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Tim:
After drawing the lines (or even while deciding where to put them initially)
how much weight do you place on "best fit" and subtle redraws to "best fit".
Thx.
I have yet to find a really good technique for establishing price
objectives. I currently most often use an indicator that tells me when it
gets to a certain level there is a greater then 60% chance of a reversal.
However the only way one gets the larger trends that way is by "feel", which
is okay but not always operating without a hitch :).
----- Original Message -----
From: "Timothy Morge" <timothymorge@xxxxxxxxxxxxx>
To: <realtraders@xxxxxxxxxxxxxxx>
Cc: <actionReactionLab@xxxxxxxxxxxxxxxxx>
Sent: Friday, October 21, 2005 10:50 PM
Subject: Re: [RT] My impression is that many had a bad day
> Joe:
>
> My apologies for being so late in getting back to your question. I taught
> two seminars and two refresher courses in the past two days and I am
> b-e-a-t with a capital B, so to speak...
>
>
> I take your question as a completely honest one. No worries.
>
> In point of fact, what irritated me about the earlier post someone made is
> that the pitchforks on the chart you are referring to, and the ones posted
> here, were chosen by a proprietary computer algorithm--they were not drawn
> by me. The used tells the program the criteria for "dominant" pitchforks
> and it comes back with any that fit the criteria. In this case, that was
> the match for the criteria that, along with a bit of proprietary logic
> regarding pivot selection, held 9 or more bars between pivots.
>
> Although I draw many of my pitchforks, many are also selected for me by a
> computer program that was built to mimic the selection process I go
> through--so that 1) People that don't have the 30+ years I have with
> pitchforks get some of the benefit of my pivot selection knowledge when
> using the program correctly and 2) it allows me to teach traders in
> seminars at the CME and the CBOT and then especially when they first start
> trading with pitchforks, I can have a ten minute session, via a
multi-media
> conference or in a trading and tell them that for today, for instance, the
> two dominant pitchforks I recommend they start out with have settings of
> XXX and YYY and they simply plug those settings into the software those
> dominant pitchforks appear on their charts. They can then transition into
> drawing their own pitchforks, or learn how to use the inputs for the
> software and use it to select the dominant forks for the day.
>
> One last thing: It DID become a more important pitchfork once price tested
> it on the downside on October 18 and price reverses after touching its
> Lower Median Line Parallel. But the fork was there, chosen by the criteria
> given the software, well before then.
>
> Let me say one last thing on the subject: I am not anti-system trading in
> any way, shape or form. My partner was part of the original Unix
> development team in the 1970's [while I was at the University of Chicago]
> and we have many wonder trading systems. I also spend too much money to
> count daily, weekly, monthly and yearly doing in-depth statistical
analysis
> on my own use of pitchforks in the tens of thousands of trades I make. I
> have been keeping images and concise records of each of my trades since
> 1982, when I was a very large institutional trader and had the benefit of
> the funding at the time to be able to afford lots of computing power at a
> time when that was expensive. I have all those records and have had the
> luxury over the years of having all the trades put into useful databases
> that allow me to do research on each of the trade entries and exits I
> employ in my trading. So I have a great deal of hard core statistical
> analysis on a huge amount of actual trades made using pitchforks. I don't
> throw up hastily drawn lines after the fact and post them on a forum like
> this for my own pleasure of seeing if people go "ooh and ahhh." I am
> comfortable in how I trade and what I show people, because I do a great
> deal of scientific research on my methods.
>
> Is art involved? You bet. Clyde Lee and I periodically discuss this issue
> and it usually comes down to the point where we both agree that some
> portion is science and some is art. In general, I think it is 80 pct
> science and 20 percent art, but with the software I use and with Clyde's
> software, there is more science and less art--but the art isn't gone
entirely.
>
> My apologies for the long-winded answer. I wasn't insulting systems
> traders, because at times, I resemble one. But I felt the comments made
> seemed slanted a bit in my direction, and I would not have responded to a
> system trader that posted his or her charts by saying that my stuff is
> worked great and your stuff, like most other stuff being shown, looks good
> because it is hindsight. Sorry, saying that just isn't right. It isn't
> accurate and it isn't right.
>
> If I totally missed answering your question, Joe, my apologies. Please
> point me in the right direction with another question and I'll try to me
> more exact and more succinct.
>
> Tim
>
>
> At 07:37 AM 10/21/2005, you wrote:
> >Tim:
> >
> >Trading Systems only prove themselves going forward, and can only adjust
to
> >changing market conditions by user adjustment---- just like median lines.
As
> >such this is an honest question not a sarcastic one....
> >
> >On your chart below did you draw the blue PF off the secondary high at
the
> >top because it "fit" the new landscape? If not, how did you figure to put
it
> >there beforehand?
> >
> >Thx
> >
> >
> >----- Original Message -----
> >From: "Timothy Morge" <timothymorge@xxxxxxxxxxxxx>
> >To: <realtraders@xxxxxxxxxxxxxxx>
> >Cc: <actionReactionLab@xxxxxxxxxxxxxxxxx>
> >Sent: Thursday, October 20, 2005 10:16 PM
> >Subject: Re: [RT] My impression is that many had a bad day
> >
> >
> > > Jan:
> > >
> > > I am going to give you the benefit of the doubt and assume you are not
> > > accusing anyone of posting lines drawn "after the fact," especially
since
> > > you mentioned Median Lines after I posted here about my trade
yesterday.
> > > Let's be honest: If I was going to post an after the fact chart, I
> >wouldn't
> > > post a trade I ended up scratching after having six S&P handles in
it--I'd
> > > post a chart where I got long at the bottom and got out at the high.
> > >
> > > I've attached the chart from today, with the exact same major lines
that
> > > were on the charts. Pay special attention to the down sloping green
Median
> > > Line. I believe even you can see that it not only gave you the tops of
the
> > > day seven trading days in a row, but it gave you the high from
yesterday
> > > and the low of today. And the line was drawn and posted, day after day
> > > after day beginning in early October. It's been posted here several
times,
> > > the same line, and it's been posted on my public web site over and
over
> > > again, with updated price data only added. Not what I'd call hindsight
> > > advantage...
> > >
> > > I wouldn't stoop to pointing out that you showed us a string of
"trade"
> > > entry prices as evidence of your prowess, because I have no idea what
you
> > > do as a system trader or what your system is about or whether it works
or
> > > not, so I am in no position to judge it. And frankly, I don't throw
stones
> > > at people. I post my thoughts and my work. Some people may get some
> > > benefits from it, some may not. But I'd prefer not to be slandered,
here
> >or
> > > anywhere else I share my work freely.
> > >
> > > Tim Morge
> > >
> > >
> > > At 01:57 PM 10/20/2005, jan4123@xxxxxxxxxxxxx wrote:
> > > >As they say: use whatever works for you, however, the recent mkt
> >forecasts
> > > >which included some great an some not so great calls and the
discussion
> > > >which followed yesterday's mkt gave me something to think about.
> > > >
> > > >Having watched Median Line's pitchforks which often work, but often
> >don't,
> > > >especially if you draw without hindsight advantage, or Elliott or
Hurst
> >or
> > > >Wolfe, all of them trying to forecast what the mkt will do, but
require
> > > >that you make the right assumptions or inputs or you start drawing
from
> > > >the right point, etc. - i saw a great advantage of having a good,
proven
> > > >system which you follow without trying to forecast. And that despite
some
> > > >past postings here which gave system trading bad rap.
> > > >
> > > >I normally trade EC, but yesterday being in Barcelona and having come
> >home
> > > >to late for it, I traded ES. The attached chart shows all system
trades -
> > > >I have additional rules which would eliminate the trade 11:47 -12:17.
> > > >White arrows are exit signals, but I also exit on double tops/bottoms
> > > >combined with yellow bars, yellow band is 60 period MovAvg band and
green
> > > >lines are Donchian Chnl lines. Other lines are also Donch Chnnl lines
> >with
> > > >higher inputs - 20, 40, 60. The system is based on mkt bouncing from
> >chnnl
> > > >lines or, countertrend, on double divergencies
> > > >combined with very overbought/oversold condition.
> > > >
> > > >System Trades:
> > > >8:40-8:43 -125pts, 8:55-9:12 +200, 9:14-9:31 -100, 9:31-9:45 +375,
> > > >10:02-10:30 +275, 10:31-10:45 -150, 11:01-11:43 +325,
11:47-12:17 -300
> > > >(not taken), 12:17-12:27 -125, 12:32-13:02 +175, 13:01 - not taken,
very
> > > >strong mkt, 13:29-15:14 +1225 ( stayed in trade with lower Donchian
Chnnl
> > > >green line confining the mkt).
> > > >
> > > >This is not to bragg, but in defense of system trading.
> > > >
> > > >My webmail doesn't accept more than 1 attachment, so I'm sending the
2nd
> > > >chart by separate mail.
> > > >
> > > >Jan Philipp
> > > >
> > > >
> > > >
> > > >
> > > >
> > > >
> > > >
> > > >
> > > >
> > > >
> > > >
> > > >
> > > >
> > > >
> > > >
> > > >
> > > >
> > > >-----Original Message-----
> > > >From: Rakesh Sahgal <rakeshsahgal@xxxxxxxxx>
> > > >Sent: Oct 19, 2005 10:51 PM
> > > >To: realtraders@xxxxxxxxxxxxxxx
> > > >Subject: Re: [RT] My impresson is that many had a bad day
> > > >
> > > >Hi,
> > > >
> > > >Was it really all that bad? There were clear
> > > >indications for anyone who CARED to look CLOSELY that
> > > >a low will be put in place for a move to 1200(move
> > > >indicated by some VERY KNOWLEDGEABLE people here).
> > > >Just look at the evidence:
> > > >
> > > >1. In the chart attached you will see that price
> > > >tanked on 10/18 courtesy of the black medianline. This
> > > >median line has caused price to halt in it's track on
> > > >3 occasions i.e. 9/22,10/3 and finally on 10/13. The
> > > >reliability of depending on this medianline was hence
> > > >fairly high, subject to other safeguards that you may
> > > >be using.This chart was first posted by me on 9/27
> > > >with the very same medianline.Just imagine the
> > > >accuracy of people who are proficient with the
> > > >technique using intra-day data would have achieved.
> > > >Personally for me MedianLines have been one of the
> > > >most worthwhile things I have learned and I cannot
> > > >thank Tim Morge enough for this.
> > > >
> > > >2. Once the medianline in question had been paid due
> > > >respect then the lower bollinger of shorter period
> > > >bollinger drawn on the chart was pierced. This is the
> > > >bit thats interesting and which I am not able to
> > > >understand completely and hence unable to explain.
> > > >When price pierces a lower bollinger band and a lower
> > > >bollinger band of a longer length is below the shorter
> > > >period lower bollinger, QUITE OFTEN this acts as a low
> > > >being put in place.
> > > >
> > > >3. Look at the relationship between the stochastics of
> > > >different lengths(same as the bollingers used). This
> > > >time around it was positive. Shorter period Stoch
> > > >above those of longer periods. It was the reverse on
> > > >9/27.
> > > >
> > > >All of the above observations are based on EOD data.
> > > >Leave alone all of what I have written above and just
> > > >focus on the Bline method/system that Judy aka Buffy
> > > >uses. That gave CLEAR indications on an EOD basis that
> > > >things were turning, on an intra day basis one of the
> > > >big days for sure.
> > > >
> > > >As to this being a prelude to a trend change, that is
> > > >not indicated as yet by the chart. Most probably we
> > > >will end up seeing the 1150 range as has been
> > > >indicated on the forum(not by me)after a visit to the
> > > >1200-1205 range.
> > > >
> > > >
> > > >Regards
> > > >
> > > >
> > > >Rakesh
> > > >--- Deosaran Bisnath <deobisnath@xxxxxxxxx> wrote:
> > > >
> > > > > Just a few observations, all of us have bad days,
> > > > > and good days.
> > > > > Am simply stating my take on the disillusioned mood
> > > > > of a few traders
> > > > > I know, and a few trading sites. Daytraders may have
> > > > > escaped unscathed, I
> > > > > barely made it into positive zone, mainly because I
> > > > > was not a believer for most
> > > > > of the day, even though the market was warning us in
> > > > > no uncertain manner. But,
> > > > > when NASDAQ futures relaunched above 1560, I was
> > > > > convinced this was headed much
> > > > > higher. Huge amounts of stops were hit, new shorts
> > > > > entered, all the way up,
> > > > > especially the rally from 1182 to close. Massive
> > > > > daily candle, a KEY reversal
> > > > > day, is it? Pre-Option Expiration Wednesdays are
> > > > > usually wildly volatile, but
> > > > > this one was about the most volatile for some time.
> > > > >
> > > > > As usual, it was the big guys who initiated this
> > > > > move and they were the big
> > > > > winners.
> > > > >
> > > > >
> > > > >
> > > > >
> > > > >
> > > > > __________________________________
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