To the TBPS…
You know: I don’t care what anybody says but Wilder is/was a genius.
The hit rate of this system is absolutely uncanny.
The above being said: just take a look at the chart below of the Dow Futures (Daily). Safe to assume that momentum is up right??? Wrong!!! If you carefully analyze his momentum concept and then spend the time laboriously calculating the MF and TBP: you will quickly find that upward momentum has run out of steam for now. So I’m now short the Dow and S&P with TPs set at S1 for both. These trades I don’t need market internals for i.e. they’re set and forget.
OBVIOUSLY the system is not 100% accurate (but at LEAST 70% as he says and from what I’ve seen since I’ve come back to it then that percentage has been higher for at least the last month). So MAYBE the rally continues. And maybe it continues but only AFTER trading down to the TP levels. But if it’s wrong: I already know even before the close to day at what price the Dow has to close ABOVE in order to stop and reverse the (then wrong) trade.
Obviously what I’m also looking for today are tick rallies into pivot levels. So a rally into R1 or R2 or R3 will give me shorts (in addition to the TBPS trades described above).
Anyway. Enjoy.
Dow Futures Daily 16072019 1056
Out for 485. TBPS and pivots.
MF for the Dow is still down but I closed the TBPS short at a small profit i.e. the TP was missed intraday (although the S&P short went like clockwork). Could have left it open for tomorrow and moved the TP. Just felt like being flat I guess. Tomorrow is another day.
508.40. And the market’s not been open an hour. ■■■■ yeh!!!
You cannot beat this ■■■■. Klaar.
Now we sit and wait for $TICK extremes to fade the moves brought on by the unsuspecting.
And make that another 105.
Actually: I think I’m done for the day (unless TradeStation fires off an audible tick extreme signal of course).
And another 127.50. That’s it. I’m tired. Done. Later. Tomorrow.
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Out for 835.25. But may get an opportunity to short into the close. We shall see what the ticks say.
Add a carton of cigarettes: +376.50!!! LOL!!!
Total: 1 211.75.
Done. Anything over and above this before the close is pure greed an nothing else.
“Bulls make money, bears make money, pigs get slaughtered”
Been a bull today. Been a bear today. Don’t wanna be a pig today!!! LOL!!!
Time for dinner and then have a read of some very interesting threads that have been lively while I’ve been working.
Well. That’s charming. These ■■■■■■■ Iranians just cost me 1 859.60!!!
One and a bit days of slog gone. Poof. Bastards. Mind you. Cannot blame them solely i.e. ■■■■■■■ rest of the world cannot leave well enough alone.
Oh well. That’s the way the crumble cookies I guess.
These were pivot trades that are always closed just before the close no matter what. Painful as it should be: it’s actually not. Just didn’t work out today is all. And quite a pity really i.e. we were in the middle of a nice rally, the ticks were playing nice, everything was good. And all of a sudden the ticks dropped through the floor as did price. And then the news hit on Bloomberg. And that was that. The market attempted several recoveries on the way down i.e. the ticks went from one extreme to the other. But there just wasn’t anything to sustain any upward pressure i.e. no sooner did they rally and they were pushed down again. I make the assumption that the attempts to stop the fall and move up were either idiots trying to catch a falling knife or stops being taken out or both. Fortunately for my risk based position sizing the loss was negligible in the bigger scheme of things. I could have bailed a bit earlier and the loss would have been a bit less but not by much i.e. once the ticks fell off of a cliff that was an opportunity to close out a bit earlier. But I thought I’d hold out i.e. seen this same action a few times since having the market internals and on all other occasions moves such as this have been nothing more than a good flushing out of weak positions and price has turned on dime and rallied. Unfortunately not today.
As some may know I should be in the market soon enough to replace my SLK. But then I found this tonight and I’m thinking meh: go big or go home!!!
Always wanted an S-Class with the MB GUARD spec. Didn’t realize they came out in a Maybach flavor. That’ll do me nice. I’m sure I could fit a guitar or two in the boot. And my dog would love the back.
Well. That WAS a nice open. Sort of ran out of steam after the first 30 mins. Ticks still trending up though. So could still have a rally of sorts today.
Still have TBPS longs from Friday of course.
Anyways. I guess we shall see. The trading day is but an embryo.
One thing that I’ve begun doing (just in case the Iranian’s and the US and the UK decide to kick off) is to start placing stops at ATR(14) above or below the last SIGNIFICANT swing high or swing low on the 30m charts. Rather unlike me to implement such things. But not in the mood for a repeat performance of Friday. Would rather get stopped out, wait for the next pivot level to be reached, and if that’s done in conjunction with some form of extreme tick reading, get in at a better price. Seems prudent to me (at least until this lot have sorted themselves out anyway).
Back to the land of dreams…
It just occurred to me: may as well use Wilder’s stops for the intraday tick trades. So ignore the last part above. Makes sense to me anyway. Those stops are just pivot + or - the True Range. Simple.
I can already see that this is going to be one of those infuriating days. @ES volume was low at the open which is supposed to be a pretty good indication as to whether or not we’re going to chop around all day or get some decent movement. And so far: nothing. EU markets also been lack lustre today (noted even by Bloomberg). So I’m guessing we’re going to hang around the entire week waiting for big tech. earnings.
May as well find something useful to do.
Been so busy mucking about on other threads I’m neglecting my own well being here!!!
I encountered a strange phenomenon last night. The NASDAQ closed above its TBP thus indicating either a long trade OR to remain in the long trade from the day before. The Dow and the S&P, however, both closed BELOW their respective TBPs. Given that I am a firm believer in the notion that the NASDAQ “leads” I decided to go with the (NASDAQ) flow and leave all longs open (Dow, S&P, and NASDAQ) instead of stopping and reversing on the Dow and S&P and thus far with spectacular results (although as is usually the case when I post here the trading day is but an embryo). I will admit though that a part of my reasoning here is that fact that big tech. is reporting this week and if Microsoft’s performance and results are anything to go by: the NASDAQ should continue it’s grind upward for a day or two or three. I know that one should not be factoring this in when trading a purely mechanical trading system but hey: cannot ignore over a decade’s worth of experience I’m afraid.
This all being said though: just because two were out of kilter with the other does not necessarily mean that the signals are incorrect. It does not necessarily have to be a binary outcome. It could very well be that the TP on the NASDAQ long is executed and then these markets tank for some or the other reason and the TPs on both the Dow and the S&P shorts are also taken out (just probably not on the same day is all).
Anyway. Let’s see what the day brings.
Well the US Futures like Boris!!!
A slight adjustment to order placement.
Somewhere above I posted that I was placing orders just south or north of pivot levels. And the order prices were based on calculating the difference between the two pivot levels, dividing that by the Fib. no. 21, and offsetting the orders by the value of the pivot level plus or minus the result of this calculation. Well today I sat and watched TP levels get missed by the absolute slightest of margins and the markets then turned. So from now on I’ll be using Fib. no 13 as opposed to 21. And after checking back on charts: this will catch 99.9% of any limit orders placed (whether they be entry or TP orders). Obviously this comes at a cost (albeit very slight) i.e. profits are slightly less and entries are slightly earlier or at a worse price. But this business of orders being missed by tiny margins is enough to do your head in.
It’s not very often that price trades right to a pivot and then turns as if by magic. The move has to be with some conviction for that to happen (and usually in that case trades right through the pivot). One has to bear in mind that when placing these orders: price has to trade through the order price by the order price AS WELL AS THE SPREAD. So if you look at a chart and just look at highs or lows at or around a pivot level it may SEEM as though the above adjustment isn’t necessary. But you’re note seeing the required extra for the spread.
The above applies across the board i.e. to pure pivots, traded with or without market internals, as well as any TBPS orders.
To demonstrate the above.
The TP was set exactly at R2. Within the white block it can clearly be seen that price got close. Matter of fact: the last red spike in the white block even looks as though it did the job. It didn’t. But I’d then set the TP (after the fact) as per the calc. detailed in my previous post and this is indicated by the purple line (this being an actual trade). Clearly had the TP been set using the calc. it would have been executed.
Dow Futures 5m
Note this a tick trade i.e. not TBPS (TBPS would have had me in a short trade today) (but worth noting that as of the time of this post the SL has still not been hit although a stop and reverse would have indeed been required tonight as it sure does appear as though the Dow is going to close ABOVE its TBP for today).
BUT THEN and as if by magic!!! LOL!!!
No sooner had I take a screenshot of the above chart and the ticks exploded and below is what happened i.e. all TPs were hit in an instant (this on the China news).
How do ya like THAT for a trade!!! LOL!!!
I must say that I’m finding more and more that I’m going WITH the market as opposed to being a contrarian most all of the time (this with $TICK). Makes a refreshing change for me to begin with. And must say it does feel pretty good. A lot easier and calmer going WITH the market as opposed to fighting it.
There are exceptions to the above of course e.g. always fade R3 or S3 and always fade extreme $TICK readings. That type of thing.
Dow Futures 5m
By the way: I’m flat right now. The red line is a limit sell order just south of R3 as per the calc.
And here’s the accompanying $TICK 5m for the above:
$TICK 5m 23072019 2052
You’ll also notice the extreme tick reading at the open. The cash market opened and tanked big time. I missed the trade because I WAS ■■■■■■■ SLEEPING!!!
Anyway. That’s it. As noted: I’m now flat for the day and all TPs hit and with a semi-decent profit for the day. Reckon it’s time to pack it in (unless I get an extreme tick reading of which TradeStation will audibly alert me).
One last thing with the TBPS:
I may have mentioned this before but to re-iterate: if using Wilder’s stops make sure to use the LARGER of EITHER the TRUE RANGE or the 14-day AVERAGE TRUE RANGE.
At some point I shall attempt to collate all of this information into a coherent document but which will probably end up being commercially available along with a discounted sub. to TradeStation. Not quite sure about this at this particular time but am toying with the idea nevertheless.
Lastly and while I’m still wide awake and on a roll:
I stand by my earlier analysis that the S&P it going to make another new record high and that’s going to be that. And we are almost there.
Also interesting to note that according to one of the Options Houses (yesterday) there is some huge Put Option on the SPY and that expires at the end of next week. In other words: somebody with a lot of money has a $1.5B (as in BILLION) short term bet that the S&P is going to tank after all of these big tech. earnings have been done and dusted and out of the way (regardless of the figures). That’s no joke.
Also very interesting to note (and I cannot say that I was aware of this and have not really worked it out for myself) that according to Bloomberg: the S&P has not moved more than 1% in either direction for the last THIRTY ONE TRADING DAYS (talking about the CASH INDEX here i.e. it may not appear to be so on a Futures Chart).
Well. Four earnings beats one after the other just after the close. All beating estimates.
Needless to say: long entries being signaled on all three (Dow, S&P, NASDAQ). Am waiting for the open of the Futures and will go long at market (unless a gap up in which case will place limit buy orders or just skip the trades altogether). TPs will be placed as per the calc. detailed earlier this evening. And then it is time for bed. Gotta tell ya: trading intraday is taking its toll as are these late nights. Not entirely sure that this is sustainable in the long run. Not in this timezone anyway. Not unless an entire change in daily routine is implemented anyway. Fine for now though I guess.
