Trading The SPI - NON-Gann Techniques

[Trembling Hand]

So my 2 weeks "experience " trading the SPI is just a part of 14 yrs charting.
Guessing even experienced guessing has in MY view no place in trading or any other business venture.

Tech is Frank "guessing" and therefore not a legitimate way to carry out a business??

 

[cuttlefish]

Analysing the psychology behind the flows, is a large part of it for some. Who is trapped? What is that spoof? Does he want his fill and is really trying to get people to attack his direction to get better fills before going to market to finish up (driving the price up if his spoof was originally on the bid, because he actually wanted fills) or is he simply trying to drive price the other way to get fills on the other side (i.e. he is spoofing the bid, so people frontrun him and he puts his orders in the book on the ask to get short)? Some take opinions and form a bias at certain times, while other times purely rely on DOM, some never take a bias and purely trade off DOM.

DOM is not the be all and end all, it is just another tool to be used, which can add a big advantage at certain times. Other times, it doesn't help a bit, whilst others, it can be more of a hinderance. Knowing the difference is the hard part but the key.

You cant be serious?

You dont actually believe that there are people out there who from the movement in orders on and off the board,can become expert in the psychology of those who are placing and withdrawing these bids.
To such a degree they trade large parcels which take real kahuna's (Whoa I bet it does) with massive percieved confidence.

And you wish to emulate that type of trading?

Infact fund managers are searching these people out!
These people look after our superfunds and the worlds currencies!

God help us!

Yeh I know I just dont have any idea.
Ignorance is bliss and profitable

Tech - when you are applying VSA you are often looking for tests/confirmation. It makes sense to me that a larger player, when seeing support (or resistance) come in (lets use support for the example) will not want to wait for the market to test the results but will run their own testing.

So for example if there is rising volume appearing as a down move occurs and the move slows we're trying to determine if the demand is sufficent to overcome supply or if its possible the demand is simply support while supply is fed in before support being pulled and the down move continuing. (and this new down phase will be fed by a large amount of the recent support level demand that has turned around and rolled over into supply as it saw its support levels breached.)

We we as small players can watch for this and look for the confirmation signals that tell us which it is - but a larger player I'm assuming will run their own testing.

e.g. when a down move slows, put a few sell orders on a bit higher up in the ask (not too much just a little bit of volume) then run the price up to that supply level - see if demand comes out of the woodwork and takes that supply - if it does add a bit more - watch how strong the demand is - if the testing shows the demand isn't sufficient put some proper big orders on the bid and feed out the rest of supply inventory - instantly pullling and replacing the support orders if they get hit by any non-trivial volume - maintain this while most of the supply is fed out - then pull the support orders and feed remaining supply into the thin depth to push price down and flush out further supply. If further supply isn't forthcoming to enable restocking of the inventory or rollover of the support level, then run back up over the small amount of supply that did appear then put a larger order back down on the even smaller amount of demand that follows it up (this is fairly safe because there won't be much because it was already tested a minute ago). Then increase inventory by buying up at the lower price, pulling and replacing the large sell orders on the offer if they get hit by anything but non-trivial volume.

etc. etc. - I probably haven't been that clear but you know the sort of thing I mean - its pretty obvious that there is some of it going on - everyone is probably trying to be more clever than the next person- big players being played by the even bigger players etc. - but close observation of this action can provide a lot of information about the supply/demand equation.

 

[wayneL]

Get a grip how fast do you think
(1) I can type.
(2) Place an order buy or sell
(3) Photograph a realtime chart.
(4) Load it all onto this server.

I reckon Ive done the best Ive seen.
Good on me.

Ha ha and there are 4 ticks between posts.

Bronte /Austin

Those longs look good?
Or are you out?
Out I guess--hope.

I repeat, You invented the rules.

Charts can come later. The trade call needs to be ASAP.

eg I bought XYZ @ 2345 within a couple of minutes, otherwise, it just ain't live.

Surely you can live by your own demands on others?

 

[tech/a]

Tech is Frank "guessing" and therefore not a legitimate way to carry out a business??

I'm still reading Franks work (In between typing).
I'm impressed with what Ive read so far and also Franks thought process.No he's not guessing from what Ive read .

Wayne

I was making a point with the VSA charts if I didnt post the charts as soon as I evaluated it then I would have been accused of hindsite again.

I wont be posting any more Trades Ive posted enough of that stuff and have made my point.
So when do I get my "Rules Moderator" status?

Cuttle I will reply later when I have some more time sorry!

 

[prawn_86]

Breaking it right down to base level, ANY form of trading is guessing.

Tech you are still guessing, you do not know with 100% accuracy that the trade will work, hence there is some uncertainty, so its a guess. If you are wrong you cut your losses short

And dont go on about positive expectancy, because scalpers have proved numerous times over that their methods can be profitable.

 

[cuttlefish]

Deja Vu...

I recognise that ego from somewhere. :

There has been some very dodgy and nebulous calls here.

If folks want to post actual entries and exits, do it immediately. "Guess where I'm short from" doesn't cut it.

Tech, you know the rules, you invented them.

For the amount of time he's been posting here I'm happy to give tech enough credibility to believe he's posting in real time. I'd like to know if they are paper trades or real trades (its easierr to forget paper entries/exits that didn't work ) - and of course as the critics are pointing out - a few good days/trades doesn't necessarily equate to long term success, so it will be interesting to see how this all unfolds.

 

[Trembling Hand]

Ok so Frank will trade from what he sees playing out over the next 10, 27, 44 point moves from patterns he has historically found. That's legit.

I trade the next 3 ,6 ,12 to 40 ticks from patterns I have historically seen repeat often enough to make some $ from but that's not?

 

[tech/a]

Prawn does make an interesting point one I dont have time to answer today.
T/H your point also needs more time than I have so will return tommorow.

 

[lesm]

Breaking it right down to base level, ANY form of trading is guessing.

Tech you are still guessing, you do not know with 100% accuracy that the trade will work, hence there is some uncertainty, so its a guess. If you are wrong you cut your losses short

And dont go on about positive expectancy, because scalpers have proved numerous times over that their methods can be profitable.

Define guessing.

There will always be a degree of uncertainty, but is it an absolute guess, or an informed guess or decision, based on probabilities from statistical data, historical experience, or an experiential basis. If it is the former (absolute guess) may as well use a blindfold and pin or throw darts or take random entries/exits.

If a trader identifies that a particular set of patterns or characteristics, regardless of the underlying basis, give him/her a basis upon which to trade profitably and consistently, isn't that what really matters at the end of the day

Positive expectancy is an overused or abused term and hides a number of potential sins or is used as a throw away term. There is a need to consider the overall consistency of any given approach through time.

Cheers.

 

[MS+Tradesim]

Positive expectancy is an overused or abused term and hides a number of potential sins or is used as a throw away term. There is a need to consider the overall consistency of any given approach through time.

This is a very good point. I can come up with any number of ideas that have positive expantancy but the variance in return, the frequency and size of drawdowns, etc. mean I would never trade them.

I would say positive expectancy is a good starting point but agree that consistency and smoothness of the equity curve have to be the next steps. People trade their beliefs. If you can consistently make money doing so, then the variations in methodology don't matter one iota.

But this is a digression from the thread.

 

[Frank D]

There is guessing, and then there is pattern recognition and
probability, which is what traders need to use to be successful,
whether it's my work or other methods shown throughout this thread or
pure mechanical systems.

We have a Friday breakout of the Weekly lows @ 3426 and heading down,
as part of the Monthly trend down into January’s lows.

Today’s set-up was to short trade below 3426, but only after
price had risen 22 points, that would have set-up the perfect short trade
as it aligned with the Weekly lows and coming down from a R22 top.

That didn’t happen falling short by 4 points

So I went long around the channel lows and support @ 3366.

Once again bouncing 18 points but looking for a 44 point up move.

Once price couldn’t hold 3366, switched to shorts and looking for a
move down into Friday’s lows, and next r44 completion.

Friday’s lows @ 3339 and valid support zones matched by the R44 lows…

But we need to keep in mind that Actual trend of the market, if it can’t
hold 3339 then it’s simply part of the larger trends driving the market
lower.

Into longs now, but I already know the Risk of buying the market
around these levels today.

It’s been supported above 3339 now for nearly 1 hour but it’s not
bouncing, therefore I know the risk after 2pm if selling appears…

If price rises upwards into 3366 (resistance), but more more buying
appears, there could actually result in a HOOK bar over 3366 and
further Buying into the close.

There is no guessing in the market, that's for amateurs:- either the
market trends or rotates, and it's about finding levels in the market
that defines support and resistance, and trade as close to them as
possible.

Now I'm long in the most optimal level in the market:- sprial low and
5-day low, but the market will tell me if i'm right or wrong.

But because my morning set-up played out but not precise enough for me
to enter the trade, I’m left to scrapping out 10-20 point moves, and run stops accordingly, and knowing that if it breaks 3339 it's going lower.

 

[MRC & Co]

You cant be serious?

You dont actually believe that there are people out there who from the movement in orders on and off the board,can become expert in the psychology of those who are placing and withdrawing these bids.
To such a degree they trade large parcels which take real kahuna's (Whoa I bet it does) with massive percieved confidence.

And you wish to emulate that type of trading?

Infact fund managers are searching these people out!
These people look after our superfunds and the worlds currencies!

God help us!

Yeh I know I just dont have any idea.
Ignorance is bliss and profitable.

I made a post in reply to this, but just edited it.

No point replying.

 

[Cartman]

- everyone is probably trying to be more clever than the next person- big players being played by the even bigger players etc. - but close observation of this action can provide a lot of information about the supply/demand equation.

lol ....... i made a similar statement somewhere a while back re the big boyz and the bigger/biggest boyz ----------- people thought i was on drugs (not on ice though !! ) haha ---- hope u get a more favorable response C/F ----- like the way u think

ps this thread is kicking some serious butt ---- good stuff ----

 

[sails]

Is that an iceberg happening now at 3342?

EDIT: Was that an iceberg??

 

[tech/a]

I made a post in reply to this, but just edited it.

No point replying.

I actually read it MRC.
Can you tell me where I can actually go and watch these guys live.
PM me with details Id love to see it and will be in most states over the next 12 mths so wont be a problem.

Frankly MRC I think you'll do well scalping you have the ideal temperament.

 

[Trembling Hand]

I actually read it MRC.
Can you tell me where I can actually go and watch these guys live.
PM me with details Id love to see it and will be in most states over the next 12 mths so wont be a problem.

Tech why don't you give them a talk on what they do wrong. After all what would a group of traders that do 30% of the SPI vol daily, day in day out for years know.


You could maybe name your seminar "Why my way is better than yours" :

 

[tech/a]

Quickest I could post it up.
Short again.
Stop 48

 

[Joolean]

Haha. Very entertaining. Though I can't believe this kind of banter is going on amongst experienced traders.

That was an interesting read cuttlefish. Can you point me to the article you wrote Cartman along the same lines? I'm always interested in any information on the other participants in the game.

Cheers,
Jules.

And FWIW, Pepsi is better.

 

[peter2]

Interesting that the high vol breakout at 3380 earlier this morning turned into a false breakout and you waited for confirmation (next bar reversal) and on this occasion you took the high volume breakdown without waiting for the following bar confirmation.

Tech/a : How was this break out different to the earlier one at 3380?
Did knowing that 3339 was a Frank D support level influence you?

[btw: Thanks Frank D for the setup. ]

 

[Trembling Hand]

I'll play long at 3312 stop 3311