Wild Day range on ES

T

tikutka

Guys,

You have noticed that during last days after this Tuesday the day range on ES is around 25-30 points.I have expected that after this Tuesday it will be back to normal(maximum 20 pnts),like it was many years up to now.What do you think,will it continue like that from now or soon we will get back to what we had before in 2006.Please share your opinions.Really appreciate that.

Thanks.
 
Quote from tikutka:

Guys,

You have noticed that during last days after this Tuesday the day range on ES is around 25-30 points.I have expected that after this Tuesday it will be back to normal(maximum 20 pnts),like it was many years up to now.What do you think,will it continue like that from now or soon we will get back to what we had before in 2006.Please share your opinions.Really appreciate that.

Thanks.
More...

Volatility Analysis -

Exploit the increased volatility while you can especially if you think it will go back to what ever you consider to be normal.

However, if you think volatility is going to continue rising or be at similar like levels as we've seen today and yesterday...

Now is the time to backtest your strategy or review your strategy for its performance during similar like price action of the distance past so that you'll be better prepared especially if your a newbie trader that has not experienced this type of volatility (most are scared and/or frustrated).

With that said, I hope volatility doesn't drop to what we saw for the year of 2006 while not being as strong as we have seen these past two trading days.

Rising volatility is good as long as it doesn't cause an increased level of fear.

Mark
 
Thanks,Mark.

Actually I was praying for this kind of moves the whole February.
:D :D :D
I've heard some traders here who was doing this in 90s saying that during those days a normal day range on ES was around 40-50 points and just could not imagine how this is possible just physically.:D :D :D
This volatility is OK for me,it's even better as you can easily get 7-10 ES points if you are correct.During last 2 years while I was trading everything you could expect is just 1 day a week with good intraday volatility.Now it's really different.
Mark,my broker told me that during this Tuesday many accounts was blown out and many positions were closed 'cause of margin calls.Do you think this large moves on ES is due to the fact that there are less participants on futures market or what?Just your personal opinion.

Thank you.
 
<i>"my broker told me that during this Tuesday many accounts was blown out and many positions were closed 'cause of margin calls."</i>

Those are the reversal traders who play fiscally suicidal games like using -2 / +1 risk-reward ratios, and especially the gang who average down when markets go against position while expecting a turn to save them. As they painfully learned, those saving turns don't always come in time.

That type of crap was taught by some big-dollar course marketers during unusually low volume periods. Now that high volatility has returned for a bit as everyone knew it would, those high-risk tactics are devastated.

Just the usual weeding out process... seen it all before.

The wild swings we're seeing now come from all manner of traders literally "freaking out". From individuals trading one-lots to hedge funds employing similar tactics above who encouraged untold $$ millions this week, the extreme shift in volatility is shaking proverbial trees.
 
Quote from tikutka:

Guys,

You have noticed that during last days after this Tuesday the day range on ES is around 25-30 points.I have expected that after this Tuesday it will be back to normal(maximum 20 pnts),like it was many years up to now.What do you think,will it continue like that from now or soon we will get back to what we had before in 2006.Please share your opinions.Really appreciate that.

Thanks.
More...
=================
tikutka
Interesting brokers comment on lots of margin calls/blow ups;
probably due to 50 plus points trend instead of 10-20 range usually.

Sometimes things change after theyre posted:D
Even though much of tuesday was fairly orderly, last 2 afternoons have been fairly orderly.Somewhat typical wild downtrend/sharp rally rest of time.

And not necessarily as deep or trendy as tuesday[ES];
but have noticed many stocks also change personality below 50 day moving average.

Not a prediction but exspect ES to move more wildly like lately ;
until it starts really uptrending again.:cool:
 
Quote from tikutka:

Thanks,Mark.

Actually I was praying for this kind of moves the whole February.
:D :D :D
I've heard some traders here who was doing this in 90s saying that during those days a normal day range on ES was around 40-50 points and just could not imagine how this is possible just physically.:D :D :D
This volatility is OK for me,it's even better as you can easily get 7-10 ES points if you are correct.During last 2 years while I was trading everything you could expect is just 1 day a week with good intraday volatility.Now it's really different.
Mark,my broker told me that during this Tuesday many accounts was blown out and many positions were closed 'cause of margin calls.Do you think this large moves on ES is due to the fact that there are less participants on futures market or what?Just your personal opinion.

Thank you.
More...

I've been trading the Eminis soon after their birth...

I remember the days of the huge range...great trading for trend following methods and trend reversal methods.

Horrible trading for counter-trend traders.

In those days, you can take a hit for a 3 point loss and still turn around to catch a nice 10 - 15 point move.

Recently (prior to the last few trading days), you take a 3 point loss and your day is almost over with.

Simply, I was using wider stops in the old days of the Eminis due to the high volatility (it didn't seem high at the time) in comparison to smaller stops the past several years due to declining volatility.

Yep, volatility bursts like the last few trading days causes more account blowups and margin calls than any other trading conditions...

Especially for counter-trend traders or those that average down.

Do you think this large moves on ES is due to the fact that there are less participants on futures market or what?
More...

No...I don't think there's was just one reason nor a primary reason.

I think there was a lot of different reasons that finally came together to make trading very exciting again...

The recent price action is the talk of the town and even CNBC, Bloomber, RobTV ratings have skyrocketed these past few trading days.

:cool:

I hope it continues and if it does...we need to adapt our trade managment.

Mark
 
Thanks guys.

Still hoping the market will be like this at least this year.:D :D :D
Sure,it sounds like a newbie but it's so human to belive that good times will last as long as possible.:D :D :D
Today was just an excelent day, so clear and solid moves.Mornig was a bit choppy,but then during a lunch time a good move down,then market was sitting at 1388 on ES which is pretty strong level,then tried to go up(I was long there but closed at breakeven) and then a very nice move down where you can easily go with even 1.5 pnts stop.I wanted to short when market could not break through 1396 but last month made me so scared that it'll be just another chop-chop before the end of the session that i just sat and watched.Anyway it was a pleasure to look at this movement down.And day range is again good 25 points.I'll keep my fingers crossed the market will keep going like this.:D :D :D
 
Quote from tikutka:

...What do you think,will it continue like that from now or soon we will get back to what we had before in 2006...

Thanks.
More...
No. Back to "normal" (meaning low VIX) in a month, max.

nitro
 
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