ES tonight

This is a discussion on ES tonight within the Trading Journals forums, part of the Reception category; Hi Paul, To be perfectly honest, I do not know what the reasoning is...Because I am just starting to learn ...

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Old May 17, 2009, 9:43pm   #316
 
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Hi Paul,

To be perfectly honest, I do not know what the reasoning is...Because I am just starting to learn about pivots and the like thanks to Garry's excellent journal, I am following much of his reasoning while I observe and test this type of method, as well as try to see if pivot points could form the basis of a useable trading strategy (for me at the least).

I agree with you that there is, intuitively, more sense behind floor pivots and in my testing, I intend to observe both FTP and CAM (e.g. the multiplicative factor of 1.1/4 etc... in the CAM calc seems arbitrary). I would also note that I have read some sketchy things about CAMs in older threads on both this site and elite trader but also good thing.

At the present time, I am thinking of pivots, be they CAM, FTP, DeMark or whatever else, as areas where the trader expects/believes that price will react in a certain direction. Now, if price reacts at this level in the anticipated fashion, I would postulate that this level was indeed significant for market participants. The question that remains is whether or not the pivot point calc stumbled upon this level by accident or that the equation is indeed a reliable predictor of important S/R terms in and of itself. Based on a limited amount of observation at this point, I have seen price respect these S/R levels almost to the tick on some occasions and blow right through them as if they didn't matter on others. While Garry has recorded success in this journal by merely playing the price levels as calculated, I suspect at this point that the use of additional filters to help confirm the move at the identified level should increase the risk-reward ratio of the trades. For example, if a higher time frame is in a downtrend, as established through other means, I would argue that maybe the trader wouldn't want to play a long off the reversal long line just because the price was hit. Perhaps, the move would be to allow price to figure out what it wants to do. If it bounces off the support, great...allow it to come back up to a level where you are prepared to go short and take that trade; if price shoots through it, then perhaps allow price to come back up to the RL line from underneath and see if there is some momentum behind it to justify a cautious long or, on a fail of that level, an additional shorting opportunity.

Then again, perhaps all a load of rubbish...your thoughts and impressions are appreciated

Regards,

Ivor
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Old May 18, 2009, 8:25am   #317
 
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rathcoole_exile started this thread just checking in while i've got 5 minutes -
fridays figures were
889,5
894,25

884,75
879,5

just noticed the wonderful reversal short from 894,25 almost to the penny :-)


with regards to your question about Cams - i have no idea why they are computed thus and i originally dismissed them as a gimmick.
but then i read someweher that traders at international banks use them as their secret weapon . dont know if true or not, but lead me to re-look at them, and observation over time has convinced me of their effectiveness ......
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Old May 18, 2009, 8:27am   #318
 
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rathcoole_exile started this thread ive got today figures (mon 18) as:

893,5
888

878
872,5
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Old May 18, 2009, 10:29am   #319
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I will look up the formula for Cams (unless anyone knows them here ?). If it is used by large institutions then that is a good enough reason as to why they work. With all of these pivots and S / R levels it is about where a high density of orders are likely to be triggered.


Paul
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Old May 18, 2009, 3:45pm   #320
 
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rathcoole_exile started this thread i have posted the formula before, somewhere on the thread already.

but as to why it should or shouldnt work vis-a-vis FTPs I cant answer .... other than by repeating that observation has proven worthwhile
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Old May 18, 2009, 4:48pm   #321
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Thanks RE I will go back and check.


Paul
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Old May 18, 2009, 11:01pm   #322
 
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Hi Paul,

Below are the equations for CAM (in case you couldn't locate them). I read on elite trader that there is a site on the internet that started selling CAM signals in the early part of this decade but that they have never officially disclosed the formulae that they use. What is below can be found freely on the internet and I believe that someone "cracked" the equations by guessing and testing, though I cannot be sure. The levels that Garry uses for his kill zones are R4 (break-out long), R3 (reversal short), S3 (reversal long) and S4 (break-down short).

R4 = C + RANGE * 1.1/2
R3 = C + RANGE * 1.1/4
R2 = C + RANGE * 1.1/6
R1 = C + RANGE * 1.1/12
PP = (HIGH + LOW + CLOSE) / 3
S1 = C - RANGE * 1.1/12
S2 = C - RANGE * 1.1/6
S3 = C - RANGE * 1.1/4
S4 = C - RANGE * 1.1/2

Cheers

Ivor
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Old May 19, 2009, 9:41am   #323
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Thanks Ivor, I would rep you but I must have done recently as I am not allowed to rep you again so quickly.


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Old May 19, 2009, 9:57am   #324
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Are you trading futures rather than stocks nowadays Paul? I noticed your interest in the ES/dow threads recently. 'Pitbull' seems to have moved primarily to trading the dow from his previous 'mr.charts' style of stock trading. Indicies getting popular again...?....
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Old May 19, 2009, 10:21am   #325
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I am trading futures and forex. For me it requires less time and a lot less financial commitment than when I traded stocks.


Paul
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Old May 19, 2009, 10:25am   #326
 
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Quote:
Originally Posted by Trader333 View Post
I am trading futures and forex. For me it requires less time and a lot less financial commitment than when I traded stocks.


Paul
I guess you were trading US stocks Paul, for me I've moved to trading Forex from UK stocks due to the low volmes, 6 months ago there would be 50000+ shares at most 1/4 ticks on the order book in HSBC now there may be 10000 then 2000 1/4 lower then nothing for 1/2p makes for too much gapping and more difficult to get in/out of a position of any size.

PS Sorry Rath for taking this well off topic
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Last edited by foredog; May 19, 2009 at 10:40am. Reason: Add PS
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Old May 20, 2009, 7:57am   #327
 
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rathcoole_exile started this thread 4dog, you're most welcome, it's nice to see you here .....

if no other board members ever came along except the calibre of the likes of you, Ivor and Paul, I'd take that any day :-)

looks like a nasty tight range yesterday but i think i would have missed by one point the trigger for the one good move south of the day.

for today, looks like this
913,25
909,75

903,25
899,75

am off to see Toots & the Maytals later - coem all the way to hamburg for business only to discover legends are playing a gig tonight :-) :-)

even though i seem to be the only one who has heard of them ......
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Old May 20, 2009, 11:18am   #328
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You like a bit of Reggae then ?


Paul
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Old May 20, 2009, 2:33pm   #329
 
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[QUOTE=rathcoole_exile;770114]4dog, you're most welcome, it's nice to see you here .....

if no other board members ever came along except the calibre of the likes of you, Ivor and Paul, I'd take that any day :-)

Hi praise Garry...trying not to blush as I read

looks like a nasty tight range yesterday but i think i would have missed by one point the trigger for the one good move south of the day.

I had the CAM BS at 916.25 and I think the pre reg session high was 915.75 so no dice. However, the FTP (908) and DeM RS (912.25) would have kicked in had you been following. The first would have been a wash but the DeM would have got you in for the very late afternoon selloff

QUOTE]
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Old May 22, 2009, 7:55am   #330
 
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rathcoole_exile started this thread fri 22
901,75
895

882,5
875,75
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