you are trying to tell me that there are constant relationshps that willl always exist and be able to be exploited? so what worked 3 years ago still works today?
What kind of techniques do heavy scalpers use?
- Thread starter CFerret
- Start date
you are trying to tell me that there are constant relationshps that willl always exist and be able to be exploited? so what worked 3 years ago still works today?
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Quote from jack hershey:
Luckily, there is an alternative to your viewpoint.
The relationships are measurable and they demonstrate a sequential relationship.
It is like the second hand of a clock counting off the time in a very standard manner.
We see it. We use it. We extract the profits.
you do not agree. That is just the way it is.
--------------------------------------------------------------------------------
Your response in bold:
you are trying to tell me that there are constant relationshps that willl always exist and be able to be exploited?
I feel that I am saying A and you see or hear it as B.
A can be exploited. B needs to be adjusted somewhat.
For example: The stretch/squeeze indicator leads the ES index when the indicator is providing an exploitable signal.
The signal appears 20 to 30 seconds before the action on ES. The signal persists for 2 to 3 minutes after the signal peaks in value. This is a very comfortable situation for a trader who is making money by staying in the market all of the time and using signals to stay on the right side of the makrt.
This is not a signal that can be used by most people, however. First of all it is not the usual entry exit type signal since it is signalling two things at once: an exit and an entry. Most people think in terms of entries then exits. (Look at your recent print for entries, exits and the time you are in and the time you are out of the market.)
By being in the market all of the time, a person thinks in terms of holding and reversing. Reversing is an exit and entry at the same time.
I state above: "The stretch/squeeze indicator leads the ES index when the indicator is providing an exploitable signal."
In that sentence there are the words: "when the indicator is providing an exploitable signal."
Again, I am "trying to tell you something".
A close reading is suggesting that the signal is not there all of the time. Most signals do come and go over time. It makes their presence more helpful for the one thing that you point out good signals do: they provide for exploitation.
All 17 leading indicators that I use provide for exploitation of the lagging indiex being traded. About 25 exchanges are being traded successfully using some or most of thee signals depending upon skill levels.
The nature of the stretch/squeeze signal is very very instructive for those who invent stuff. By looking at it come and go you get to see how the transients of an independent and a dependent pair of price functions work. One is used to arbitrage the other it turns out. So that knowledge is exploitable too.
It is like watching two autos go through a city with traffic lights that control the flow. Thier frequent spacing keeps both cars in the same blocks but the drivers have differing styles. One is a teenager and the other is a chauffer of an expensive car.
They drive near each other in adjacent lanes most of the time going in the same direction at the same maney velocity.
At trafic lights the teenager moves away from the intersection after the light changes in a manner that wastes fuel. He goes first and has the carbuerator accepting the maximum fuel immediately.. He later starves the fuel supply to let the over accelerated car slow to the maximum speed of the block he is driving in. The expensive car with three times the cyclinders comes along side the teenager's 4 cylinder car and they stay at the speed limit until they reach the next light.
This shows the "long" squeeze and the "short" stretch where the teenager is "smart money " on the YM and the cash is the expensive car. It also shows the jump start ("leading") aspect and the period of persistence in the lead and the peak of the difference between the two.
Most of all it shows that the normal state of the stretch /squeeze is a band of plus or minus two points that is similar to "road noise".
We also monitor and adjust the "fair value" of the offset between the two by regression analysis. This is done in steps to log the frequency of the regression required and the sum of the steps is used to determine when certain aribitrage techniques become playable (capable of paying the premium to play).
There are other expert level aspects involved as well. I haven't done any advanced intermedite ofr expert stuff in ET but that will be done this year in a while.
so what worked 3 years ago still works today?
It seems that there is a myth in ET and elsewhere that techniques and exploitable mechanisms come and go with the times. You may believe this as a matter of fact.
For me this myth does not matter since I do not engage on that turf. It is like I cannot imagine making 40 points on the ES per month either. Why would anyone engage in making 40 points a month as a goal?
The above example deals with something that is always there to exploit. I have only seen it working consistently for 50 years so far. That is about 16 times the 3 years that you mentioned for some reason.
I do not anticipate that trending segements that go in long or short directions will cease anytime soon. The smart money will be there as usual gunning their hot rods. there will always be cash and futures indexes of one sort or another.
PC's and software are relatively new but there always was paper t run notes and logs on so the data processing has been around forever.
exploitation
Exploitation is a thing of degree.
We differ greatly on this.
You are at the "constantly" and "always" and "all the time" stage of reasoning.
When a conversation comes up and the other person has gotten it straight that he or she is hearing an underestimation of what is being accomplished, then it is time to continue to talk to that person. If the person feels he or she is hearing an overestimation, then there is little to talk about.
We spent some time in Chicago recently. real time real money real trading.
Condensing four screens onto one laptop made it interesting.
narrating 5 bars ahead made it interesting.
Putting a finger on a screen to shown the next turn coming up in time shoed that both time and price are understood to be what they will be.
Taking 70% of the offer at 2.5 times the H-L in the first hour of a Friday was significant to others. That when they figured out how we undervalue our performance. the 30% not taken was simply a consequence of going flat to be able to handle a pressing topic. doing two things at once is ineffiicient when it comes to money.
Exploiting the markets IS the name of the game. Nothing else is.
First you have to be able to se the markets.
Second you have to get it straight that what you are seeing is never going to change in character. What is real is there and it is always there.
Next, there are about three principles that have to be used. These must be used to exploit.
1. be in the market to make money (When it is open)
2. Be on the right side of the market when you are in the market.
3. Take profits from price change in segments that are as long as the given segments of price movement.
You only use signals from displays and coding that sequence ahead of the market at the times when you need those signals. They are there when you need them and they work in sequences like clockwork. You only trade in NOW with the "sufficiency" of non probabalistic contraction info gap empirical mode. (Ben-Haim , 2007)
Quote from jack hershey:
Luckily, there is an alternative to your viewpoint.
The relationships are measurable and they demonstrate a sequential relationship.
It is like the second hand of a clock counting off the time in a very standard manner.
We see it. We use it. We extract the profits.
you do not agree. That is just the way it is.
--------------------------------------------------------------------------------
Your response in bold:
you are trying to tell me that there are constant relationshps that willl always exist and be able to be exploited?
I feel that I am saying A and you see or hear it as B.
A can be exploited. B needs to be adjusted somewhat.
For example: The stretch/squeeze indicator leads the ES index when the indicator is providing an exploitable signal.
The signal appears 20 to 30 seconds before the action on ES. The signal persists for 2 to 3 minutes after the signal peaks in value. This is a very comfortable situation for a trader who is making money by staying in the market all of the time and using signals to stay on the right side of the makrt.
This is not a signal that can be used by most people, however. First of all it is not the usual entry exit type signal since it is signalling two things at once: an exit and an entry. Most people think in terms of entries then exits. (Look at your recent print for entries, exits and the time you are in and the time you are out of the market.)
By being in the market all of the time, a person thinks in terms of holding and reversing. Reversing is an exit and entry at the same time.
I state above: "The stretch/squeeze indicator leads the ES index when the indicator is providing an exploitable signal."
In that sentence there are the words: "when the indicator is providing an exploitable signal."
Again, I am "trying to tell you something".
A close reading is suggesting that the signal is not there all of the time. Most signals do come and go over time. It makes their presence more helpful for the one thing that you point out good signals do: they provide for exploitation.
All 17 leading indicators that I use provide for exploitation of the lagging indiex being traded. About 25 exchanges are being traded successfully using some or most of thee signals depending upon skill levels.
The nature of the stretch/squeeze signal is very very instructive for those who invent stuff. By looking at it come and go you get to see how the transients of an independent and a dependent pair of price functions work. One is used to arbitrage the other it turns out. So that knowledge is exploitable too.
It is like watching two autos go through a city with traffic lights that control the flow. Thier frequent spacing keeps both cars in the same blocks but the drivers have differing styles. One is a teenager and the other is a chauffer of an expensive car.
They drive near each other in adjacent lanes most of the time going in the same direction at the same maney velocity.
At trafic lights the teenager moves away from the intersection after the light changes in a manner that wastes fuel. He goes first and has the carbuerator accepting the maximum fuel immediately.. He later starves the fuel supply to let the over accelerated car slow to the maximum speed of the block he is driving in. The expensive car with three times the cyclinders comes along side the teenager's 4 cylinder car and they stay at the speed limit until they reach the next light.
This shows the "long" squeeze and the "short" stretch where the teenager is "smart money " on the YM and the cash is the expensive car. It also shows the jump start ("leading") aspect and the period of persistence in the lead and the peak of the difference between the two.
Most of all it shows that the normal state of the stretch /squeeze is a band of plus or minus two points that is similar to "road noise".
We also monitor and adjust the "fair value" of the offset between the two by regression analysis. This is done in steps to log the frequency of the regression required and the sum of the steps is used to determine when certain aribitrage techniques become playable (capable of paying the premium to play).
There are other expert level aspects involved as well. I haven't done any advanced intermedite ofr expert stuff in ET but that will be done this year in a while.
so what worked 3 years ago still works today?
It seems that there is a myth in ET and elsewhere that techniques and exploitable mechanisms come and go with the times. You may believe this as a matter of fact.
For me this myth does not matter since I do not engage on that turf. It is like I cannot imagine making 40 points on the ES per month either. Why would anyone engage in making 40 points a month as a goal?
The above example deals with something that is always there to exploit. I have only seen it working consistently for 50 years so far. That is about 16 times the 3 years that you mentioned for some reason.
I do not anticipate that trending segements that go in long or short directions will cease anytime soon. The smart money will be there as usual gunning their hot rods. there will always be cash and futures indexes of one sort or another.
PC's and software are relatively new but there always was paper t run notes and logs on so the data processing has been around forever.
exploitation
Exploitation is a thing of degree.
We differ greatly on this.
You are at the "constantly" and "always" and "all the time" stage of reasoning.
When a conversation comes up and the other person has gotten it straight that he or she is hearing an underestimation of what is being accomplished, then it is time to continue to talk to that person. If the person feels he or she is hearing an overestimation, then there is little to talk about.
We spent some time in Chicago recently. real time real money real trading.
Condensing four screens onto one laptop made it interesting.
narrating 5 bars ahead made it interesting.
Putting a finger on a screen to shown the next turn coming up in time shoed that both time and price are understood to be what they will be.
Taking 70% of the offer at 2.5 times the H-L in the first hour of a Friday was significant to others. That when they figured out how we undervalue our performance. the 30% not taken was simply a consequence of going flat to be able to handle a pressing topic. doing two things at once is ineffiicient when it comes to money.
Exploiting the markets IS the name of the game. Nothing else is.
First you have to be able to se the markets.
Second you have to get it straight that what you are seeing is never going to change in character. What is real is there and it is always there.
Next, there are about three principles that have to be used. These must be used to exploit.
1. be in the market to make money (When it is open)
2. Be on the right side of the market when you are in the market.
3. Take profits from price change in segments that are as long as the given segments of price movement.
You only use signals from displays and coding that sequence ahead of the market at the times when you need those signals. They are there when you need them and they work in sequences like clockwork. You only trade in NOW with the "sufficiency" of non probabalistic contraction info gap empirical mode. (Ben-Haim , 2007)
From Friday's chat log:
Hershey has taken simple channel trading and made it as complicated as possible combined with this 3*H-L, $10000, to $1M in one year, always in the market, etc. etc., etc., to conduct a hoax on new traders. No different than MarketMonk, Fxxxx Sxxar and others that come onto ET to do the same.
As the truth comes out, as it is little by little, the underlying 'approach' will be little different than any other long existing channel system both in practice and results.
http://www.elitetrader.com/ch/DigiC...t/Transcripts/Elite_Trader_Chat/20070427.html
Soon after Hershey posted for the first time in this thread,Spydertrader (Apr 27, 2007 12:38:13 PM)
Jaack just intentioanlly makes things sound complicated to weed out the idiots
Spydertrader (Apr 27, 2007 12:39:10 PM)
Well, jack normally leaves out the part about price using the ENTIRE channel for increasing or decreasing
Spydertrader (Apr 27, 2007 12:39:22 PM)
Just as he leaves out YM leads price at (points of change)
resinate (Apr 27, 2007 12:39:26 PM)
ja, that is common strategy
Spydertrader (Apr 27, 2007 12:39:27 PM)
he just says YM leads ES
Spydertrader (Apr 27, 2007 12:39:35 PM)
and allows people to determine their own meaning
Now we have an 'end effects' mode!!!??? So, YM does not always lead ES as taught for the past 10 years?
Hershey has taken simple channel trading and made it as complicated as possible combined with this 3*H-L, $10000, to $1M in one year, always in the market, etc. etc., etc., to conduct a hoax on new traders. No different than MarketMonk, Fxxxx Sxxar and others that come onto ET to do the same.
As the truth comes out, as it is little by little, the underlying 'approach' will be little different than any other long existing channel system both in practice and results.
http://www.elitetrader.com/ch/DigiC...t/Transcripts/Elite_Trader_Chat/20070427.html
From a post above:
"so what worked 3 years ago still works today?"
What worked 100 yeras ago still works today.
I happened to look over zillions of commodity charts and stock charts from different countries over the years and personally subscribed to services since the late sixties and I can categorically say that the patterns of price movements have not changed.
Actually it is amazing that price behavior did not change (I guess because it is determined by human factors).
Perhaps because of the increased liquidity the patterns that we have been used to seeing on daily or weekly charts now also show up on the micro time scale down to the one minute or tick charts.
This should give young traders hope. Once you understand the dynamic nature of market action you can successfully trade anything anywhere.
Regards,
GC
"so what worked 3 years ago still works today?"
What worked 100 yeras ago still works today.
I happened to look over zillions of commodity charts and stock charts from different countries over the years and personally subscribed to services since the late sixties and I can categorically say that the patterns of price movements have not changed.
Actually it is amazing that price behavior did not change (I guess because it is determined by human factors).
Perhaps because of the increased liquidity the patterns that we have been used to seeing on daily or weekly charts now also show up on the micro time scale down to the one minute or tick charts.
This should give young traders hope. Once you understand the dynamic nature of market action you can successfully trade anything anywhere.
Regards,
GC
My own experience so far confirms that there are appropriatenesses in the markets which repeat again and again and don't depend on instrument or time frame and as such don't seem to likely cease soon, because why would an occurence that is seen on say AAPL daily, GBPUSD 4H and ES 5 min would cease it's existence since it seems to be an integral and critical part of any market that is worth trading at all (provides enough liquidity and volatility).
i was speaking in terms of lead - lag correlations, not market behavior or patterns
i was speaking in terms of lead - lag correlations, not market behavior or patterns
IMO in terms of lead-lag correlations there is almost always something that leads and something that lags at least in some market conditions.
I guess Jack meant that and not the exact given instrument vs. instrument correlation, because neither YM nor ES existed 50 (and even much closer to now) years ago...