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Market Wizard
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Everything posted by steve46

  1. Hello Jerry


    A quick question; For your purposes, is a volume profile POC (VPOC) a close approximation or possible substitute for the PVP?


  2. Not a bad question....do you wonder why no one offer to answer? First the technical answer....cash indices (like the SPX) are composed of stocks....the technical reason the SPX goes up or down is straightforward....during the trading day the current price of the SPX is the "weighted" (SPX is "market value" weighted) sum of the last prices of the individual stocks. What you really want to know (I think) is what makes those stocks (the "market") move and there the answer is less straightforward.....it depends on the day....for example...ask yourself what made the market move on Friday.....earnings (nope)....economic reports (nope)....concerns over Russia declaring that it would defend Syria if the US or NATO decides to attack (bingo!!!) Of course later in the day....after the dust has settled, look what happens, as "participants" say to themselves "oh...maybe the world isn't coming to an end, and I notice the stock I used to own is now cheaper....I'll buy it back at a discount" So my answer to your question (to the real question you ask) is on a given day, if you want to know where the market is likely to go....you have to look at the big picture and ask yourself what factor or factors are likely to be pivotal or to have the most significant impact on participants...will it be news, economic reports, or earnings or some other factor....if you can figure that out prior to the open....you have a "real" edge over those who simply show up and watch moving averages wiggle....lol
  3. Have to agree with Midnight....I do know something of Joe Ross and his method....the trades look right and of course its not his aim to teach others. The fact that some folks find it objectionable is, unfortunately a fact of life here at TL...the idea that Handle's posts should help others is irrelevant....the gentleman was trying to construct a record of his trades that HE could make use of....and if in the process others saw benefit, well then all the better.. As with many threads here at TL, the primary opportunity is to see that A.) Success is possible, that B) Information about Joe's method is publicly available and C) one can then take the time to exercise reasonable due diligence. I understand Patuca's problem....he was kicked in the head by a horse and has never recovered....as for Bob.....apparently his strategy is more advanced...first he insinuates that the posts don't reflect Joe's teaching....when that doesn't work, "the posts are immoral"....and finally immoral or not, all is forgiven if only Handle will share his system.....and the "carrot" ....Bob's magic gold trading system....one is reminded of seeing a small child having a tantrum in front of a toy rack......I for one will smile and move on....so I'm sure will most other folks....
  4. Well....I am guessing that YOU will know more about the setups and about Joe's concept than most members here....my own experience is limited however one of the things that appeals to me about this system is that it relies on the time tested behavior of traders....The "Hook" as I recall was developed by Joe after he read a comment by a trader named Kneafsy...Joe decided to do the same thing and his "Ross Hook" is essentially a pattern that makes use of his philosophy that markets are moved by professional interests, and having moved those markets, at intervals they will want to take profits....the correction that occurs as they do this is the "hook". Personally I like the idea of trading based on human behavior.
  5. ZDO This I think is one of your best posts.....especially the last paragraph What I observe about handle (more than just the trades he posts) is his approach to the "Profession" of trading....it seems to me that at some point, he made the decision to obtain the best tools he could find....in addition (to what you have pointed out) clearly he is taking personal responsibility for following the system....this is what you have to do, if you want to reach your goals....Clearly the result is excellent...now the only questions are....will the system hold up and can the operator continue to execute in a disciplined manner.... I hope struggling traders find it inspiring...
  6. Using the phrase "failed traders" doesn't make it so.....I know of several traders who write books and they all make money trading....Linda Raschke, Larry Williams, Larry Connors just off the top of my head....I have books from all three in my library.....I read the books....I saw some concepts that might work for me.....I tested them.....I used some, and discarded the rest......if instead I had simply "gone live" risking capital without verifying the data....whose fault would that have been? The choices are straightforward....do your own thinking and be responsible for yourself or bring your mother to the bookstore with you.....
  7. As with so many things that people type into this website, there is truth to what you say, but it doesn't help the trader to move toward a productive goal (assumed to be making money). Reading this post one gets the impression that people lack the ability to think independently about the world around them.....If that's the case, those folks aren't going to do well in this business.... As regards "failed" traders....I have no data to confirm that traders who write books are "failed" traders.....with regard to courses I always execute a due diligence process, so the responsibility for outcomes is on ME...this is how adults do it...and until someone else types in a better alternative that's what I suggest other adults do for themselves...if you think about it this business is about being paid to accept and manage risk. I think the sooner a person "gets that" the sooner they go out and get the tools they need to obtain success. Finally, I notice that even when a person is "given" a valid system, quite often they cannot execute in a disciplined way....to me it doesn't matter why, its just a fact of life...some folks aren't cut out to trade successfully....Again it seems to come down to adult behavior....if you give it your best shot and it doesn't work out, then you move on to your next choice....eyes fully open all the time... Good luck
  8. If you read the above and think about it, the alternatives are relatively straightforward. There are two (2).....one is that you look for a resource like Rande, who understands what the obstacles are....the other is that you try the "do-it-yourself" route using your own money....either way the risks are about the same (assuming you trade a system that has a true mathematical edge)..... The more I read of Rande's approach, the more I respect his experience....the remaining problem I have with his (Jungian) orientation is related to the attachment of symbolism to what we now understand to be a physiological process.....from my point of view, attaching a symbol to a physiological process puts the trader at arms length from the real problem....I haven't decided yet whether that is a good thing (a "buffer" of sorts) or just one more obstacle to overcome...I also know that there are institutions that use simple "stress training" (military and police for example) to help their trainees to overcome issues related to arousal....it works pretty well For my students I suggest they either A) go live with small size (2-3 contracts) or sim trade with at least 3 contracts. Either way I am able to observe how they act (and react) to conditions prior to, during and after each sequence. Because some folks seem to have a capacity to "handle" stress....not all folks need that help....as Clint Eastwood said in one of his movies...."a man's gotta know his limitations".....(or maybe it was "make my day punk")
  9. We react to events around us, and in the process of reacting, we interpret each event and give it significance....within that (very short) time period we produce a cascade of chemical compounds that act on various parts of our brain.....and it is that chemistry that produces the "feelings" that we act on......this "chemical cascade" happens whether or not the event is positive or negative.....either way we are subject to a multi-stage process called "arousal". In the course of my own classes, I watch carefully as students transition from sim to real trading and after a while you can see it, in their responses, in the "response time" and in the verbal communications from each student as the trade progresses from entry to the fill, to the first partial profit, and ultimately to the final exit at the profit target or when they are stopped out.... The bottom line for me, is that what I see....is a multi-stage process that has to be mastered before a person can consistently do this work....you have to A) have, or learn to create a system that has a mathematical edge.....B) You have to learn to manage your initial emotional response (arousal) long enough to recognize your system's profit opportunities and C) You need to understand how the nervous system reacts to stimulus and learn to manage that arousal process so that you can manage the trade efficiently and bring home a profit...and just as importantly you need to learn to manage your responses to the inevitable losses that are part of this profession. For folks who understand this, you then start to see why so many fail....because in addition to the obvious challenges, there are hidden physiological issues that we all have to learn to deal with.... Good luck Steve
  10. Thanx Handle Its good of you to disclose your (ballpark) budget for education...I am often asked about this....and I tell folks that paying for a skilled trader's time is expensive, but worth it IF you can find the right person...yes there's always the risk, but that's the nature of this business....no risk...no reward.
  11. One of the problems human beings face is overcoming the natural impulse to move away from discomfort (pain) be it physical or emotional.....our physical systems are setup to respond automatically (as when a person touches a hot stove)....by withdrawing from that stimulus... In the trading environment, it is especially true of new or struggling traders....that they will take a loss, and then spend a significant amount of time thinking about that loss, and while they are doing so, miss the next perfectly valid opportunity to obtain favorable entry. One of the things that I try to teach students is how to manage, structure, and direct their attention 1.) prior to, 2.) during and 3.) right after.....each & every trade.....inevitably students balk at this type of training, insisting that it isn't needed....and what I do to show them just how important it is....is simply to model that kind of structured successful behavior The reason I mention it at all is that I NEVER read posts where people talk about this, and yet it is a behavior that is natural to us but is self destructive in the trading environment....hopefully this is something that Rande provides his clients...if so all the more reason to take a closer look. Best Regards Steve
  12. Dealing with the previous comment. A couple of things to think about First, while it IS true that one can find S/R and put on a position (scaling in) as it retraces...YOU MAY WANT TO CONSIDER....that this is how a legitimate reversal looks to traders on the other side...and those traders may have something YOU don't have (more size going the other way)..... What matters is time frame and context....always.....once you understand that big players operate on specific time frames, THEN you can put yourself in the right place....and the previous comments about volume, about retracements and scaling in and out, have real value. There is a key....its understanding the broad market in terms of time frame and in the context of significant events (economic reports, earnings, etc)...when you put the two elements together you eventually (if you are a good observer) see how the institutions and commercial players make decisions to put capital to work....then you start to see accumulation and distribution and finally the picture becomes clearer.. and for those who think just asking me "what is the proper time frame" will fix their problems its not that simple....its not just time and its not just context.....its the integration of the two that matters....become a good student and a good observer of the markets and you might get where you want to go... Good luck
  13. Hi, nice of you to post your log....what would also help struggling traders is if you would provide an approximate budget...so that they can have a realistic idea of what an effective education costs.... Thanks, Steve
  14. This to me is one of several critical issues relating to trading as a profession....I say this because inevitably there are those who approach me (and others) hoping to "buy their way in" to what they see as significant profits, if only they can find a system that works.....and in a pre-class interview I ask them....."do you have enough capital, that if you lost it (all) it would NOT change your lifestyle?" and "do you understand that a significant component of this class is about risk management as a way to consistently make money in financial markets"....in other words, its less about "setups" and more about learning to recognize, manage and fully exploit certain types of risk...this is (in my opinion) what professional behavior is really about and its how you learn to make a living as a retail trader. As it turns out most folks don't "get" that connection between risk management and overall profitability....not only do they NOT get the connection but they often assume that they can act like professionals who are NOT ONLY PAID TO TAKE EXCESSIVE RISK, BUT PENALIZED IF THEY DON'T (TAKE THOSE RISKS).....this is why we often read of folks called "rogue" traders...and people like John Corzine who took massive risk and lost......its a culture that is at odds with what a retail trader can do....
  15. I don't remember all the details, but what is discouraging about this is the following Skilled, educated, intelligent people should know that martingale betting strategies don't work.....all one has to do is simple research and you will learn that this is already proven....eventually and inevitably the participant's luck runs out and the market goes against them just long enough to bankrupt them....or to make them say "enough" and take a huge loss.....unfortunately on the retail side this is a viable strategy, because the average Joe usually doesn't have the knowledge or the ability to see it, or as I suspect in this case, Mr. Hoffman never let people see as he switched from one time frame to the next.....all they knew was that he didn't seem to worry when a trade went against him.... The bottom line is that the strategy he was employing wouldn't work for the majority of retail traders who have very limited accounts.....As I recall you had to buy his study course DVDs and only then were you allowed the privilege of joining his room at an additional cost of $250/mo)...
  16. This is a quote from the previous post "There was for some time a guy in Carters and Huberts team, who made winners most of the time (averaging down...etc) for nearly a year ! But than lost all this profit in one day (break-even for the year)!!! However the money his students paid for this year he kept !" The gentleman's name was if I remember correctly, Robert Hoffman, and his website was called "Power Charts"......apologies if I have identified him inaccurately.... So this was a person who had a "room" and claimed to have over 300 paying customers who presumably followed his activities trading the markets.....again if I remember correctly he also claimed to have NEVER had a losing trade over a period of three (3) years........ The problem was that Mr. Hoffman was using a variation of the technique called "martingale"...and in this version, (again as I recall) when he would have a drawdown on a trade, he would switch to the next higher time frame and continue the trade....(I'm sure this is an oversimplification) and in some instances this seems to have worked out.....however one day....he got into a trade that DIDN'T....."work out" to his advantage....in fact it kept on going against him, so much so that ultimately he lost a LOT OF MONEY....I don't remember exactly how much but I think it was hundreds of thousands of dollars.....and yes shortly thereafter, I remember hearing of a seminar on how to handle the stress of losing money.....lol For those interested, by all means do your own research because I am sure some of the details are incorrect.... Best Regards Steve
  17. Alright then....first, the concept (gamma scalp) is not complex and it is a good subject to explore....as long as the explanation is offered in a simple down to earth fashion....Siuya is doing a good job of that (in my humble opinion)....and ticks....the idea he offers is fine, the problem I may have with some of this is that there are a few "issues" that a trader needs to understand in order to participate.....I like to see a balance struck if possible... As for using a vol surface...that's my mistake....its going to be too complex a tool for folks to use in this context....my apologies....for anyone interested in researching that subject further, here is citation that can serve as a starting point..... http://www.columbia.edu/~mh2078/BlackScholesCtsTime.pdf I am glad to stand aside and read the rest of the thread as it develops Best of luck to all Steve
  18. "On average you will need to capture more than the $1 a day. (Due to the slope/rate of decay changing this will be likely only $.3 a day early on, and $3 a day later on -- More detailed Greek analysis is required - beyond any scope here and individuals can read this themselves) However the point being..... every day the underlying might move up and down around the strike but still close there every day at the strike. Historical volatility might be zero Actual captured volatility might be $.50 Implied - irrelevant as you have already purchased, unless you wish to then sell out the options again, and then this becomes a trading spread cost and you have in fact traded volatility as opposed to trading gamma." Couple of things here....first you folks were doing such a good job of describing this up to this point.....then......boom First, "decay" happens at an irregular rate.....in fact the relationship of decay to price is NOT linear....instead of looking at a simple chart like Ticks shows....try looking at a vol surface....what you will see is called "bucketing".....suddenly you are up or down significantly more than you expected.... Second...what you accomplish during the trading day is your realized profit for that day...in the overnight market, a news event can cause problems as your target market gaps up or down...causing your delta's to change (without you having the ability to hedge).....NOW what....do you exit....if you unwind that position, then the implied vol IS important....you mention "black swan" events....this is the reality of that phenomena Now one might think from this comment that I am a "naysayer"....I don't see it that way....for example, I remember very clearly holding 200 doubleclick puts and having my clerk tell me that there was "nothing done" when I tried to unwind.....(for the newbies that means "no one willing to buy").......what I am suggesting is that the authors take the time to describe the downside risks a bit more accurately... Thanks Steve
  19. We're going to take a couple of days off from posting.....Good luck in the markets folks Steve
  20. Once again the open was obvious. The current market seems to have a set pattern and once you have identified it, you have a significant advantage. Today we will attach our full screen showing all the trades, AND we will show the open (2 additional charts)......for this open we show the entry and the initial profit target. On days like today, when we have a high impact report scheduled for 7am PST, we ALWAYS go through the same process....and that involves pre-planning our entry (by "preferred time") and then holding to a specific timed exit.....
  21. As usual we advise students not to trade the last hour on a Friday....the reason being that the price action is somewhat distorted by automated execution... As can be seen we were lucky to have a clear signal to enter at the low of the day....if doesn't happen often but when it does it is considered a gift...we always assume that possibility of a gap fill, and today that did happen although it was quite a struggle at the end.... Best of luck folks
  22. Another boring slow low vol summer day...... We missed the open....simply put we weren't willing to be aggressive on this opening trade.... Fortunately we were able to get back on the right side later on....for the second long entry we exited at the lunch hour.....(students are asked to take a break at that time).....ordinarily this is a slow time of the day, and the market moves sideways....today lol..."continuation".... The longer time frame chart is very helpful to new and struggling traders who often rely on visual representation to make decisions...Adding Standard Deviation lines helps as does the 200 period moving average which serves pretty reliably as an ultimate profit target...
  23. Well that was interesting....my email seems to have gone through just fine...I should have captured the message that I got before....it said something about not allowing a certain kind of symbol...oh well thanks for the reply...hope all is well with you..


    Best Regards


  24. Today's session was interrupted....attached we show the opening trade (a winner) The second trade (not shown) was a loser ($30/contract) That's it for this session.
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