must be put onto an unanchored bar. If it is you can see the same data as seen on price incremental additions relative to prior additions.
We see in 100millisecond clips. Our sisplays must support our human sensing facets. This is not a latency comment but a "melody" type comment. we are reading the markets in a mental way that exceeds reading books or magazines or looking at pitures. It is more on the level as described by Oliver Sacks in his latest on the brain.
Volume has PRV (See above). A ball referenced to an axis is not the best of bests. The ball is terrific though and remove several factors of anchoring. we know how "tall volume is by PRV. Where should that vertical length be place in time to inform us the most? Where it formed and where it placed then there is an envope that is much like the price envelopes developed long ago. Also the Gann aspect is introduced for volume. so is the fibbinocci aspect. Gaps appear as well (gaps in price do not exist actually, but they do in volume that is placed informatively).
I felt it was important to not allow any part of a volume bar to touch or cross the time axis. In informative displays this is easily achievable.
By now you may have thought a bout CVB's for price. If you have you have discovered the loss of information that occurs in terms of market equilibrium. here I am expanding the volume discussion to begin the process of introducing infomation content. Braithwaite dealt with bandwidth. Price has "internals" in trending. They are called patterns and formations. Volume does likewise.
For me I want to see the people dimension of market participation. the SEC recognized me right off when they got computerized. These mistakes they made were both humorous and poignant. On one hand I was visible. On the otherhand their computers were non functional. Today, I continue to look at people according to their importance. People are a leading indicator of price. Market observers watch people to determine their advantages.
So volume raw data is important. Processing it is divided into two matters. The status of the market and market timing signals. Once the display is dissassociated from an single point of anchoring, volume takes on many of the analyzable characteristics of price which is commonly not anchored (by the accident of the axis being so remote).
If you follow the history of scientific innovation in finance you remember seeing the way price was handled by the early innovators. Dow is a good example.
Case for examining the participants and their behavior is more significant than price. The best case, as I see it is how to be a parasite of the significant participants. So once in a while (five years in ET) a question gets asked.
How markets work is mostly a function of the participants and it turns out to be very counterintuitive in terms of how thinking is done by just regular people. fortunately things are not as difficult as one would imagine. Control usually lies with the rich (C+ history liberal arts majors from Ivy League schools). Those they hire do what they are told.
So now and in the years ahead, the consequences of the last 25 to 40 years are catching up with the greedy. Reading their behavior is the name of the game.
The present objective is to extract capital (parasitically) from this crippled system and then apply it to solutions that cannot be effected by the system that is passing out of existance.
The contemporary electornic analytic powers of non probabilistic information theory make all this possible. It has to be done deductively and by using an orientation to null hypothesis type testing that involves the correct parametric measures. Binary vectors become the only choice for this logical resolution.
What is nice is the edge attained as compared to induction and its inherent large resulting sigmas.
Quote from jack hershey:
A thought on volume. One of volume's greatest handicaps to traders was how the platform vendors tied it to an axis. Intellectually, this was unnecessary and actually needs to be avoided.
You can see that gradually over time the more successful annotators of volume leave the anchoring to an axis behind to the same extent that price is no longer anchored to an axis. As we see some indicators are anchored to an axis and others are not. Does this deny some information content to the representations?
--------------------------------------------------------------------------------
Could you expand on this please?
Are you saying volume should not be plotted to a time axis?
My post above used TSganngalt incorrectly. I see another name should have been used that has gann in it. Sorry.
As to the above Q's these are the kind that appear about once every five years.
Use Tufte as a reference. for the issue involved.
For most people volume cannot be processed mentally simply because of the form of the information displayed.
To remediate this difficult and pervasive dilemma takes quite a bit of thinking.
The bouncing ball, if used, takes a great deal related to axis anchoring off the table.
Imagine you use a bouncing ball and you glance at volume periodically. You see volume that happened and the gap up to the ball is the volume that remains to be completed by the end of the bar. you also see surges of volume with resepct to that gap.
If you also have added market pace (a rainbow for me) as rays that are set by a lookup table of 20 days, then you see the London pro's concept of price equilibrium appearing on volume rather that just on price.
the time axis is horizontal and the scale shows time passing. I actually have a bar count axis so the bar I am narrating on Skype or the other vidoe level communications is more meaninful since I refer, as do many, to the way the market calibrates itself at various times of the day.
for me the PM breakout is measured by the big money needs to take care of business after "settlement" (after the mail and wiring is settled). Then people go into the markets for different reasons.
I need to see those reasons on volume. we all know how who is doing what is shown by market data and the assorted displays for this. Volume if anchored (anchored means each bar begins on the time axis at the beginning o9f the set time of the forming bar.
Your platforms are deficient unless you have several and each is specialized for certain types of data. trader zones has less that four separte subscription feeds of data, for example. (he does not talk about several sets of specialized market raw data). QED.
Price is suspended on its pane. Volume must be suspended too after a certain skill level is reached. This is a calm statement and not a rant or arrogant comment.
I use price bars that are not candlesticks. Candlesticks distort by adding area to a linear quantity.
as a bar forms, how it is forming is informative. Which side of the BBid/BAsk is important. This must be put onto an unanchored bar. If it is you can see the same data as seen on price incremental additions relative to prior additions.
We see in 100millisecond clips. Our sisplays must support our human sensing facets. This is not a latency comment but a "melody" type comment. we are reading the markets in a mental way that exceeds reading books or magazines or looking at pitures. It is more on the level as described by Oliver Sacks in his latest on the brain.
Volume has PRV (See above). A ball referenced to an axis is not the best of bests. The ball is terrific though and remove several factors of anchoring. we know how "tall volume is by PRV. Where should that vertical length be place in time to inform us the most? Where it formed and where it placed then there is an envope that is much like the price envelopes developed long ago. Also the Gann aspect is introduced for volume. so is the fibbinocci aspect. Gaps appear as well (gaps in price do not exist actually, but they do in volume that is placed informatively).
I felt it was important to not allow any part of a volume bar to touch or cross the time axis. In informative displays this is easily achievable.
By now you may have thought a bout CVB's for price. If you have you have discovered the loss of information that occurs in terms of market equilibrium. here I am expanding the volume discussion to begin the process of introducing infomation content. Braithwaite dealt with bandwidth. Price has "internals" in trending. They are called patterns and formations. Volume does likewise.
For me I want to see the people dimension of market participation. the SEC recognized me right off when they got computerized. These mistakes they made were both humorous and poignant. On one hand I was visible. On the otherhand their computers were non functional. Today, I continue to look at people according to their importance. People are a leading indicator of price. Market observers watch people to determine their advantages.
So volume raw data is important. Processing it is divided into two matters. The status of the market and market timing signals. Once the display is dissassociated from an single point of anchoring, volume takes on many of the analyzable characteristics of price which is commonly not anchored (by the accident of the axis being so remote).
If you follow the history of scientific innovation in finance you remember seeing the way price was handled by the early innovators. Dow is a good example.
Case for examining the participants and their behavior is more significant than price. The best case, as I see it is how to be a parasite of the significant participants. So once in a while (five years in ET) a question gets asked.
How markets work is mostly a function of the participants and it turns out to be very counterintuitive in terms of how thinking is done by just regular people. fortunately things are not as difficult as one would imagine. Control usually lies with the rich (C+ history liberal arts majors from Ivy League schools). Those they hire do what they are told.
So now and in the years ahead, the consequences of the last 25 to 40 years are catching up with the greedy. Reading their behavior is the name of the game.
The present objective is to extract capital (parasitically) from this crippled system and then apply it to solutions that cannot be effected by the system that is passing out of existance.
The contemporary electornic analytic powers of non probabilistic information theory make all this possible. It has to be done deductively and by using an orientation to null hypothesis type testing that involves the correct parametric measures. Binary vectors become the only choice for this logical resolution.
What is nice is the edge attained as compared to induction and its inherent large resulting sigmas.
No worries, Mr. Hershey.
I knew who u meant. They have shortened my name down to ARGT or just Gann.
Continue ur work, it is rooted in sound trading principles. Wyckoff comes to mind often when reading ur and ur students work.
Jack, thank you so much! Your posts created a time machine that carried me back to my youth! I remember quite clearly at age four lying flat on my back on a grassy lawn, gazing transfixed at the complex cloud formations above me, and seeing in them god. At age eight in the wee hours of the morning while everyone else was asleep I got up and turned on the B&W television and saw fantastic nether realms in the pure noise of no TV signal. And now at age 64 your schizoid word salad made sense to me. I thought divine madness was a thing of the misty past! Wonders never cease, even at my age!