Volume--- how to use it and WHY

[jprad]

Quote from MandelbrotSet:

Yep

Just like with CONSTANT TIME bars and CONSTANT RANGE bars.

My charts show there is less different between the three of them than all the hair splitting in the world will accomplish.

Uh, you want to give that one more go?

Constant time bars do not build at a variable rate and constant range bars will, more often than not, build at a different rate compared to constant volume bars.

As for your charts, big whoop. It's not hard to come up with well-chosen bar values by reverse engineering the daily range and volume to "prove" your case.

Give up the parameters and let's play it forwards and backwards a few weeks to see how consistent everything looks when we have a wide-range, high-volume day.

 

[ProfLogic]

Quote from MandelbrotSet:

Yep

Just like with CONSTANT TIME bars and CONSTANT RANGE bars.

My charts show there is less different between the three of them than all the hair splitting in the world will accomplish.

And thanks for mentioning that I have no idea what you do ... I consider that to be a compliment.

No, on a CVB Chart only an established number of shares or contracts can be created per bar before a new bar is formed. During a major news report where large blocks of traders enter the market you will see large noisy spikes on time charts because you have a large number of volume traded per minute. My volume charts do not show the spike, just more bars are created. The smoothness of price is maintained.

Don't mention the compliment. I, like a lot of traders are used to dealing with people that talk about things they are clueless about. Sorry to say, you are no different.

 

[MandelbrotSet]

Quote from jprad:

Uh, you want to give that one more go?

You're boring me, but OK.

Quote from jprad:

Constant time bars do not build at a variable rate and constant range bars will, more often than not, build at a different rate compared to constant volume bars.

I explained the composite relationship between the three types of bars about five pages ago ... somebody needs to do their homework.

Quote from jprad:

As for your charts, big whoop. It's not hard to come up with well-chosen bar values by reverse engineering the daily range and volume to "prove" your case.

Yours (and ProfLogic's) lack of ability to understand what the charts displayed speaks volumes (... ) as to your lack of insight and understanding of what you are looking at when viewing a price chart.

Quote from jprad:

Give up the parameters and let's play it forwards and backwards a few weeks to see how consistent everything looks when we have a wide-range, high-volume day.

Yeah, lets do that, LOL.

P.S. I knew it was going to be a waste of time ...

 

[MandelbrotSet]

Quote from ProfLogic:

Don't mention the compliment. I, like a lot of traders are used to dealing with people that talk about things they are clueless about. Sorry to say, you are no different.

Funny, I feel exactly the same way about you and JPRAD.

Hey look, a meeting of the minds.

 

[ProfLogic]

Quote from Trader666:

Wow, how incredibly ignorant. Backtesting only gives "fudged" signals if you do it wrong and is orders of magnitude more efficient than forward testing. Take stocks for example... one can backtest a strategy on thousands of stocks over years of varying market conditions, to include OOS data, in minutes... while forward testing would take years. And there's no guarantee that the period you forward test on will be any more representative of future market conditions than the backtested data. In fact, just the opposite because forward testing is far more limited.

People back-test strategies for years only to blow up when applying them to live conditions. If you think back-testing is better than testing in real-time you are a fool.

PERIOD!

 

[MandelbrotSet]

Quote from ProfLogic:

Sorry Smurf but Constant Volume bars aren't created at various time intervals, they are created in real time, as they happen. The are created naturally not artifically in your time based charts. This is why your moving averages are worthless on my charts.

Nope.

The reason the moving average is worthless on your charts is because they are created using an artifiicial 7x7x7x7x7x7x7 rule, regarless of the indice traded.
***
Whereas the correct way to construct them would be to analyze the amount of volume that a market has on average, break that volume down by the number of (wait for it ...) minutes traded per session, and then use that value to construct your constant volume bars, which you would be using in lieu of constant time bars.
***
P.S. The readers are welcome, there's no need to thank me.

 

[MandelbrotSet]

Quote from ProfLogic:

People back-test strategies for years only to blow up when applying them to live conditions. If you think back-testing is better than testing in real-time you are a fool.

PERIOD!

Ah, there you go again.

Backtesting can yield information and insight that would not be known otherwise.

It certainly is important for the purpose of determining what concepts might be viable (as compared to being overly curve-fit and absolutely useless - see a jack hershey ATS currently being run by bwolinsky, LOL).

***

Not much need for me to run backtests mind you, I already know that price is fractal in nature and working with multiple time-frames is a proven method of trading success (on this Board, and in the real world ... ever hear of top down analysis).

 

[ProfLogic]

Quote from MandelbrotSet:

Funny, I feel exactly the same way about you and JPRAD.

Hey look, a meeting of the minds.

The major difference between us Jimmy is that I've studied price for almost 15 years and documented that research every step of the way. I am fluent with what I speak because I know it inside and out. I've torn apart minute charts, tick charts, range charts and everything in between and KNOW the differences between them like the back of my hand. I have over 40,000 hours studying charts and can detail the differences in most popular studies and break down their idiosyncrasies. I actually trade for a living and back it up by trading live in front of groups for educational purposes. I do not hide behind the internet and people actually come to my office to trade.

You on the other hand are part-time actor, part-time waiter, part-time busboy and a one lot trader that is absolutely enraged that someone could possibly know a bit more than you. You hide in the internet making snide remarks about people that you have never met nor know anything about. You lie about them and shrug it off as being inconsequential. You could be an asset to your community but prefer to play the "whiner" card. You are a product of your environment.

 

[ProfLogic]

Quote from MandelbrotSet:

Nope.

The reason the moving average is worthless on your charts is because they are created using an artifiicial 7x7x7x7x7x7x7 rule, regarless of the indice traded.
***
Whereas the correct way to construct them would be to analyze the amount of volume that a market has on average, break that volume down by the number of (wait for it ...) minutes traded per session, and then use that value to construct your constant volume bars, which you would be using in lieu of constant time bars.
***
P.S. The readers are welcome, there's no need to thank me.

Sorry, your lack of Physics and problem solving skills are showing.

 

[ProfLogic]

Quote from MandelbrotSet:

Ah, there you go again.

Backtesting can yield information and insight that would not be known otherwise.

It certainly is important for the purpose of determining what concepts might be viable (as compared to being overly curve-fit and absolutely useless - see a jack hershey ATS currently being run by bwolinsky, LOL).

***

Not much need for me to run backtests mind you, I already know that price is fractal in nature and working with multiple time-frames is a proven method of trading success (on this Board, and in the real world ... ever hear of top down analysis).

I was doing fractal (and fractional) research before you knew who Benoit was. Some of us here remember your posts as Jimmy Jam. Those posts are still searchable bud. You can come down off your pony now.