Trading with Price and price only

[jacinto]

First of all, thank you for taking the time and post on my journal

Why does anybody want to trade "on price only" when there is is other (very useful) data available to assist in making trading decisions. Quite frankly it makes no sense to me at all.

funny, to me, trading with indicators makes no sense at all. there have been many discussions about it on this BB, and i wouldnt like to start a new one. I would only say that each to their own on that front, with the addition that some selected indicators may be of use in particular situations ( i do have a spare chart with 3 indicators, but dont base my setups on them...just keep an eye for SR)

The accompanying chart of the current session of the DAX says it all. It shows the difference in volume at bid and ask smoothed with a 7 bar EMA. Looking at how this ratio is changing tells a lot about the transition of market sentiment. The chart also has VWAP and developing market profile upper and lower value areas but that is another (rather interesting) story.

well, 2, actually 3 things.

1) volume: i would love to trade with volume but unfortunately in FX you cant get that. guess that answers the first question in a way. (although, i guess if i had a futures account i could see volume on FX contracts )
2) a moving average is by definition lagging (to the extreme, if i use a SMA of 1 period on closes, then i might as well trade on a line chart). i'drather use the source.....i.e. price.
3) dunno and i am not familiar with VWAP so no comment.

again thank you for your comment, i appreciate different views from my own. they can help you learn a lot.

j

Edit: sorry, didnt comment on your chart. funny, I only see a down channel. no need of indicators for my eyes.

 

[jacinto]

j.

looks like that **** up trade could turn out to be very profitable in the end, although i'm sure tony tiger will be after a cut of the profits....

more seriously this is such a difficult thing for me as well and i'm learning from this thread lots already. why is it that i can sit there hold a trade and watch my stop get hit and then go oh well i got it wrong. but cant seem to bugger off and leave a trade on, not great when i'm also trying to trade off slower time frames.

there must be some kind of pschcological s##t to do with control or something...plus the voices in the head dont help either....

keep it up m8.

bd.

thanks for your comment brutus. hope my comments dont make you go back instead of pushing you forward

never thought this journal would lead to something different than price based setups etc, and instead shift towards psychology. guess it makes sense. trade with nothing but a set of lines, fib expansions, etc...and the only thing one gets is a recipe for a psychiatrist to come and sort one out

my learning for the time being is that the advantage of trading with price and price only is that you have THE indicator ....price. the disadvantage is that trading with price you get yourself!!!! and that can be a formidable enemy :!:

the whole excercise has been interesting. due to lifestyle issues, i have been forced to focus more on 4 hr charts, no daytrading, selecting pairs, selecting setups, etc. no trading here since the cockup, simply missed the second entry, and have been away all day today. not looking forward to a trade tonight. this process still has me thinking, and it has been good for me to be out with the kid......kind of forces me to think what i want to do with my trading style going forward.........never thought the obvious path would be swinging.......time will tell.

thanks again for your comment, deeply appreciated.

j

 

[wasp]

I'm not so sure the pyschology factor should be that deep, you just have to remind yourself when you want to go to bed, day or night, if i get stopped out, i get stopped out same as if i was watching the market is all.

 

[jacinto]

I'm not so sure the pyschology factor should be that deep, you just have to remind yourself when you want to go to bed, day or night, if i get stopped out, i get stopped out same as if i was watching the market is all.

stuff in bold, i am still not sure if i agree...then again, lets leave it like that, dont want to make an issue out of it and divert something that doesnt need being diverted

stuff underlined, i agree 800% (100 + phill mibutz 700 pips )

j

 

[dcraig1]

First of all, thank you for taking the time and post on my journal

funny, to me, trading with indicators makes no sense at all. there have been many discussions about it on this BB, and i wouldnt like to start a new one. I would only say that each to their own on that front, with the addition that some selected indicators may be of use in particular situations ( i do have a spare chart with 3 indicators, but dont base my setups on them...just keep an eye for SR)

I think you are missing the point. If we define an "indicator" as some transformation of the OHLCV price series then it is true that by definition an "indicator" cannot carry any more information than the original series. It is personal preference whether the altered presentation helps or not. (I'm deliberately ignoring breadth indicators for simplicity here).

However what I was getting at is that there is other data available than the OHLCV price series this is usefull. The volume at BID/Volume at ASK difference is one such piece of information. What I was trying to show is a graphical representation of one of the factors a tape reader would be taking into account. And I what I was also trying to show is that the indicators/no indicators debate is grossly deficient because it is always limited to price Vs some transformation of price. Price changes through the matching of orders in the order book and I reckon that should be of interest to any trader who has anticipated hold times of less than a week. The trick, of course, is to extract something useful from this. The indicators/no indicators "debate" asks the wrong question.

1) volume: i would love to trade with volume but unfortunately in FX you cant get that. guess that answers the first question in a way. (although, i guess if i had a futures account i could see volume on FX contracts )

Agreed. Each to their own poison in choice of market. I have had a cursory look at FX futures and the order book/T&S behaves differently to stock index futures. I put this down to FX futures being dwarfed by the cash market but I could well be wrong about this.

2) a moving average is by definition lagging (to the extreme, if i use a SMA of 1 period on closes, then i might as well trade on a line chart). i'drather use the source.....i.e. price.

True. I don't like the term "noisy" much, but some things are just too choppy and have to be smoothed to see the bigger picture. Using smoothers on price is a different issue.

Edit: sorry, didnt comment on your chart. funny, I only see a down channel. no need of indicators for my eyes.

After the fact. Look at the highest point on the chart and how the sellers are becoming more aggressive as suggested by the increasing volume of trades at the BID.

All this is not to suggest that S/R and trend are not important, but that there are other inputs (other than price time series) that can make a big contributions to making good trading decisions.

That's it. I wont clog up this thread with any more posts.

 

[jacinto]

Dcraig

thank you again for taking the time to comment. truly appreciate your view.

j

 

[jacinto]

july 19th

managed to go long on cable @ 497...looking for a scalp (using 15 min charts), ended scalped. closed for -8. price made a move up, but failed to make a new high, immediately came down, and closed when i came back to the screen to see it. didnt wait for my stop to be hit, and just cut the loss short. original stop still hasnt been challenged, but it is close. 4 pips away as i write.

instead, i will now wait and trade off the 4hr chart. eyeing this new pattern. we shall see. my bias is clearly for the long side, but confirmed trading below 450 would change my stance to neutral-range and adjust my strategy accordingly.

 

[jacinto]

july 23rd

Being in charge of my 4 year old has forced me to look back into 4 hr charts, and only focus on those setups. cocked up 1 trade last week. would have been profitable indeed. that is in the past. Friday, timewise, my window of opportunity was rather narrow, and also missed trades, but thats ok, made the decision to close my platform early thinking there would be nothing. charts are cleaning up, which is good and gives opportunity for setups

this week, i will be looking at these 2 pairs, and will post another 1 or 2 setups for other pairs in another post later on..... still calculating possible pullbacks and targets. (will be engaged with a barbecue...if the rain permits

euryen: looking for a dip to around 166.50 to enter a long targeting 300 pips

cable: im looking for 2.0655, and basically just waiting for an entry.

 

[jacinto]

will start keeping an eye more closely to USDCHF in the next few days for signs of reversals.....on a breach of 1.2070

 

[jacinto]

im starting to think that we may expect some profit taking this week, or a congestion at the very least between 500 and 600.

i still have no setup or anything that would suggest that apart from price reaching target on a monthly measured move.

 

[jacinto]

will start keeping an eye more closely to USDCHF in the next few days for signs of reversals.....on a breach of 1.2070

i didnt have the patience ...but did go in. out now for +50......wait for a retrace for a swinger :cheesy:

and with euryen, had to put my money where my mouth is on the charity trade, left a limit to short at 168.00 and now at breakeven....:cheesy: exit 16655

 

[jacinto]

took 1/2 out on euryen @ 167.10 for +90 (i.e. 45 on full position), so a nice productive day in total....+95

 

[jacinto]

may recalculate long entries on euryen tomorrow......exit at 166.55 stands though

nite nite

 

[jacinto]

may recalculate long entries on euryen tomorrow......exit at 166.55 stands though

nite nite

:cheesy: out at 166.55 :cheesy:

 

[jacinto]

euryen july 24th and 25th

Being in charge of my 4 year old has forced me to look back into 4 hr charts, and only focus on those setups.

euryen: looking for a dip to around 166.50 to enter a long targeting 300 pips

cable: im looking for 2.0655, and basically just waiting for an entry.

OK, euryen dipped to 166.5, but I have decided not to go long....yet. These things come in three's as Hook Shot rightly says. Problem is I hope i am counting correctly.

Im expecting a pullback to around 167.30 and then a move down to 165.75ish where a confluence of events should give the entry for the swinger. I may short later targetting that level and then reverse long.

I am with my kid, and she is getting tougher by the day ...in any case, the week is already with good profits

Oh, i didnt enter the cable trade. went to target nicely

edit: added chart with close only prices

 

[jacinto]

Im expecting a pullback to around 167.30 and then a move down to 165.75ish where a confluence of events should give the entry for the swinger. I may short later targetting that level and then reverse long.

filled :cheesy: and a stop at BE :cheesy: off to the park

 

[jacinto]

1/2 covered for +80 @ 66.50

although i wonder why i didnt take the long for the pullback to 67.30.....oh well

edit: covered remainder at 65.90 for +140. this was faster than expected.

 

[jacinto]

24 july summary

OK, just have to make this summary

a) I havent reversed long. this move happened too quickly and i am suspicious. i will rather wait until it exhausts itself. i think it will happen when it meets 165.75 as a false breakout of a congestion that will happen between now and tomorrow london open (moreless)..... (congestion between 165.90 and 166.35) if it hasnt reversed already by the time i woke up

b) I made a mistake by not going long 66.50....should have simply bagged the 80 pips. should have put my money where my mouth was with the charity trade.

c) had a good entry, and exited on a measured move (see second chart)

d) I wont take the reverse just yet. This time i will wait till tomorrow. will call it a night (after i see what a couple of peeps are up to with their fibs )

e) was a good day. +80 (real +40) on 1/2 and +140 (real +70) on remainder for a 110 day. cant complain. yesterday was similar with +90 (+45 full position) and +145 (+72 full position) and + 50 on swissy. Week is good so far.

g) I am taking my kid to legoland tomorrow, so if i dont get an entry long to my liking, i will have to wait till i come back.

OK, I am posting 2 charts

First chart is a continuation of chart posted above (missed long 166.50 and short from 167.30) target is @ 165.75.

second chart is the measured move on 60 min charts (everything the same except for labels.

It has been a good day. I have to digest many things and post my lessons. happy of this excercise so far
feel like i have a pip-atm card

 

[trendie]

excellent trading, j.
you might take DC2000s mantle as T2Ws master-of-the-universe.

 

[jacinto]

excellent trading, j.
you might take DC2000s mantle as T2Ws master-of-the-universe.

thanks trendie

if i were dc, i would be long already

got to digest stuff, this excercise has steepened the learning curve.

j