[clmacdougall]

Originally Posted by i trade »

Hey there my friend,

I have to say when I am running on all cylinders 99.9% of my trading plan consists of leaning on value of some degree or another.

Although you can say the concept of MP is a science I believe learning and mastering it is more of an art. Kinda like playing a musical instrument if you will. The concept itself is easy to understand but to be able to harness the power of it is another story. On the surface pressing some keys on a piano looks easy...but to produce beautiful sound from one I imagine would be quite the endeavor.

Horizontal rotation is caused by traders agreeing on value within a given zone or area. You can't expect traders to agree on 1 exact price for value for any period of time but they will agree on an area. It's a feeling out process to find efficiency or balance. Its all relative to the time frame you are trading. There is always going to be indecision and uncertainty at some level. The degree of indecision is what makes the market Cory. The key for me is comparing the balance/imbalance in the foreground to the balance/imbalance in the background. When I learned to do that I was able to embrace the uncertainty.

The question I'm always asking my self...how does the vertical movement/dominance in the FG (foreground) compare to the condition of the BG (background)?
The 2 outcomes to that question are what shape my trading plan:

1) the FG vertical movement/dominance gets absorbed by the balance in the BG (for me a winning situation/trade(s))

2) The FG vertical movement/dominance changes the condition of the BG (I stop out and evaluate the opportunity to reverse and start the process all over again)

Gotta run...I have some value areas waiting to be leaned on.

To be continued....

Playing a piano huh.....sounds like pages 3 - 5 in Mind Over Markets, a pretty quaint analogy but useless. Please, no mention of "Beethovens haunting Moonlight Sonata" (bottom of page 3).
Forget about what the book says Tommy, what do you think? Is the stuff right or off? Just because it was written and published doesn't mean you've got to quote it verbatim. Why not question it and make for a useful thread instead of quoting it and having us all go to sleep.
A "feeling out process" ......"indecision and uncertainty"......."embra cing the uncertainty"! That sounds like my first couple of years trading, not what I want to hear from someone who understands market structure.
If you got the goods than fill us in.

[MightyMouse]

Originally Posted by clmacdougall »

Playing a piano huh.....sounds like pages 3 - 5 in Mind Over Markets, a pretty quaint analogy but useless. Please, no mention of "Beethovens haunting Moonlight Sonata" (bottom of page 3).
Forget about what the book says Tommy, what do you think? Is the stuff right or off? Just because it was written and published doesn't mean you've got to quote it verbatim. Why not question it and make for a useful thread instead of quoting it and having us all go to sleep.
A "feeling out process" ......"indecision and uncertainty"......."embra cing the uncertainty"! That sounds like my first couple of years trading, not what I want to hear from someone who understands market structure.
If you got the goods than fill us in.

Mac,

I am assuming you are new to this.

If your goal is to make money trading, your time will be best spent getting your head in the right place when you're in a live trade rather than slaving over trying to find the perfect indicator or method of trading. MP is as good as any other method of looking at the market. It will give you a disadvantage if you use it and don't trust it. So, if you don't trust it, stay away from it.

[i trade]

Originally Posted by clmacdougall »

Playing a piano huh.....sounds like pages 3 - 5 in Mind Over Markets, a pretty quaint analogy but useless. Please, no mention of "Beethovens haunting Moonlight Sonata" (bottom of page 3).
Forget about what the book says Tommy, what do you think? Is the stuff right or off? Just because it was written and published doesn't mean you've got to quote it verbatim. Why not question it and make for a useful thread instead of quoting it and having us all go to sleep.
A "feeling out process" ......"indecision and uncertainty"......."embra cing the uncertainty"! That sounds like my first couple of years trading, not what I want to hear from someone who understands market structure.
If you got the goods than fill us in.

Mouse hit the nail on the head. If you don't trust your methodology it ain't gonna work... plain and simple.

Cory, if you say I sound like Dalton I'll take that as a compliment...ty my friend!
What exactly are you looking for? MP is not a system that tells you when to trade based on a red line crossing a blue line. MP is a way to organize the data that is produced by market action. I use it, in all time frames, to show me areas where I want to do business.

Every trade is all about uncertainty man...unless you have a crystal ball you're not telling us about. The idea is to get to a point in your trading where you are comfortable with the uncertainty of the situation because you know your risk is clearly defined and you have probability on your side.

Maybe this forum isn't the right place. I'm not trying to talk anyone into using MP. It works for me. My thought here was to try and hook up with other like minded MP traders to bounce ideas off while sharing my strengths and improving on my weaknesses.

[BlowFish]

Originally Posted by MightyMouse »

Well, there aren't any tools that offer long term statistical significance other than trading with inside information......

You might want to look at Jperls excellent threads on trading with market statistics. At a couple of points there are fairly interesting discussions on what is 'statistically significant' and what is not (particularly comparing MP with the market statistics framework). Apart from that it is a novel approach with as complete and robust a presentation that you are likely to find anywhere.

There are a variety of things that are 'statistically significant' (Jerry discusses a few) whether they can be used to provide an 'edge' (my experience is that Jerrys stuff can) is a different matter of course

[clmacdougall]

Look at the title of this thread, " The Evolution of Market Profile Theory,". The idea in coming to this thread was to stretch ourselves while discovering a new and vibrant way to apply MP theory.
The only reason I followed this thread was because UB was doing just that. I'm not trying to offend you, just to continue the spirit of this thread forward.
We can certainly question the methods by which we trade MP and at the same time why not knock around the theory a bit too. It's not sacred!
The theory is simply a non-traditional means of ascertaining support and resistance, the only difference between this and traditional understandings of identifying support and resistance is that instead of looking for a pullback from those areas to the nearest areas of previous congestion, we look for a pullback towards the POC / HVP .
Is that a viable means of long term success in trading?
Does looking at multiple time frames of previous bell curves and POC's / HVP's in higher timeframes really help us to understand where price "might" go?Or is that part of the "pseudo-science" that has been attached to MP?
I don't know if I ever once heard UB referring to the "Value Area" maybe he understood how elusive value really was and focused solely on price rejection instead. Does price really have the potential to return to a "Value Area" / POC when it gets rejected or do we simply look for opposing rejection before closing out our initial position?

[MightyMouse]

Originally Posted by BlowFish »

You might want to look at Jperls excellent threads on trading with market statistics. At a couple of points there are fairly interesting discussions on what is 'statistically significant' and what is not (particularly comparing MP with the market statistics framework). Apart from that it is a novel approach with as complete and robust a presentation that you are likely to find anywhere.

There are a variety of things that are 'statistically significant' (Jerry discusses a few) whether they can be used to provide an 'edge' (my experience is that Jerrys stuff can) is a different matter of course

Blowfish,

What i mean by statistically significant is probably something different than what this jerry individual considers statistically significant.

if you roll the dice, before you roll, there are exactly 36 possible outcomes. So if you are trying to roll dice for money, there is only 1 of 36 numbers you can roll. It's never the case that you think it's 36 but it's really 37, 40 or 400 or 5. So, in dice, you are able to use statistics to determine whether or not the payoff for winning is enough to overcome the odds you have take. Clearly, a casino makes sure that the payoff is in their favor.

In trading, it is never the case that there are a fixed set of outcomes in the future. In the market statistics is a good way to measure the past, but that's about it.

[BlowFish]

Originally Posted by MightyMouse »

Blowfish,

What i mean by statistically significant is probably something different than what this jerry individual considers statistically significant.

if you roll the dice, before you roll, there are exactly 36 possible outcomes. So if you are trying to roll dice for money, there is only 1 of 36 numbers you can roll. It's never the case that you think it's 36 but it's really 37, 40 or 400 or 5. So, in dice, you are able to use statistics to determine whether or not the payoff for winning is enough to overcome the odds you have take. Clearly, a casino makes sure that the payoff is in their favor.

In trading, it is never the case that there are a fixed set of outcomes in the future. In the market statistics is a good way to measure the past, but that's about it.

To be honest it's probablly not worth pursuing this. It has all been said before in the threads I mentioned. Sampling market data is completely different to sampling die rolls, thats the whole point. Seems like a counter productive use of my time to repeat all the arguments again here.

All I can tell you is that the threads I mentioned present ideas that demonstrated to my satisfaction that not only can statistics be used to analyse financial time series but they present robust ideas for trade entry and money management based on these statistics. At the time not only did I check out the maths (who would have thought stats would spark interest!) but I traded the ideas for successfully for several months before going back to my own thing.

I can not understand why anyone that is interested in the 'evolution of MP' would not want to take a look. It has a lot of smilarities to MP including a similar 'look and feel'. You could argue it represents the current state of the art when it comes to the 'evolutioun of MP theory' (except based on valid statistical methods rather than heuristics). I guess you can lead a horse to water but you can not make him drink.

[i trade]

Originally Posted by clmacdougall »

Look at the title of this thread, " The Evolution of Market Profile Theory,". The idea in coming to this thread was to stretch ourselves while discovering a new and vibrant way to apply MP theory.
The only reason I followed this thread was because UB was doing just that. I'm not trying to offend you, just to continue the spirit of this thread forward.
We can certainly question the methods by which we trade MP and at the same time why not knock around the theory a bit too. It's not sacred!
The theory is simply a non-traditional means of ascertaining support and resistance, the only difference between this and traditional understandings of identifying support and resistance is that instead of looking for a pullback from those areas to the nearest areas of previous congestion, we look for a pullback towards the POC / HVP .
Is that a viable means of long term success in trading?
Does looking at multiple time frames of previous bell curves and POC's / HVP's in higher timeframes really help us to understand where price "might" go?Or is that part of the "pseudo-science" that has been attached to MP?
I don't know if I ever once heard UB referring to the "Value Area" maybe he understood how elusive value really was and focused solely on price rejection instead. Does price really have the potential to return to a "Value Area" / POC when it gets rejected or do we simply look for opposing rejection before closing out our initial position?

Cory,

Correct me if I'm wrong but it seems like you are focused on using MP to tell you where the market will go. I gave up a long time ago on trying to figure out where the market will go. Instead I use the profile to tell me where the market shouldn't go. Here's another silly analogy for you...I look at price as a pinball. I don't know where it will end up but I know with good probability where it should bounce. And those areas where it should bounce are the areas where I want to do business. I look for the background condition of the market to absorb the vertical dominant movement. Unless the condition of the background changes due to dominant vertical movement, the trade produces profit for me. I haven't discussed MP concepts with many people but it seems like most people on these boards use MP to project where price will go: how the profile structure might fill out, TPO counts, day types, range projection,etc. None of that stuff has ever worked for me and only served to confuse me while taking away my confidence.

Now the art of correctly managing those trades is the part of my personal trading that I am refining and the part that can use some improvement. All in / all out type of trading never worked for me. A big improvement to my trading came when I realized the correct way for me to enter and exit trades is to scale in and out. So unless the vertical movement that I am fading blows right thru my area I am always locking in at least some profit while building a cushion for any runners that I hold onto.

I am in a short trade in eur/jpy as I'm writing this...I'll post some charts later on it and try to explain my thinking on why I entered and how I managed it....still in it.

MP is not the only way I manage my trades but rather is the base for all my trading decisions.