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What-O Bob
How's life? Re- your question about books on 'how to read the tape', I
really haven't a clue!
I don't mean that in a frivolous way, just that I really do not know of any
book that covers the subject. After all, it is really just a way of saying
'learning to trade by reading what the market is doing.' You will have read
"Reminiscenes of a Stock Operator" and really that is what the book is all
about - only in those days, it really was a tape!
Nowadays, it is a question of reading the chart(s), looking a support and
resistance, where the market has stalled, paused, reversed and broken out.
Getting to understand the market and the way it moves, the previous
encounters of a similar kind (copyright!!), etc.
My manual is a-coming along, but my trading comes first. I did get
pursuaded by DBC Signal to do a seminar for them on trading the T-Bonds in
London.. It was meant to be for half a dozen to a dozen people for one
evening, but in the event turned out to be for three evenings of 50 people
each. It seemed to go down very well, and while I have had some very kind -
indeed even glowing - e-mails and calls, I also had one, which I thought
really would amuse you, as a Bond trader, and here it is, including the main
part of my answer:
>Dear Bill,
>
>Some weeks ago I attended one of your seminars on T-bond trading -
>".....earn a living, etc........".
>Subsequently I signed up for receipt of live data ex-CBOT and away I went.
>Or thought I did.
>
>Only, it ..er.. hasn't been quite like you said.
>
>You see, the T-bond has been subject to wild sudden swings in the extreme.
>On the 5th, 6th and 8th of May, for example, 70 to 80 ticks up or down
>within 6 minute bars, have been common. There is no warning, these swings
>just happen.
>
I dont believe it is possible to trade under conditions like this. If I had
>held a position just before these moves I would, by now, have been all but
>wiped out
Dear Mike
Somewhat mystified to get your e-mail. Just what have you been trading?
The days that you gave me are all fairly small range days for the Bonds, as
you can see:
Date Open High Low Close
5th May 120^02 120^10 119^29 120^00 Daily
Range: 13 ticks
6th May 119^30 120^15 119^27 120^12 Daily
Range: 20 ticks
8th May 120^10 120^14 119^21 119^31 Daily
Range: 25 ticks
Where on earth you are getting your 70 or 80 ticks from, I really do not
know. It sounds to me as if you have been trading the S&P, which does
indeed make swings of that order within very short order - including 6 min
bars (what an unusal figure?).
Anyway, I would certainly agree with you that it would be impossible
to trade under these conditions.
Do please telephone me if you wish. I really am appalled at your
situation. There is something very wrong and you are not trading the
T-Bonds. Not from what you have said. You can see the figures above and
they are easily checkable.
++++++++++++++
I've not had a reply yet, but as you can imagine I was quite shattered to
hear from this chap in this way. Can't think what on earth he was trading,
let alone how. The mind boggles...
I promise I have made a list of people who have said that they would like to
know when my manual is out. I've put a target date of Independence Day and
will do my best to keep it. At least 60 or 70 people on RT have written to
me, but I really do think that someone of your experience may well find it
too simplistic. As you are aware, I don't think much of indicators and
moving averages or the like, but I do have a very, very high regard for Mr
Fibonacci and his summation series, as applied to support and resistance and
in 'looking left' - all of which can be summed up, if you like, as 'reading
the tape'.
Anyway, I promise I'll let you know when it's available
Good luck - and keep posting to RT, it is always good to hear from you.
Kind regards
Bill
-----Original Message-----
From: Bob Hunt <RHunt.066@xxxxxxxxxxxxxxxx>
To: t-bondtrader@xxxxxxxxxxxxx <t-bondtrader@xxxxxxxxxxxxx>
Date: Wednesday, May 13, 1998 12:48 pm
Subject: Bond Market Tape Reading
>Hi Bill,
>
>In your posts in RealTraders you've mentioned the importance of tape
>reading a number of times. What books would you recommend on the
>topic?
>
>Also, when is your manual going to be available and how would one go
>about requesting a copy?
>
>Thanks in advance,
>Bob Hunt
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