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Market Wizard
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Everything posted by Predictor

  1. The real con to system trading is that if one studies the market then they can develop a "feel" for the market and can integrate multiple types of information, as well as learn rules to complex too fully code. This contrast with trading systems which are defined by rigid rules and rely on very specific and selective events, patterns, and conditions to profit from. Due to the infrequency of trades and lack of higher level abstraction inherent in most trading systems, it is much more difficult (though not impossible) for traders to get a "feel" for a trading system. This division between the trader and the system can cause internal conflict in the systems trader who has developed market expertise as the internal expertise may conflict with the systems information. There are various ways to solve this conflict. One approach is to ignore the internal conflict. This prevents any development of higher level abstraction and integration from taking place. Another approach that I've used is to vary the position size based on my own confidence. A similar approach requires opening a system trade but leaves the closing to discretion. As for pros, there are many pros. The first is having a stronger basis for a trade. The ability to compare the actual results to the hypothetical results also provides a yardstick for measuring performance. And, it is possible to come up with various expectations for maximize bet sizing with systems which is hard to do with discretionary trading. Furthermore, style drift is not as much of an issue. As you note, the possibility for the system to watch several markets is a huge benefit to systems traders for those with larger accounts. Currently, we are researching graybox systems which we expect will combine better with discretionary trading. The goal with our graybox approach is different from traditional systems. The goal with our graybox approach is to give the trader the best insight, clarity,and intelligence into the market versus to come up with the most profitable backtest. The change in approach from "find most profitable backtest" to "generate best intelligence" opens up expanded potential for exploration and unique potential for synthesis. --- Curtis Home - OrderFlowDashPro
  2. Below is the link with all the information about our free NinjaTrader sponsored webinar scheduled for this Friday 9/27/2013 at 4:15 PM EST. See you there! NinjaTrader Partner Spotlight Presents OrderFlowDashPro ---- Home - OrderFlowDashPro
  3. There are at least 2 basic approaches to trading, one is what I'll call opportunity based and the other is what we call process based (explained more on my blog). Opportunity structured traders will seek out exceptional opportunity at all times and even in multiple markets. Process based traders focus on following a specific process that enables them to read the market at a high level. Both styles can work but opportunity based trading requires a higher degree of discipline and would be better for a pair of traders then individual. The best time to trade is when your most profitable, of course. Most traders do well when volatility is higher then average and direction is more predictable. I divide the market up into Pre Market, Open, Morning, Evening, After Hours/Night. I've found good opportunity in the S&P 500 emini during most of those sessions/times if one know how to trade except for evening trades. The best opportunity for me is typically off the open and into the morning hours -- as well as after hours. If you trade late evening/evening then you will probably want to plan on holding some trades over the regular session close. Typically, systems that trade trends do better with longer holding periods. So, if you know the market is going to trend then buying as early as possible and holding until the close is going to be hard to beat. It is not at all required to trade all day to trade well. Many would do better just trading a few hours per day. --- Home - OrderFlowDashPro
  4. Mitsubishi, You may notice there is a thread about how traders don't post on these forums anymore because of trolling. As far as our platform, we have traders switching from platforms that are very expensive and switching to our platform from platforms that aren't expensive at all and each says something that is encouraging to me. But our platform won't appeal to everyone, I use a lot of trading platforms in my work. What we built is very specialized because the other platforms didn't meet the specific needs I had. I don't know why you think GS traders are so great. A successful trader must be better then the entire market which is a lot bigger and smarter then GS. Of course, its impossible to better then everyone at everything which is why I was sharing a concept when I made that post regarding something known as Selective Advantage. In fact, I'd wager that any day trader who's profitable is going to be better at what he does then most traders at big hedge funds. I seen another joker trying to compare day trading with a max daily loss limit to a hedge fund performance. They aren't even comparable because most of the hedge fund profits comes from huge diversification, market neutral trading, strategies that aren't available to retailers such as complex yield curve trades, and time value of money. To be clear, if you gave the average trader who makes 30% per year trading 100k and said okay you risk $500 max per day and day trade it then he wouldn't be profitable. They aren't even comparable because the trader who makes 30% year is typically making a lot of that through diversification, holding through drawdowns, etc. I don't see why you would think that a trader who trades complex yield curves would be great at predicting very short term moves in the S&P 500. If you want to talk just dollars then Warren Buffet is probably the best trader of all time. Does that make him better then a trader who makes millions at GS trading curves or building black boxes? No, each has a selective advantage.
  5. I've thought about that, and I can see how that strategy could work but seems like a high risk strategy where you don't have much of an edge. I think trading reports is better suited to options/spreads. You could buy an OTM spread or use NADEX binaries or options. I think buying an OTM option would be better way to play reports because your able to cap your risk. If the market doesn't move much, you can just close them out for small loss or break even. Goes without saying, its impossible to read tape during the runs caused by reports. But, sometimes you can wait until the tape turns and take the opposite side. What can work is to wait for the momentum to run out... read the tape and watch for it to turn to take the other side. Even that is a rather high risk trade because any mistake can cause a big loss. Buying a retracement after a report moves strong in one direction can work very well, if offered. --- Home - OrderFlowDashPro
  6. We've recently released AlphaReveal 2! AlphaReveal 2.0.1 offers dramatically improved performance, new & innovative QuantTape, and other features. While I knew we had the best order flow platform, what's been very encouraging to me is that we've traders who've tried all the order flow tools out there and still end up choosing our platform because they see the value. We do offer a free 2 week trial for anyone who wants to try it out and we don't charge customers who cancel before their trial expires. Additionally, NinjaTrader is sponsoring a webinar that we'll be hosting on Friday, September 27th at 4:15 PM. We'll demonstrate the platform, share thoughts on how we read the tape, and share more about our upcoming Quantitative Advantage program. We're very excited about this program because we're going to stream down our best signals which will give traders a proprietary advantage. We've had top ranked third-party tracked futures systems but our goals with this program are unique. Our goal isn't just to give you signals like you could get from a trading system but to provide signals that can be combined well with discretionary trading process. Most successful trading systems are built around very specific conditions, don't trade frequently, and again don't lend themselves to discretionary input. Our goal is thus to move toward more frequent co-incident "graybox" style signals that can give traders a real advantage but still require traders own insight. Our ultimate aim is to give traders proprietary advantage and create a positive team oriented/floor trading atmosphere designed to help bring out the best in each individual trader. Here's a clip just showing some of the capabilities of our platform.. Switch to HD for better viewing experience. --- Be sure to read our blog! http://www.orderflowdashpro.com/blog.aspx
  7. I'm interested in learning more about the type of equity index futures spreads available and if anyone trades them? I've started to get some interest in these products. What spreads are available? Who primarily trades these? What's the volume like? Are these suitable for day trading? Is it possible to build something similar to a bull spread or risk limited position with these products? What about fungibility? Feel free to share information on other types of spread products too. Forex spreads... synthetics... Been interested in this a while but haven't really did much in this area..
  8. I have never used tick charts and have always been dubious of them because a tick chart can make a very short amount of time look like there was time to take action. But, I don't trade off charts at any rate.. Still the common/most obvious charts have always looked best to me.. maybe because so many traders are watching those
  9. I'd keep in mind a possibility the 80 level could get taken out. I think that's very possible but probably not much lower.
  10. I've been busily adding new educational content over at our blog. I'm sharing a lot of the best insights into tape reading and order flow that I've learned over the years, and hopefully our blog will become an invaluable resource for traders interested in learning about the realities of tape reading. I haven't personally seen this level of detailed information shared on this topic. Right now its still a bit technical but we plan to back it up with "show me" examples in the future. You can see those posts at our blog: Blog - OrderFlowDashPro Thanks again! -Curtis Home - OrderFlowDashPro
  11. Just as an aside, I think the ES moves quite nicely. I think the key is to understand your market and how it moves. I don't trade CL but obviously those trading it will try to catch a larger run.. With the ES there is plenty to be made in little chops and also runs. I've never had a need to trade another market and I know many traders who trade equity indexes and won't go near something like CL. One of the nice things about the ES historically is that the market will chop around long enough for a trader to recognize they're wrong and get out without taking a stop loss. The market tends to be moving faster these days and trading more like actually the CL which is a downside for me. One thing to be aware of is that if one wants to use a tight stop then they'll do better trading a market that makes larger moves. The reason for this is that such methods need big winners to overcome lower win percentage. These traders lose a lot of money in "chop" zones as they constantly get stopped out for losses when they wouldn't have needed too if they used a larger stop. Likewise traders who look to trade chops/reversals can take large losses when volatility increases. Because a larger stop is basically a bet on a lower volatility environment.
  12. I've always focused on the futures to the exclusion of other markets. There is a lot going for them as discussed here. There are some downsides to futures though. The first is the large contract size which is too large for many traders. This large contract size also suffers from not being very "granular", ie if you wanted you can't just go long equivalent to 100k notional but have to choose 75k or 150K for ES. Some futures like CL are due to the size swing too risky for smaller traders. The large tick size makes tape reading more valuable but it also means it costs more to cross the spread. I wouldn't want to see that changed. Stop losses can be used to manage risk but have the effect of introducing an element of unpredictability. Unless one trades futures spreads (which most retail traders aren't aware of), its also hard to formulate relative value statements. For example, if one wanted to express sentiment that A outperforms B. There are exchange listed index spreads but they aren't discussed. Another problem with futures traders is they tend to be directional only traders. This again isn't required but unless one has multiple accounts then one can't be long/short same instrument (though the upcoming NinjaTrader webinar plans to speak to that). Alternatives: NADEX spreads -- One could use our tape reading program but trade the risk limited spreads. I'm watching the spreads with AlphaReveal in real-time today and they seem pretty tight. Another option would be to scalp in the futures and then hedge off using NADEX. I think this could work quite well for some of my "bigger" trades. Forex -- Again, the benefit smaller contract size. An option would be to read the tape off the 6E. I haven't tried this but its something I'd like to try. Weekly futures options & options -- bull/bear spreads could set up multi week trades without stop out risk Stocks: Ability to pair off anything with anything.
  13. Thanks for your positive feedback. We appreciate honest feedback from real customers. I've also added more articles over at our blog for those interested in learning about these concepts. My goal going forward is to continue to provide the highest quality instruction on these topics. Most of the new articles right now are only text. My goal is to add some illustrations, videos, and more blog posts going forward. Thanks again! Curtis -- Home - OrderFlowDashPro
  14. We could see 98.50 challenged today... will keep open mind
  15. Market is a bit harder to read the day.. unsure why.. maybe less liquidity..
  16. One HFT insider stated that the real advantage of HFT was in using special order types that front run institutions such as "hide not slide" which can be used to jump queue position during market locking conditions. It is not just the speed advantage in equities. The effect has been to force many professionals out of the business, particulary vertical proprietary firms that relied on speed advantage -- have shifted to HFT strategies. Blue, I imagine there are many types of HFT algorithms running in the futures market. A large class are of which are likely execution algorithms which blast in market orders at certain opportune times. Suspect a good portion of it is actually institutional trading. What the HFT traders do is blast in these market orders in front of resting limit orders.. My software allows me to see this activity on a regular basis. Just as an aside, if there are plenty of orders resting on the offer and you want to go long then there is no reason to submit a market order until/unless the depth drops. While its true that icebergs are present, the depth will always drop before the market moves. Another algorithm involves placing bids out and cancelling them to try to always stay an optimal distance off market based on market conditions. This is a very good indicator actually that I use for trading and that my software also presents clearly. I am not sure how they get around the cancellation ratios. They may even layer multipe orders within a level and then cancel them in such a way as to try to only get filled when the market doesn't trade through. Perhaps, these are liquidity providers who aren't subject to those rules(?) I imagine the major negatives to this activity is that it discourages institutions to leave as many orders out, faster V-spike movements, and the market doesn't respect support/resistance levels as well. So, there isn't as much time for traders to wonder about if a new high or low is good because these bots will slam them so fast. What this does is encourage others to also go to market instead of trying to get filled which slams the market down several ticks. --- Curtis Home - OrderFlowDashPro
  17. Thanks to everyone who attended the webinar! We're going to be adding a lot more educational materials on our website going forward. Also, I wanted to share this event which is coming up on Wednesday March 6th. I'm very interested in what Justin has to present and based on the bullet list I believe it will be extremely worthwhile. ---- OrderFlowDashPro will be hosting an exclusive event with Justin West of NinjaTrader on March 6rd at 3:00 PM Eastern! The Advanced Trading Techniques and Market Analytics with NinjaTrader 7 webinar is FREE to attend, and will cover the following: • Maximize profit potential by trading directly off your chart using automatic trailing stops and profit targets • Be ready on every FOMC day with a Breakout strategy to effectively trade news events • Learn how to go both long and short on the same instrument in the same account using NinjaTrader’s powerful Strategy Selection Mode. • Explore NinjaTrader’s extensive list of free indicators including custom made indicators available on the NinjaTrader Support Forum • Added Bonus! Learn to fine tune your trading strategies by recording the day's action and replay at your convenience, 24 hours a day, 7 days a week! Attend this event to learn how to incorporate these techniques for an immediate benefit to your trading! Register Now! -- Home - OrderFlowDashPro
  18. I imagine today would not be a good day to be a liquidity provider in the ES.
  19. Dude, Thanks for info my program also has simulated order queue position. But, I don't use it in that way. No, I think it was just bad luck earlier today. There were less then 200 cars left on a level and I wasn't able to get filled. Its probably an effect of tending to take my orders off at near pivot high and lows. I usually try not to do that actually so that I can ensure fills. There appears to be an HFT algorithm that will slam the offer/bid at certain times, i.e by shooting in market orders. I understand how it works but not quite willing to share it. One algorithm will shoot in orders in front of order book imbalances which shows up in my program quite nicely. I believe there is another algorithm working too which I'e identified which is causing my problems. Curtis Home - OrderFlowDashPro
  20. I've always been under impression that for CME markets like ES the orders are always processed in FIFO. However, I've seen cases where I can't get my fills even though it seems like I should. I've heard of pro-rata matching for market makers. Can designated market makers/liquidity providers put orders in front of queue? I know its probably just me. I haven't heard of any ability to do this but just wanting to make sure. I've seen what appears to be new aggressive HFT trading in ES that is making it more difficult for me to get fills. I suspect the algorithm they are using, already. Here are all CME order matching algorithms. This is FIFO. http://www.cmegroup.com/confluence/display/EPICSANDBOX/Match+Algorithm+-+FIFO
  21. Bias is long for scalp but looks like day could trade lowr
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