Trading The Wyckoff Way

[tupapa 10]

Around a week, why??

[DbPhoenix 42]

If you're going to trade EOD and expect to make money at it, you're going to have to do more preparation. Buying this now, at the midpoint, will most likely achieve the same result as doing the same thing intraday: lots of small profits, lots of small losses, lots of breakevens, lots of commissions, ending up in very little for all the time involved.

 

If you don't want to focus on one instrument, avoid the opposite course of skipping from one thing to another according to what appears to look good but which is actually far past the best entry, i.e., the Greener Grass Syndrome. Otherwise, you will always be late and resigned to picking up crumbs.

 

The buypoint here was last September, though the test of S in June was an acceptable entry. Now you're in the middle, which is the least attractive entry. Similarly, the entry on gold was July 26 (I posted a heads-up the day before). On silver, August 20th. In order to succeed at EOD trading, one has to be ahead of the curve, not behind it.

 

Survey a variety of instruments and select those which meet your requirements for range, volatility, # of shares/contracts traded, or whatever. Then select ten to track. When one or more of them reaches a point where interest is likely to increase, you'll know ahead of time and will be in a position to take the best advantage of it. Otherwise, you're just playing catch-up and picking up bad habits.

 

Db

[DbPhoenix 42]

Speaking of silver, think about this the next time somebody claims that volume always precedes price:

 

 

 

[tupapa 10]

Ye I am aware of what you are saying and I need to focus on products that are "on the springboard" such as gold and silver a few weeks ago..

 

I wasn't able to go long silver on the 20th, instead I waited for the pullback and went long on the 31st, I know this is a late entry but at the same time I thought this trade has potential and don't wanna miss it, hopefully it won't mean I'll be the sucker left holding the bag..

 

I will keep looking until I find something on the springboard and post it here fore feedback... Would you say US equities such as the NQ and the ES are worth monitoring or is it also to late? We are approaching significant highs so would it be worth looking for a long term trade around here?

 

Thanks for the feedback, great as always

[tupapa 10]

Was trading the Bund today and we had big selling at the begging of the session that took us down to 141.30. Here, buyers came in aggressively and I noticed climactic volume and a successful re-test. After this price moved between 141.60 and 141.30, establishing a tentative trading range, however, price didn't visit 141.30 after the first rejection.

 

I noticed how buyers stepped in around 141.43 but I was hesitant towards taking the long because it is the midpoint of what I thought could become a range.

 

What are your thoughts on this DB, is it worth going long around 141.4 (on the second S) or would you wait and see if we breakout or test the extremes? (141.60 and 141.30)

[DbPhoenix 42]

What would Wyckoff do?

 

Db

[tupapa 10]

Well Wyckoff would've bought the Climax or the re-test after this, if not he would've taken the BO which is what I did.

 

I was hesitant about going long at 141.4 because, although we hadn't auctioned around 141.3 after 08:36, we could traveled down there in search for buyers. It is just as good I didn't take the long because after posting there were various large range bars, volatility expanded and volume was very erratic which could've taken me out.

 

My question was:

 

Do you consider this a range from 30 to 60, although we haven't traded 30s again, or do you consider the range 45 to 60? Or do you not consider this a range at all??

 

If I was to consider this a range from 30 to 60, I would pass the long obviously as I don't trade in the middle of it.

 

Just trying to interpret things here...

[DbPhoenix 42]

You say you were hesitant about entering but that you took the BO. What BO?

 

Db

[tupapa 10]

It is not shown on that chart. I didn't go long at the re-test of what, at the time, I considered the mid point of a tentative trading range.

 

Instead I waited until we reached 60s where I was ready to short or go long depending on price action. We tested and buyers were more aggressive so I went long, and exited at the climax.

 

So answering ur question, BO of the tentative range I visioned in my head..

[DbPhoenix 42]

Your desire to trade is interfering with your judgement. I won't suggest again that you -- and others -- stop trading until you understand what it is you're trying to do, but I won't intentionally enable the behavior, either.

 

" don't wanna miss it" is a red flag, but this isn't therapy. If you've gone through the Journal process and have created a detailed list of goals and objectives and a thoroughly-tested trading plan, I'd love to see it. If you haven't, anything I say will be nothing more than guru-speak, and there's plenty of that floating around as it is.

 

Db

[DbPhoenix 42]

FWIW, this is what you're trying to trade:

 

 

[DbPhoenix 42]

For those who are interested, the entries are here:

 

 

 

[40draws 10]

Today was my first day of trading since taking an early leave for the long holiday weekend. I tried to execute two trades, both longs, one on RAX and the other on TSCO. In each case, my broker's website rejected the orders, saying that I did not have sufficient day trade margin. I checked my share count and everything, and clearly the broker was in error, as neither trade on its own would have required any margin at all.

 

I called the broker, and the representative agreed. He assured me that it would be fixed quickly. I tried another trade later in the day using a limit order far enough from the market that it would not be executed. The same thing happened - order rejected for insufficient margin. Another call, another rep, and again, the rep agreed with me. They put me on the phone with the margin department. The margin clerk could see nothing wrong. Again, I received the customary assurances of the customer service rep that all would be well soon enough.

 

I'm used to this broker, the website is easy to navigate, the mobile app is a breeze, and the commissions are reasonable, my withdrawl requests are processed quickly and accurately. I am not in a hurry to take my trade elsewhere, but if this continues for more than a day or two more, I will seek another broker.

 

Any suggestions? I trade stocks only.

[DbPhoenix 42]

I used InteractiveBrokers. Never had any problems.

 

Db

[goodoboy 10]

I have a question: Can I just the trade the ES (intra-day) by strictly looking at the ES chart and not the SPX? I have only been watching ES price action only and my friend swears I should be looking at SPX as well.

Edited September 4, 2012 by goodoboy

[DbPhoenix 42]

Decide for yourself. Put up both. If the SPX is helpful, fine. If it isn't, don't bother with it.

 

Db

[goodoboy 10]

Decide for yourself. Put up both. If the SPX is helpful, fine. If it isn't, don't bother with it.

 

Db

 

Thanks Db, I haven't used it in 2 months along with the lower indicators and I seem to be understanding things better this way.

[Gringo 10]

I need some input regarding exit strategy when a potential climax is identified. I am only working on one set up for now. Writing is making me confront issue that I otherwise would have confronted mid flight.

 

I am assuming here that the trade has been initiated and a potential climax has been sighted. I need to plan what I am going to do next.

 

Exit: Potential Climax (higher than normal volume)

 

a) Complete exit?

b) Partial exit?

c) Wait for SL/DL break after pot.climax?

d) Draw a steeper SL/DL lines after pot. Climax and exit when the steeper SL/DL breaks? This one's confusing as sl/dl are created usually when LL or HH is made and may not always be the case as some sideways movement is I believe required before that can happen (feel free to blast away the logic here).

e) Exit completely if close to S/R but wait for SL/DL break otherwise?

f) Do nothing the SL/DL break will eventually dictate exit.

 

Writing things down doesn't allow much space to hide behind lame excuses. It is or it isn't.

 

Q: If one tests a set up in with a certain bar-interval is that set up good enough for a different interval? Would the same if-else logic for say hourly bars work for daily bars? From the multiple bar-intervals I tend to think it should be fine. I use s/r independent of bar intervals and the logic holds.

 

Perhaps what I am asking is that if I do testing on intra-day 1-minute or 5-minute interval and results are favourable, does that automatically lead me to conclude that daily trading would be fine as well? Or for that I would need to do a new set of testing on daily prices even though only the bar-interval has been changed?

 

Gringo

 

p.s I may have put a lot of questions in one post.

[DbPhoenix 42]

Well, first, it's good to see you beginning again.

 

Second, what have you learned over the past four years (understanding that you took a time out) that might help you answer these questions?

 

Third, with regard to the bar interval, it doesn't make any difference. If you post a chart without any indication of time or price, it would be difficult -- within reason -- to tell what bar interval is being used.

 

As to the setups in general, there's little to consider. There are two general contexts: ranges and trends. Within those contexts, there are three strategies: breakouts, reversals, and retracements. And that, essentially, is it. One must test all this (a) to find out if all of this is true, (b) to learn a new way of thinking and seeing, © to reconcile what the trader wants with what the market wants, to "zipper" the self and the market. Few can accomplish the last, which is why so many fail.

 

Db

[joshdance 10]

I have a question: Can I just the trade the ES (intra-day) by strictly looking at the ES chart and not the SPX? I have only been watching ES price action only and my friend swears I should be looking at SPX as well.

 

If your friend told you to jump off a cliff, would you? :rofl:

 

Just kidding. As SPX, ES, SPY, etc., are all arb'd and theoretically correlated 100%, you will see essentially the same thing from an intraday perspective. However, the cash closes at 4pm, and you may find things simpler to look at from a day-only perspective looking at spx without the overnight action as well.

 

From a longer-term perspective, there is quite a difference in the two due to contract rollover. For example, the 5/19/2008 ES high of 1373.50 on my back-adjusted contract corresponds to an actual high of 1440.24 on the cash index, a huge difference of about 5%! So, for referencing support/resistance levels that are more than one or two contract rollovers ago, I always reference the cash to see what's really up.

 

The bottom line though, is, do you find use in it? If so, use it and thank your friend, if not, then don't.

[tupapa 10]

Trading the DAX today, and this is my pre-market analysis:

 

On the Daily, the uptrend has paused for the time being and we are currently ranging between 7091.5 and 6889. Lets take a lot closer at the 60 min chart to find relevant S/R Levels:

 

Support is found at:

 

6919.5

6902

6872

 

Resistance:

 

6971

6992.5

7020

7050

 

Today I will be looking for reversals at either of these levels, looking at the other extreme of the range as a preliminary target, but I will let price decide where it wants to go and try to "flow with it" Be water my friend

[MightyMouse 12]

From a longer-term perspective, there is quite a difference in the two due to contract rollover. For example, the 5/19/2008 ES high of 1373.50 on my back-adjusted contract corresponds to an actual high of 1440.24 on the cash index, a huge difference of about 5%! So, for referencing support/resistance levels that are more than one or two contract rollovers ago, I always reference the cash to see what's really up.

 

A guy I know uses support and resistance levels from prior years on a continuous contract and has claimed that ES reverses "to the tick" at old S/R levels. Curiously, the level he is talking about never existed.

[DbPhoenix 42]

Before we stray too far from the subject, I should remind those interested that "support" and "resistance" are as fuzzy as truth and beauty. Many people define S&R in very peculiar ways. The definitions used in this Forum are specific and have very little application to, for example, four-year-old highs, unless perhaps one is trading something that's been in a trading range for four years.

 

I say this here because this thread has reached the point where nobody is going to read it, except possibly for the first post or two. Under those conditions, threads can get WAY off track, and the primary purpose of this thread is to keep it all simple.

 

Thank you.

 

Db

[Gringo 10]

Here is a bit of an update on the daily QQQ.

 

 

Gringo

[DbPhoenix 42]

I was looking at this stuff the other day. So far, the only leaders that are showing genuine weakness are QCOM and IBM. Everything else appears to be holding its own.

 

And, of course, volume is subdued. And it is September.

 

Db