How I use pivot point clusters

[Soultrader]

Glad you like the site. That is a very interesting piece of software. Are you using it for your trading?

[ezduzzit]

No, I don't trade with that topgun software toolset yet. As I have mentioned I am somewhat of a newbie trader (anybody with less than 5 or 10 years is a newbie I think). As an ex-banker, I already knew that the big dogs move the markets and the fear and greed of the retail players like myself is not what moves the markets but what loses money in the markets as those big players lead us by the nose to and fro.

It took me a few months to get past the initial foolish holy grail indicator search but I knew there just had to be some tools in the market that really got behind the scenes to break out and show what the big dogs are doing as they do it. I looked at volume spread analysis briefly and then moved on to that marketdelta site. However a tip from a much more seasoned trader brought me to that topgunsoftware.com site and I was totally captivated by what I saw there.

I will be interested in hearing further opinions about it from you and other more experienced traders here in the forum who might have the time to give it a look-see. I watched the futures video a few times to distill the essence of what he was keying off of to trade and it just made so much sense compared to the drivel that most of us are told to follow in hopes of being successful each day.

[Soultrader]

I just watched the video for the first 5 minutes but it makes perfect sense. The reason it is appealing to me because all the informtion used in the software is pure info. As you may have noticed, I hate using indicators. But the topgunsoftware uses tools to understand the footprints of market participants. I may end up taking the free trial on their site. I found some tools that I may want to try out. Thank you for posting it out. I am sure alot of market profile traders may want to take a look at the software.

Are you currently trading the S&P's? What kind of methodology do you apply to your trading?

[ezduzzit]

In a nutshell, I looked at and trialed every trading indicator I could get my hands on and mostly found little of value. All those methods based on lagging indicators are a large part of the reason that 90+% of traders give away their money in the markets.

I finally moved to short period Jurik moving averages along with ADX with DMI (though not on standard settings) as my confirmation of momentum and timing of entry and exit, in addition to TICK and TRIN. That has worked fairly well, but hungering for better I looked briefly into market and volume profile. Dual auction theory and all was a great concept but I could see the info and tools available to trade it were rather pitiful until I stumbled upon this TG site we have been discussing here.

I do not trade the ES as I feel it is much too short ranged and cuthroat. I traded the YM but after several forays into the mini Russell I think I have found a home. Despite guru comments to the contrary I have found the mini Russell to provide the best bang for the buck at least during current periods. Your execution has to be good and you can't be timid, but it often trends better and smoother than the other two and it is hard to complain about the monetary returns either.

In my own trading I focus a lot on pivots and other S and R points that develop throughout the day and frankly, I learned more than anything else from a little method called Pivot Magic before running into market and volume profile ideas. At best, I would consider what I have been trading with as "moderate" probability trading, whereas what I have seen a glimpse of now which seems the real "high" probability trading. I don't want to say much more than that until I have had a chance to look into it further.

[Soultrader]

ezduzzit, what exactly is Pivot Magic? I have heard of it but I am not familiar with it.

Also, are you mainly a pivot based trader? Do you use market profile in your trading? It looks like you have been testing alot of different methodologies. You may have realized already that indicators are practically useless and relying on them too much will not force one to truly understand the art of trading.

I personally have worked with the ADX in the past but I found it better on a daily chart than an intraday 1,3,5 min charts. I use a 233 tick chart. I have not yet traded the Russell yet. Does it mimic the dow or the S&P?

[ezduzzit]

Yes, I am basically to this point a support and resistance trader, which of course is more than the morning's posting of the floor pivots. Pivot Magic is a little course put out by a fellow named Asher Landesman, who believe it or not is a CPA, one of the first I have ever come across who could trade, heh heh.. but of course the same could be said for bankers so I will be quiet about that now.

I do not as yet use market profile in my trading as I felt the tools to do so up to this time were quite weak. I think you were right in your primary assessment of this new site in that it ferrets out the footprint info to give you a true edge in running alongside the real market movers as opposed to getting slaughtered alongside the individual retail players.

As to indicators, I disagree with you slightly. They have GREAT predictive capacity. Yes, no doubt they are terribly lagging but just think of the millions of retail traders who trade with them! Much like Fibonacci, it causes reactions in the marketplace that you can "almost" rely upon a good percentage of the time as you know what their signals are going to be telling them to do, regardless of the real underlying current in the market which they cannot see and do not understand. That gives them predictive value to those traders who do understand how those indicators get played.

ADX/DMI is quite useful on 5 and 15 min charts with the right settings, but again is still a laggard. As indicators go, I feel it is one of only a very few semi-useful ones. However, without a little luck and excellent money management, the pros will still separate you from your trading capital over time. I feel you are spot on in your assertion that those relying on indicators may never really understand what moves the markets and how to flow with it. It forces them to become and remain "impulse" traders which over enough time is sure to lead them to financial ruin.

Nothing at all wrong with trading a 233 Tick chart that I can see, however, I am perhaps a little less fixated on tick versus time period bars as you seem to be.

As to the Russell, just pop it up alongside your normal chart(s) for a week or so and watch how it moves. I think you will find a fairly strong correlation in most of the e-minis but it takes screen time to find your favorite and of course things do change over time. Today has been an excellent and readily tradeable day on the e-mini Russell once again, but that is just my personal opinion.

After all my study, testing and live trading thus far I can only say the following: There are tons of would be "experts" out there in trading separating people from their money via marketing pure junk (read as more and more indicators and black box systems, methods, etc.). On the other hand the small percentage of actual pro traders (who closely protect their own methods) claim there are no secrets to trading. I think the truth falls somewhere in the middle. The holy grail of trading I think is centered in two keys: 1) The "discipline" to stick to a simple trading plan with a tremendous focus on money management and position sizing to protect your trading capital and 2) Centering your trading plan and rules upon info that shows what the big dogs are truly doing to move the market and riding those moves piggyback as well as you can.

Now I think it is time for me to stop posting and get back to a review of my day's trading before I risk providing even more laughable fodder for the real pros who visit your forum!

[luke24.5]

EZ, I demo'd the new Market Delta last week and am trying Topgun this week. Not been able to find any reliable pivot tools inTopgun, but I can figure those out pre-market and then adjust as the day goes on anyway. But I haven't been able to get it set up to see the volume profile like they show on their site. Also, I'm getting an error msg from esignal that says I didn't sign up for enough symbols when I try to use the B/S pressure. Will have to contact them in the AM.

What setup are you using to watch the Russell w/ TG? As for me, I still prefer MD footprint charts at MP S/R levels but I'd like to be able to watch market internals in real time adn TG may do that better.

[ant]

luke, if you have TradeStation, you might want to take a look at the Market Delta simulation tool I made available in the thread below. I use it with Market Profile as well.

http://www.traderslaboratory.com/for...footprint.html

[Soultrader]

I admit, I pushed it too far by saying indicators are useless. I know they can be used to trade successfully but Linda Raschke said it best,

"I've known hundreds of professional traders throughout my career. I don't want to disappoint you, but I know of only two who were able to make a steady living for themselves with a mechanical system.�

	Quote:	ezduzzit
	On the other hand the small percentage of actual pro traders (who closely protect their own methods) claim there are no secrets to trading. I think the truth falls somewhere in the middle. The holy grail of trading I think is centered in two keys: 1) The "discipline" to stick to a simple trading plan with a tremendous focus on money management and position sizing to protect your trading capital and 2) Centering your trading plan and rules upon info that shows what the big dogs are truly doing to move the market and riding those moves piggyback as well as you can.

I completely agree with this. There are no secrets to trading. A simple trading plan is enough to generate a steady income. The key to success is understanding your methodology 100%, believing in it, following your trading plan, and having discipline. But I think the tricky part is that although you will see professionals trading as if trading was easy... to get to that level of comfort took alot of hard work. Trading should be easy, but that is after you graduate from the hard part.

[ezduzzit]

Luke.. I have unfortunately been far too busy with out of town visitors lately to even keep up with posting here let alone take the free trial at TopGun. My initial reason for posting that site was to get the opinion of those more experienced than I (that opens it up to most! heh,heh).

I am a little surprised to hear that you could not find a pivot tool as the video on Forex at that site clearly shows one in use on their charts.

I suspect if you contact them, they can help you get that fixed and also tell you how to get the volume profile set up properly to reflect as it shows in their examples. I currently use E-Signal myself and since I only trade e-minis I suspect I too would have to add some additional data, such as NYSE, etc. but I shall have to call Scott Wilks over there when my visitors are gone in a week and find out what I need for all of it to work properly, and only then will I open up a free trial. If it is only a 7 daytrial then I don't want to waste any of it.

You may very well be correct about the new MarketDelta charts, etc. Frankly, since I don't feel I have enough knowledge yet to properly use market and volume profile for my actual trades, I gladly yield the commentary space on such issues to those traders like you who do.

Happy Trading :-)