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Cliff Scheller wrote:
>
> >
> > It is my contention that one could readily apply ANY mathematical
> > ratio to price charts, and have it SEEM to work.
> >
> > To prove my hypothesis, I went to the local dime store, and bought a
> > rubber duck. I then measured the duck's head and the duck's body and
> > from that, developed a ratio set. View the attached gif file
> > to see the results. Amazing isn't it. That duck calls turning
> > points pretty well.
> >
> > The moral of this story is : Knowing where a market MIGHT be turning
> > ( + / - the usual 3 days most turning point gurus give themselves,
> > and + / - the usual 3 or 4 "excuse" days that are also usually
> > thrown into the bargain) isn't enough to trade on.
>
> Walt,
>
> QUACK, QUACK!! Right On!!!
>
> Great post, image, and message between the lines. It reminds me of
> an old joke around college when I was growing up in Silicon Valley:
>
> You can be an astronaut, or a half-astronaut....
>
> Sucessful trading is HARD to do, but the rewards are well worth it.
> It takes many pieces to complete the puzzle. Learners should not get
> hung up on any kind of magic bullet whatsoever. All that will do is
> delay, or even prevent, their financial success.
>
> Cliff
Analysis of the markets is not an easy subject. It seems that there are
so many opinions as to what is the best way to do this or that.
Sometimes, however, when I read 'between the lines', as it were, I read
of statements where an opinion is stated as a fact. Once example is when
a 3 day turn window is considered not a good thing.
By itself, I could see this. But with other criterial or confirmation
indicators to assist, having such a 3 day window is better than ANYTHING
you can find.
Case in point:
If a 3 day window is considered not a good thing by some analyst, do
they have a smaller window? Of course not. What they have are leading
and lagging indicators, which gives you no precise idea of a time frame.
So, if they can't do better, are they really an authority on this
subject?
It usually annoys me when comments are made about those who trade within
3 day windows are 'gurus' who make excuses. These statements are usually
made by those who have not found a way PERSONALLY to use them.
If you want to know about trading time days, you ask those who
specialize in them. If someone has to make excuses for a window that
grows bigger than +/- one day off, then that person specializes in
something else, not pure time days.
If you can't trade time days, don't assume no one else can't. Also,
don't put into the heads of new traders that they must fill their plate
with all kinds of goofy indicators. (read my article on "Indicator-itis"
at Traders Digest, http://www.tradersdigest.com under Articles and The
Ratchford Files).
Just this week, I provided a link to a lesson page I created to help
with time day trading. There is no direct link yet from my webpage, so
you can go there by clicking here ----->
http://FSoftPublishing.com/lessons/bias.htm
Now, my rules deals mostly with my own time days called Fdates, but the
point is to see the application and its validity.
Below, is a message I received today from one of our traders on the TTC
list. I've re-attached his graphic that goes with the questions he asked
and my answers. You will note that although he is not using Fdates, you
can get the jest of the application if you have a real time day that is
highly probable within your "3-day" window, as it were.
It is recommended that you read the bias.htm page I've mentioned above,
and even look at the Fdate Matrix that tells you when to trade the time
day and when not. You will then see that trading time days is not some
wild, flimsy inaccurate method of entry and exit. It is precisioned and
filtered.
AND NOW....THE MESSAGE
===============================
Jeff wrote:
>
> Greetings Rick:
> I've read through your lessons on 'Bias' of the trends and the rules in
> trading FDates. Most of the materials seem pretty clear to me. The
> chart below is a sterling chart with TimeDays (arrows). There are just
> a few more things for you to assist. Please correct and assist my
> interpretations if necessary:
>
> 1) Now, it's pretty obvious that by the time we arrived to 3, we knew
> that we were in a downtrend. The red arrows shown the timedays. We
> would've gone with the down bias and short the market.
If at 2 you had an Fdate, yes.
>
> 2) As we arrived at 6, our bias were STLL towards the downside. Since
> at this point in time, there wasn't any indications of major violations
> of the resistance clusters. The cyan arrows indicate the timedays
> clusters.
I don't use nor like clusters.
According to the rules, we would have short the market again
> at one of these cyan arrows. In this trade, we would've either hit by a
> close stop or exit with a small profit.
Assuming those clusters is an Fdate, yes.
>
> 3) As we moved to point 8 (where it passed 6 decisively), we have
> changed out trend bias from down to up now. The subsequent arrival at
> point 9 along with the timedays meant we would've long the market at
> this point.
>
Yes, assuming of course we met resistance, which is quite obvious now.
> 4) Now we came to point 10 with two timedays. Our bias is still on the
> upside, we would've entered long at this point and ended up getting hit
> by a sell stop.
Look at the Matrix Jeff. This is NOT a pivot or plateau bottom. We would
NOT enter LONG. You must have a bottom at support to go with your Bias
and Fdate. If you had such a time day, it was marking the top, not the
bottom. According to the rules, NO TRADE.
>
> 5) Finally, the market went all the way down to 11 and our bias is
> towards the downside again. At point 12 ( 09/11/97), our bias is still
> on the downside.
No, our Bias is now up. Note the top made the day after 11. This is then
followed by more down days. This is what most traders miss when
eyeballing a chart. The market, however, does not miss this. Thus once
passed, our bias turned UP. We would have gone long ONLY if we had an
Fdate and there was a bottom made at that FDate at pre-calculated
support. We had no bottom made here, just up days. NO TRADE.
The three purple arrows are timedays clusters on
> 09/11, 09/12, 09/15. How would you go about interpreting these coming
> timedays?
As clusters and would have ignored them.
Our bias is on the downside, are we suppose to expect some
> kind of timedays tops to short the market?
Bias is on the UPSIDE. We would wait for a pullback bottom on an Fdate
and pre-calculated support.
>
> Thanks for your assistance in advance
> Have a good one
> Jeff
Hi Jeff.
When we talk of time days, my rules deal STRICTLY with FDATES, not any
of the other time days. Reason is higher probability to make the method
work at optimum efficiency. With other time days, we may need to add
another confirmation tool, like cycles for example. So maybe such rules
would need 4 criteria instead of 3, or you might remove the sup/res
criteria and replace with the cycle criteria.
I designed these rules around Fdates because human error is removed.
Other time days require YOU to enter points of a chart and get a result.
If you did it well, you get good time days. Question is, how do you know
you did well UNTIL after the time day? With Fdates, the computer uses
the same algorithm everytime without my interference, and its
reliability rate is so high that when it does spit out a dudly, that is
easily filtered out by the other 2 criteria. Also, most times, those few
dudleys actually mark the beginning of a big move. I just haven't
developed any rules to help capture those yet as well.
So, that is why I stress FDATES with BIAS | SUP/RES. I've tested it
thoroughly, and it has been a humdinger. Look at your own chart you just
gave me here. You were in profit almost all the time. Only at the time
of a trend change did you exit flat, little profit, or maybe a little
loss. The rest of the time you made money!
Must meet the 3 criteria. Fdate (not any timeday) - Bias - sup/res.
With other time days, other or slightly different rules may need to be
applied.
>
> ---------------------------------------------------------------
> [Image]
cheers!
:)
rick
--
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Market Of The Week Forecast
http://FSoftPublishing.com/forecast/forecast.htm
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