Day Trading the E-mini Futures

[roztom 10]

What I find difficult with the type of trading that MP/VP inspires is the amount of movement it attempts to statistically predict. There is too much that could and does go wrong with a trade like todays.

In effect roztom made an incredible call of a market turn today and watched his trade disintegrate late in the day. The truth is what we saw today was due to expectations that were too large, no statistical set has enough predictive ability to outlast the market.

You did a great job today Tom! Just lower the length of your call and I'm sure your statistical base will eventually catch up to your expectations.

 

Cory

 

Thanks Cory.. I know this is semantic but I do not have any skill to predict the market or make any market calls. There is no statistical predictive ability - at least I don't have it. I am a descretionary trader. I tossed the statisical aspect of MP a long time ago. I wanted to "read" the market.. it helps me do that. The targets and areas of interest stand... what the market does is up to the participants... I only use the tool to identify areas of interest. I also know that there is a high probability the market will test those nodes... What I believe that nobody knows is when...

 

My upside targets still stand - I don't know if we will hit them overnight, tomorrow or never.. I also scale out of my position along the way since I just don't know... I have always said - I know I don't know... that being said the market seems to go back and test Highs/Lows, etc Volume areas... Auction theory...

 

The profiles - Cumulative especially certianly have helped me see the potential of where the market might go and what to look for when we get there..

 

Targets are nice..I have to have a rationale and a target when I trade since my cost is too high to scalp.. I am forced into a longer timeframe to play the rotations.. so the profile and the nodes helps me see where my potential is..that is what those numbers are all about.

 

Since I have been posting this month a lot of the targets, etc have worked very well.. The other day several hours before an IB trade set up I posted the area, Not all IB's are the same.. there needs to be a LVN there and a balance above the IB - it ticked there and then took off to hit the target. What was different between today and then..? The setups/area of interest were the same - the level of participants weren't.. No way to know in advance.. BTW if someone does know if a trade will work in advance - PLEASE post...

 

I'm glad the posts help... I also hope that nobody misunderstands the purpose. I'm just another guy squeezing the blood out of the turnip..I also believe that MP is possibly one of the most misunderstood tools available to the retail trader. I believe there is so much distraction in the theorhetical/technical aspects that it's true value is easily obscured. MP/VP can be very helpful if integrated into the toolbox.. and the Academic aspect is jetisioned for the practical application.. Just my 2 cts... Again appreciate your kind words..

 

Regards,

 

Tom

[TheNegotiator 13]

I hope everyone realises though that trading from "node to node" isn't necessarily the name of the game. High and low volume prices are areas of previous value or supply or demand. Just because they were in the past, it doesn't mean they will be in the future. They do give us a framework to work with though. When we see prices revisited within the context of the auction, we watch to see if there is any indication that they will again hold up as places other traders are interested in. Sometimes we are more agressive if we feel the risk:reward is particularly favourable and other times we look a little more before committing. Then, when we are in a trade we watch for what the market does in comparison to our theory and we manage the trade.

 

As you can see, there is much more to the trade than high and low volume prices. Indeed, many say actually entry technique is not especially high up on the list of factors effecting a trader's success.

[roztom 10]

I hope everyone realises though that trading from "node to node" isn't necessarily the name of the game. High and low volume prices are areas of previous value or supply or demand. Just because they were in the past, it doesn't mean they will be in the future. They do give us a framework to work with though. When we see prices revisited within the context of the auction, we watch to see if there is any indication that they will again hold up as places other traders are interested in. Sometimes we are more agressive if we feel the risk:reward is particularly favourable and other times we look a little more before committing. Then, when we are in a trade we watch for what the market does in comparison to our theory and we manage the trade.

 

As you can see, there is much more to the trade than high and low volume prices. Indeed, many say actually entry technique is not especially high up on the list of factors effecting a trader's success.

 

Well put... I find if I am going to enter a trade I want it to be at a make or break area... A key level... I know if I am going to be wrong - I am usually way wrong..If I am right in my entry my risk is small and I have great trade location... even todays IBH trade did not have a large risk on it.. in my trade plan it was the right place to go long and add to my position.. (for me).

 

I think the management of open trades is tougher than entries also... What the heck do you do once you have the tiger by the tail?

 

A good entry is imnportant.. good enties allow you to manage your risk efficiently but then what? How/When do you scale? What about a target... other than Nodes what other targets are there, etc... I shoot for other targets - stops...on the other side...

 

We have been focused on entry/targets built on MP/VP.. I hope we can get into trade management and exits...

 

Regards,

 

Tom

[steve46 12]

Here we go, a much more interesting Globex open and early trade.

 

First, we have a continuation move off the RTH close.....the important thing about this short trend move is that it "takes out" the VAL at 1320.75.....seeing this.....if you understand how this market moves, you wait for the retest.....and sure enough (see the first green arrow on the left) price comes back to test, staying there for about a half hour (remember this is the Globex market)....before taking off to the north...

 

At this point (the red arrow) price runs out of gas at the lower boundary of our overhead supply node.....the "read" is very important....first you see the initial test at the boundary...then you see price test through trying to find buyers....but no interest.....this is the important part of any test of a level.....price tests, pushes through and fails....after a short retrace we get a "spike" up to match the previous high....once that spike comes back to close the candle....you have a nice low risk short entry....and as is characteristic of that failure, we then have a nice leisurely ride back down to retest value.....

 

The retest comes back to value but does not come back to the tick (as it did before). Instead we get buyers coming back into the market just a bit sooner (see the next green arrow) and what you see is a more "typical" reversal pattern.....this one follows an algorithmic pattern that I have seen many times....and it produces a low risk long entry....

 

This market is all about "reading" and making sense of the data....if you have the skills its a walk in the park...if not....you probably have a sense of frustration....

 

Wishing everyone the best of luck

Steve

[CYP 10]

Here we go, a much more interesting Globex open and early trade.

 

First, we have a continuation move off the RTH close.....the important thing about this short trend move is that it "takes out" the VAL at 1320.75.....seeing this.....if you understand how this market moves, you wait for the retest.....and sure enough (see the first green arrow on the left) price comes back to test, staying there for about a half hour (remember this is the Globex market)....before taking off to the north...

 

At this point (the red arrow) price runs out of gas at the lower boundary of our overhead supply node.....the "read" is very important....first you see the initial test at the boundary...then you see price test through trying to find buyers....but no interest.....this is the important part of any test of a level.....price tests, pushes through and fails....after a short retrace we get a "spike" up to match the previous high....once that spike comes back to close the candle....you have a nice low risk short entry....and as is characteristic of that failure, we then have a nice leisurely ride back down to retest value.....

 

The retest comes back to value but does not come back to the tick (as it did before). Instead we get buyers coming back into the market just a bit sooner (see the next green arrow) and what you see is a more "typical" reversal pattern.....this one follows an algorithmic pattern that I have seen many times....and it produces a low risk long entry....

 

This market is all about "reading" and making sense of the data....if you have the skills its a walk in the park...if not....you probably have a sense of frustration....

 

Wishing everyone the best of luck

Steve

 

Hi Steve -

 

Even though Asia couldn't do it, I am hopeful that Europe can continue the push upwards through the 1324 area. I project the push to start around 11:30pm PST. Thoughts?

 

Thanks for all your posts.

 

CYP

[roztom 10]

Thursday's Market: What "might" we anticiipate for today? Globex traded inside yesterdays RTH... /we probed the CLVN 1317.50 so what is reasonable..?

 

What is the market waiting for... ?

 

Look where we are going to open RTH..what is it saying?

 

Would you trade today any differently than yesterday?

 

If so, how? Why?

 

Regards,

 

Tom

[clmacdougall 11]

Thursday's Market: What "might" we anticiipate for today? Globex traded inside yesterdays RTH... /we probed the CLVN 1317.50 so what is reasonable..?

 

What is the market waiting for... ?

 

Look where we are going to open RTH..what is it saying?

 

Would you trade today any differently than yesterday?

 

If so, how? Why?

 

Regards,

 

Tom

 

 

What in the Sam Hill are you trying to do to us Tom? I don't want to think for myself, it hurts when I do that!!:doh: I want you to do all the thinking and then we can put you down when you make even the smallest mistake at the end of the day.

[roztom 10]

:haha:

 

What in the Sam Hill are you trying to do to us Tom? I don't want to think for myself, it hurts when I do that!!:doh: I want you to do all the thinking and then we can put you down when you make even the smallest mistake at the end of the day.

 

If you think I have the answers we are ALL in big trouble... :helloooo:

 

That's why I asked you guys the question..

 

Here's how I see it and what I am doing differently... today

 

This market is "currently" in balance.. it will probably probe both extremes of Value from yesterdays RTH. 1320.25 on the low and 1325.75 ish on the upside...

 

When we opened in the middle I saw the Opening range test yesterdays IBH.. this was a tip-off to me to watch for a short set-up.. I confirmed it with DElta and the Magic-8 ball took a short for a test of the lower value area and yesterdays close + CHVN 1319.75.. covered and reversed & took some out the other way.on the long side..

 

For me today it was/is Inside out, outside in..with the VAL/VAH as areas to be probed..

 

If we break out of balance then I would "go with" and position with the direction...until that happens I would trade rotations...

 

Are yesterdays targets on the upside still in play? Yes. But we might only nick yesterdays high or maybe not at all .. as far as yesterdays high goes there is no tail so it wasn't rejected IMHO just lack of buying -- in MP we call that a local high.. it "could/should" be taken out in the future... maybe today/maybe not - no clue - except it is there..

 

Again I might be totally off and this can change as the market generates new info...

 

It's just to demonstrate a read of the market at this time / the open of RTH and the information MP/VP can provide..

 

Hope this is rational and helpful.. This is a piece of what I take from MP/VP.

 

Regards,

 

Tom

Edited February 2, 2012 by roztom

[iwshares 10]

If I am right in my entry my risk is small and I have great trade location...

 

How true! As a trend trader (spot forex but considering futures so following this thread intently, especially the MP/VP stuff which I have found very fascinating - I find different types of support and resistance compelling) the 100+ point trades often come from 5/6 point risk positions. Perhaps it's a case that the market volatility contracts until the point where it has to break somewhere, and our systems point the right way to be when that happens. Very interesting to see someone else have that experience

[clmacdougall 11]

:haha:

 

 

 

If you think I have the answers we are ALL in big trouble... :helloooo:

 

That's why I asked you guys the question..

 

Here's how I see it and what I am doing differently... today

 

This market is "currently" in balance.. it will probably probe both extremes of Value from yesterdays RTH. 1320.25 on the low and 1325.75 ish on the upside...

 

When we opened in the middle I saw the Opening range test yesterdays IBH.. this was a tip-off to me to watch for a short set-up.. I confirmed it with DElta and the Magic-8 ball took a short for a test of the lower value area and yesterdays close + CHVN 1319.75.. covered and reversed & took some out the other way.on the long side..

 

For me today it was/is Inside out, outside in..with the VAL/VAH as areas to be probed..

 

If we break out of balance then I would "go with" and position with the direction...until that happens I would trade rotations...

 

Are yesterdays targets on the upside still in play? Yes. But we might only nick yesterdays high or maybe not at all .. as far as yesterdays high goes there is no tail so it wasn't rejected IMHO just lack of buying -- in MP we call that a local high.. it "could/should" be taken out in the future... maybe today/maybe not - no clue - except it is there..

 

Again I might be totally off and this can change as the market generates new info...

 

It's just to demonstrate a read of the market at this time / the open of RTH and the information MP/VP can provide..

 

Hope this is rational and helpful.. This is a piece of what I take from MP/VP.

 

Regards,

 

Tom

 

Would I be right to say that you are trading the rotations within the previous days value area?

[roztom 10]

The questions I asked pre-market are the questions you should be asking yourself..

 

What is the market trying to do..?

 

What did we learn yesterday in RTH (Other Than I got Nicked on the IBH Trade)?

 

What about Globex? How did it trade in relation to yesterdays RTH? Did it trade differently than it has recently? What does that suggest for today?

 

Should you have a different plan for different conditions...?

 

Can you make $ today? Can you make $ with yesterdays strategy in todays market?

 

I'm just asking... The answers are very important IMHO..just my 2ct

 

Hope this helps..

 

Regards,

 

Tom

Edited February 2, 2012 by roztom

[roztom 10]

Would I be right to say that you are trading the rotations within the previous days value area?

 

That is correct. Inside out/outside in from the edges to each VAL/VAH... with an eye on yesterdays high since it wasn't tested.. but I am more interested in the rotations... right now..

 

What is the market waiting for? News... What Major report is tomorrow? Employment.

 

If we get going on the upside and break out of this balance then the market will have changed until then... Helmet on...

 

Regards,

 

Tom

[steve46 12]

Hi Steve -

 

Even though Asia couldn't do it, I am hopeful that Europe can continue the push upwards through the 1324 area. I project the push to start around 11:30pm PST. Thoughts?

 

Thanks for all your posts.

 

CYP

 

There are several "pre-position" time periods for the Globex market one of which I WILL comment on

 

The primary pre-position time frame for the US market usually extends from about 3:30 to 5am PST

 

At that point, knowledgable participants "vote" by putting a position on.....some might speculate that institutions actually try to move the market prior to that time period so that they might get into favorable positions prior to specific events....

 

The reason we trade the Globex is that we have the experience necessary to know when to get involved and how to act.

 

Regarding timing....markets "anticipate" specific events including economic reports and in this environment, meetings having to do with Euro monetary crisis. Because the world is so interconnected, you can assume that Global money institutions will wait for each event based on timing before they act so as to insure that they have all the data...most markets are waiting for Chairman Bernanke to speak before committing further funds to market.

 

We placed our "bets" based on our view of world events several days ago....and then we trade around that basic position....our next action took place at 5am this morning and we did trade the open (and we are managing a position now).

 

We expect a test of 1329 sometime after the lunch hour...and of course events can alter those expectations....so we simply watch (like the rest of you) and react to events as they happen.

 

The attached chart shows the timing of our most recent long entry

 

Hope this helps

Steve

[CYP 10]

:haha:

 

 

When we opened in the middle I saw the Opening range test yesterdays IBH.. this was a tip-off to me to watch for a short set-up.. I confirmed it with DElta and the Magic-8 ball took a short for a test of the lower value area and yesterdays close + CHVN 1319.75.. covered and reversed & took some out the other way.on the long side..

 

Tom,

 

What does the Magic-8 ball say about tomorrow's Employment report?

 

My 8-ball didn't work too well last night...:rofl:

 

BTW, thanks for all your posts --

 

-CYP

[clmacdougall 11]

There are several "pre-position" time periods for the Globex market one of which I WILL comment on

 

The primary pre-position time frame for the US market usually extends from about 3:30 to 5am PST

 

At that point, knowledgable participants "vote" by putting a position on.....some might speculate that institutions actually try to move the market prior to that time period so that they might get into favorable positions prior to specific events....

 

The reason we trade the Globex is that we have the experience necessary to know when to get involved and how to act.

 

Regarding timing....markets "anticipate" specific events including economic reports and in this environment, meetings having to do with Euro monetary crisis. Because the world is so interconnected, you can assume that Global money institutions will wait for each event based on timing before they act so as to insure that they have all the data...most markets are waiting for Chairman Bernanke to speak before committing further funds to market.

 

We placed our "bets" based on our view of world events several days ago....and then we trade around that basic position....our next action took place at 5am this morning and we did trade the open (and we are managing a position now).

 

We expect a test of 1329 sometime after the lunch hour...and of course events can alter those expectations....so we simply watch (like the rest of you) and react to events as they happen.

 

The attached chart shows the timing of our most recent long entry

 

Hope this helps

Steve

 

Hi Steve, why do you expect a test of 1329 sometime after lunch? Thanks

[roztom 10]

There are several "pre-position" time periods for the Globex market one of which I WILL comment on

 

We expect a test of 1329 sometime after the lunch hour...and of course events can alter those expectations....so we simply watch (like the rest of you) and react to events as they happen.

 

Hope this helps

Steve

 

Well put Steve..yesterday I posted several targets on the upside: 29.75 - 33.00 ish.. We didn't get there yesterday but yesterdays high is weak IMHO... like spaghetti..

 

After lunch will be interesting...

 

Regards,

 

Tom

[roztom 10]

Tom,

 

What does the Magic-8 ball say about tomorrow's Employment report?

 

My 8-ball didn't work too well last night...:rofl:

 

BTW, thanks for all your posts --

 

-CYP

 

I have no clue... I don't predict, I can't predict. Trading for me is not predicting but detecting. I just trade what I perceive is the market generated information which is a reflection of the participants and I can interpret it incorrectly as anyone else.

 

I wait for my areas, confirm the set-up, place my trade, manage it.. etc.. It either is successful or it isn't.. If I follow my plan - win, lose or draw on any trade - I win...

 

Regards,

 

Tom

[roztom 10]

I thought I'd mention a trade I just took and it can be a loser, of course...might be - this is just to share the thinking..it could be the wrong thinking..

 

The market rotated as we anticipated... We had RE on the upside and tested VAH 1325.75... I won't post what I did up there since it is past already... but you knew the plan..

 

Here is what I am doing now... I took a long off the 19.25 area... Here's why...and nobody should do this...

 

IBL/and stops under it/Bottom of yesterdays Closing Swing 1318.75 & CHVN 1319.75 and most revealing IMHO only 40 contracts traded 1318.75

 

Will it work? Is it right? NO clue...

 

If I don't like what I see I will bail.. but the market did have information there that could be actionable.. Let's see how it develops..

 

Please do not do this trade.. it may have further extension down..

 

Regards,

 

Tom

 

Here's my update: I took a loss on the trade.. this is ok - for me... My next area down is CLVN 1317.50... this has been an important area.. I repositioned long against that...

 

 

Another item of interest... and I have no clue if the downside is over or whether we will go for the stops under yesterdays low...

 

In MP we have a Neutral Day.. both sides are active and currently are in balance... "Theory" in MP is that unless something changes we will at least go back to the middle at some point..we can actually do anything as you know..

 

After taking the loss I just repositioned lower - I must manage this position... Good Trading & do not follow the trade.. please..

 

Regards,

 

Tom

Edited February 2, 2012 by roztom

[clmacdougall 11]

Any stop and scale points would be appreciated Tom, if not too busy.

[roztom 10]

So I am long, have scaled already and have made back almost all of my loss from the last long... and sitting..

 

So now what? Where are stops resting on the other side?

 

22.00? higher? Will we rotate up to the DVAH again..take out yesterdays high? No clue..

 

It's lunchtime...

 

Good Trading..

 

Regards,

 

Tom

[roztom 10]

:angry:Please remember - there is no magic pill for this... and I really hope nobody takes these trades... the purpose of my posts is to share just one way of using MP/VP and the NODES... As you know I do not stand in front of the nodes but when they align with other market generated information and the area is confirmed as a qualified set-up, for me - I take the trade..

 

Please remember the purpose of this thread is to share information - not call trades... I'm sure there are better traders lurking here.

 

I only want to share a thought process and how it aligns with some of the market generated information in MP/VP.. I have no corner on great trading.. just some tools..

 

We all want to make $ trading.. However, I think it might be as important or more than the set-up for me to demonstrate how I lose $...

 

We don't see too many of those posts do we? I'm sure we all take losses - right? If I post -a set-up I will also post the losses otherwise I'm just wasting your time and mine.. that is not my intent..

 

Managing the risk of the trade is key... knowing where you are wrong... or if internals say you are wrong... IT's the risk that will take you out of this business.

 

I do not blindly put a stop in and wait to get run over.. I do always have a stop but it rarely gets taken. I am usually out before and take a small loss unless the market reacts extremely to some item..

 

I hope you can see that the MP/VP may have a place in your arsenal... It is not easy to learn since at least to my thinking there is so much useless information attached to it..

 

Regards,

 

Tom

Edited February 2, 2012 by roztom

[roztom 10]

I'll post an update: 12/;52cst...

 

I had previously posted 22.00 as a point of interest.. I took another scale there.. Why? Bottom of OR and top of "I" period...stops are/were there, VWAP, etc Todays Open, Yesterdays VPOC - all of those items told me to scale and that area "might" be an obstacle if even only temporarily... All of that information is on your chart or a Profile...

 

That's my thinking - discretionary but planned ahead..

 

As Steve said: You have to read the market.. I still am managing the last part of my position and depending on the structure might always add or reverse...I have no clue...

 

Regards,

 

Tom

[TheNegotiator 13]

Haha what an exciting day I've missed! Lol. Although I would point out that just because the range isn't large doesn't mean the chances weren't good. I can spot at least 3-4 nice entries at prices we've had an interest in recently.

 

What a lovely looking bell profile and an inside day(so far). Anyone for a move tomorrow?

Edited February 2, 2012 by TheNegotiator

[roztom 10]

Haha what an exciting day I've missed! Lol. Although I would point out that just because the range isn't large doesn't mean the chances weren't good. I can spot at least 3-4 nice entries at prices we've had an interest in recently.

 

What a lovely looking bell profile and an inside day(so far). Anyone for a move tomorrow?

 

Yes it was a very tradable day... ..Perfect MP Neutral...

 

Regards,

 

Tom

[steve46 12]

Another nice Globex long entry at about 9pm PST

 

This one was relatively easy to take because in addition to testing an underlying demand node, we had confluence of Value, and time (Singapore close to closing)

 

So we take the trade, and watch the screen with one eye while we check out "Person of Interest" and "Mentalist" on TV..

 

We also watch our Bloomberg for news and scan the local news for econ reports.

 

As with all good longs, it was preceeded by a move into wholesale territory, followed by a patterned response indicating a reversal. Once we see the response, we know that professional interests are going to be interested in buying that bargain and (hopefully) marking it up.

Edited February 3, 2012 by steve46