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Bracketing Systems

  • #1
  • First Post: Edited 11:00pm Jan 31, 2007 10:48pm | Edited 11:00pm
Ohh Man, I know eventually I will regret this but I will put it down to my feeling of lack of contribution to FF over the last few weeks.
I reserve the right to fail in response without predjudice.

Trading Basics fall into {IMO} 3 different catogaries...

1) Crossovers... MA's, BB, Oscillators... and the list goes on. {sorry if I missed your fav.}

2) Rigid Lines... Pivots, Fibs, Trendlines...and the list goes on.

3) Breaks...A compendium of 1) & 2) and a couple of other idiosycracies of both added in as well as the occasional individual 'Break' scenario.

Please consider which of the above are more likely to sway Traders from one side of the fence to the other. {my opinion later in post}

1) Crossovers... {Fictitious compilation}
NEWS FLASH!
"Traders! the 20 EMA has just Crossed BELOW the 40 MA." We suggest you SELL based on 20 Bar Old Information."

2) Rigid Lines...{Fictitious compilation}
The 38.2% fib failed to contain the price and therefore we are left with no other comment except to say that the 50% Fib {50% is not actually a Fib} will be the next Test. Let's see what happens there before we decide.

3) Breaks...{Fictitious compilation}
For the last 2 periods {months, weeks, days or minutes} the Price has failed to break 'x'.
This means that for the last 2 periods either the Bulls or Bears have been the Enemy at the Gate and beating on the door. {I love and look for these situations. They are a Spring loading for Fast Recoil or expansion. [Spronnnng]}What would YOU expect if they manage to smash that door down?
Exactly! Pamplona in Fast Forward or Fast Rewind.
A Rapid release of energy!

Point being that, although I do not 100% endorse the "Price is King" enthusiasts, I do know that professional, including "employee" Traders are watching for "Price Breaks" not " 'x' Pips Profit.
The sophmore "Price is King" student is farther ahead but still has a long row to hoe.
25 + years "IN" & still learing.
Chickened out on posting the System Params. Sorry.
  • #2
  • Jan 31, 2007 11:09pm Jan 31, 2007 11:09pm
Quoting Bemac
Chickened out on posting the System Params. Sorry.
I read all that and you end with THIS?

CUMMON' - SPILL IT CHICKEN SHEIT~!
Was funny tho- ive said most of those things myself-lol
  • #3
  • Jan 31, 2007 11:16pm Jan 31, 2007 11:16pm
Quoting C.E.O.
I read all that and you end with THIS?

CUMMON' - SPILL IT CHICKEN SHEIT~!
Was funny tho- ive said most of those things myself-lol
Ohh c'mon now, prove to me you understand the difference between the 3 and then {perhaps} we will move along.

btw. If your nickname is indicative of your life, my guess is you are in telemarketing.
  • #4
  • Jan 31, 2007 11:32pm Jan 31, 2007 11:32pm
  •  tesla
  • Joined Oct 2006 | Status: Friendly Neighborhood Programmer | 533 Posts
Okay, I'll throw my thoughts into the ring for dissemination. I'm sure I'll get people who disagree with me and I can live with that. I will ask though that you disagree/discuss/debate in an adult manner.

Indicators, by and large, are crap. There's no inherit reason for a moving average, pivot point, fib line or trend line to provide any significant support or resistance. The only reason much of the above mentioned stuff has a chance of working is if a significant portion of the trading community pays attention to it.

I use support and resistance levels, trend lines, fibs and occasionally a pivot point. I have no illusions that any of this will forecast what the fair value of any specific commodity will be. I do believe there's something to these which give a clue as to how other people will act when valuation moves to or through a given price. If you find a study/line/point/method that causes enough people to react, there will be a greater preponderance of tradable action.
  • #5
  • Jan 31, 2007 11:59pm Jan 31, 2007 11:59pm
Quoting tesla
Okay, I'll throw my thoughts into the ring for dissemination. I'm sure I'll get people who disagree with me and I can live with that. I will ask though that you disagree/discuss/debate in an adult manner.

Indicators, by and large, are crap. There's no inherit reason for a moving average, pivot point, fib line or trend line to provide any significant support or resistance. The only reason much of the above mentioned stuff has a chance of working is if a significant portion of the trading community pays attention to it.

I use support and resistance levels, trend lines, fibs and occasionally a pivot point. I have no illusions that any of this will forecast what the fair value of any specific commodity will be. I do believe there's something to these which give a clue as to how other people will act when valuation moves to or through a given price. If you find a study/line/point/method that causes enough people to react, there will be a greater preponderance of tradable action.
Perhaps I am missreading your post but if I am not then it seems to me that we are 100% in agreement.
Fibs.{ ask me what Leonardo, [Son of Nacci] had for xmass dinner in 1256 & I probably have a link.}
I also plot Fibs {done a little ground breaking on the subject actually} but often refer to them as NOT BEING BRICK WALLS. They can and often will fail you.

Trend Lines. {I wrote code in VT to work with these.}
It's like being confined to your room as long as the TL Holds. Only when it's Broken,can you go exploring in the unknown.

Different environments + different params + different Traders = Different Grails.
  • #6
  • Feb 1, 2007 12:08am Feb 1, 2007 12:08am
Quoting Bemac
Perhaps I am missreading your post but if I am not then it seems to me that we are 100% in agreement.
Fibs.{ ask me what Leonardo, [Son of Nacci] had for xmass dinner in 1256 & I probably have a link.}
I also plot Fibs {done a little ground breaking on the subject actually} but often refer to them as NOT BEING BRICK WALLS. They can and often will fail you.

Trend Lines. {I wrote code in VT to work with these.}
It's like being confined to your room as long as the TL Holds. Only when it's Broken,can you go exploring in the unknown.

Different environments + different params + different Traders = Different Grails.
My feeling also, is Fibs, pivots, trendlines, etc are all important when price REACTS to these "areas". Price can just as easily ignore these areas, and one has to be aware of when price is actually obeying to these zones and take notice.

As you state, fibs are not brick walls and one must suspect they will fail until proven otherwise.

Interested in what else you have to discuss Bemac, it is always a pleasure when those with a lot experience like yourself, share insights.

Thanks,
Mike
  • #7
  • Feb 1, 2007 12:14am Feb 1, 2007 12:14am
Quoting Bemac
I also plot Fibs {done a little ground breaking on the subject actually} but often refer to them as NOT BEING BRICK WALLS. They can and often will fail you.
More like a hedgerow. It's springy, so you could bounce off, but it is also flexible, so you could pass through.
sxaxlxvxaxtxixoxnxbxyxgxrxaxcxexdxoxtxoxrxgx
  • #8
  • Feb 1, 2007 12:29am Feb 1, 2007 12:29am
I have seen fibs fail and seen fibs work.

I have also seen support levels fail and work.

The reason for both of these is the hype behind them.

If everyone believes that it will bounce off a fib or support and believe it enough to put their money in with their thoughts it will react that way.

If not then it fails.

No matter which way it happens there will be plenty of people on both sides saying "I told you so". But no of those who were wrong will just come out and say it.


Darnell
  • #9
  • Feb 1, 2007 12:43am Feb 1, 2007 12:43am
Why chicken out posting your system? If trends, MAs and fib/pivots are no good... it may help some of those struggling traders.

As far as the rest of your post, people cant make money unless they are in the market. Trend lines will give someone a visual of some point that they think they should get in... thus they do. Now since they are in the market money management will be a factor. Same with MAs. Take Bagovino method, 5 crosses 12, people are now in the gbp/usd... as long as they make more pips than they lose they can make it in trading. MAs are not the reason for their success, it is the reason they placed the order though. Hope I made a little sense.....

I think your system should be good.
The market is my nation. Traders, my family. Hello, brothers and sisters!
  • #10
  • Feb 1, 2007 12:43am Feb 1, 2007 12:43am
There all places where people leave their money for the synical to collect it from them...
  • #11
  • Feb 1, 2007 12:49am Feb 1, 2007 12:49am
Quoting Darkstar
There all places where people leave their money for the synical to collect it from them...
Ahh... spoken like a TRUE Fundamentalist and {insert all kinds of smilies here} I am not knocking that. It's crucial to have a global awarenes when you put your own finances on the Global Line.
Question is, when you have no definative FA to base trades on, do you stand aside or what do you look for in TA?
  • #12
  • Feb 1, 2007 12:58am Feb 1, 2007 12:58am
Quoting Bemac
Ahh... spoken like a TRUE Fundamentalist and {insert all kinds of smilies here} I am not knocking that. It's crucial to have a global awarenes when you put your own finances on the Global Line.
Question is, when you have no definative FA to base trades on, do you stand aside or what do you look for in TA?
I wouldn't consider myself a fundamentalist. I enjoy the economics, but it isn't very useful as a trader. Takes too long to work itself out.

TA is all bullshit. Traders use TA as an excuse to do things in the market, but unless a great number of traders are all looking at the same technical factor to implement their trade, it isn't going to mean anything.

It's all about orders. When the orders are flowing into the market for fundamental reasons I'm a fundamentalist, when there flowing for technical factors in a technician. I guess thats not entirely true either since I'm always counter to what there expecting. I guess I'm just an orderflow trader...
  • #13
  • Feb 1, 2007 1:00am Feb 1, 2007 1:00am
I have traded all three, as most of us who have been around a while have. I currently trade only breaks or bounces through or off of support and resistance lines.

I don't trust anyone else to determine where these lines are but determine my own visually on the charts. It is especially nice when I can get two time frames to line up with the same support or resistance. Gives me that warm fuzzy feeling when the price does what I expect.


Terry Walters
  • #14
  • Feb 1, 2007 1:06am Feb 1, 2007 1:06am
Quoting Darkstar
TA is all bullshit.
Now that's a very large net you cast ther DS.

Quoting Darkstar
It's all about orders. When the orders are flowing into the market for fundamental reasons I'm a fundamentalist, when there flowing for technical factors in a technician. I guess thats not entirely true either since I'm always counter to what there expecting. I guess I'm just an orderflow trader...
So does that put you in the OFACamp?
  • #15
  • Feb 1, 2007 1:18am Feb 1, 2007 1:18am
Quoting Bemac
Now that's a very large net you cast ther DS.


So does that put you in the OFACamp?
That it is.

Whats OFACamp? Order Flow Anonymous? The only thing google has is the Oregon Fencing Alliance...
  • #16
  • Edited 1:47am Feb 1, 2007 1:43am | Edited 1:47am
HA HA hee hee hoo ha heh heh... heh...uh...
um... I don't get it...

Well, ok I admit I kinda like the 200 ema... but not really.
ok just forget it.
  • #17
  • Feb 1, 2007 2:00am Feb 1, 2007 2:00am
That is exactly the point, I hate to quote Michael Douglass here but you are either on the inside or you are on the ouside. Communication is the key to exceptional results, after that trading is the easy part, but that is just one side of it.

For those without access to that sort of information, any kind of analysis can be useful but only to the extent(and this is relatively short term speaking here) that it gives you a probable idea as to how order flow will work itself through the system, and how this can be exploited at low risk.

I was a big fan of volume breakouts, but volume info in the fx market is hard to come by, even long term info lags too much.

So which is my favorite - I would have to say none, everything lags even price action.

The only thing I have found to lead is active communication with those that may be in the know, at least on a relative short term basis.
Man who scratches ass should not bite fingernails
  • #18
  • Feb 1, 2007 2:44am Feb 1, 2007 2:44am
Quoting Bemac

...1) Crossovers... MA's, BB, Oscillators... and the list goes on. {sorry if I missed your fav.}

2) Rigid Lines... Pivots, Fibs, Trendlines...and the list goes on.

3) Breaks...A compendium of 1) & 2) and a couple of other idiosycracies of both added in as well as the occasional individual 'Break' scenario.

Please consider which of the above are more likely to sway Traders from one side of the fence to the other. {my opinion later in post}

1) Crossovers... {Fictitious compilation}
NEWS FLASH!
"Traders! the 20 EMA has just Crossed BELOW the 40 MA." We suggest you SELL based on 20 Bar Old Information."

2) Rigid Lines...{Fictitious compilation}
The 38.2% fib failed to contain the price and therefore we are left with no other comment except to say that the 50% Fib {50% is not actually a Fib} will be the next Test. Let's see what happens there before we decide.

3) Breaks...{Fictitious compilation}
For the last 2 periods {months, weeks, days or minutes} the Price has failed to break 'x'.
This means that for the last 2 periods either the Bulls or Bears have been the Enemy at the Gate and beating on the door. {I love and look for these situations. They are a Spring loading for Fast Recoil or expansion. [Spronnnng]}What would YOU expect if they manage to smash that door down?
Exactly! Pamplona in Fast Forward or Fast Rewind.
A Rapid release of energy!
As for which one is to sway traders more from one side of the fence to the other, at least for over here it is whichever one has proven more profitable over the past month. Traders seem to have a very short memory, and dont put too much thought into what all 3 of these imply when the idea of big $$ clouds their vision..

The difference between the three - well - MA's and fibs are similar in construction. They both measure an average of past price - where an MA measures time bars at eitheir mean or weighted avg as an example, fibs measure an average of sorts on a constant expanding and retracting range giving certain weight importance at different levels - once price reacts enough to a certain level and bounces off of it or moves through it, that level is considered an important fib - not really because it is a fib, but because it is the mode average within the range(the fact that it is the mode is what truly gives it some importance, the fact that we only look for it at fib levels is questionable, although since it may be widely used I guess it is a level worth noting as well) - as for the 50% line of range, also an average known as the midrange.

As for breaks - they are completely based on range and mode within the outer barriers of that range that measures long lasting contained dispersion, again the importance lying in mode(how many times does it hit a level and bounce off). The difference between breaks and fibs or anything else involving mode is that breaks involve multimodal zones increasing the likelihood for higher volatility around them. Volume is normally a consideration because knowing the depth of market a volume confirmation would indicate a clean break from this multimodal zone.


Just an opinion
Man who scratches ass should not bite fingernails
  • #19
  • Feb 3, 2007 4:31pm Feb 3, 2007 4:31pm
OK, we have thought for a few days on breaks.
After due consideration, it is my opinion that Horizontal Breaks are more important than Angled Breaks.
New High {or Low}is more important than New Break of an angled fib or even an Angled TL.

Don't get me wrong here. Fibs are really important and for the Fib Followers I would suggest that you check out my thought proccess that says...
"As Long as the 23.6 holds, the Trend is intact."

BUT. Traders now have become accustomed to the fact that, Changes in the market are but a Click away and therefore must add another dimension to their thought proccess.{I remember opening a think tank in 98 to uncover our corporate strategy based on uneducated Traders moving price}
The Bull Objective {in my opinion} has become "Make Todays High Higher than yesterdays." Vice Versa for the Bears.
I believe this to be true. [actually, always has been]

So... contributers willing... I would like to concentrate on, not calculated Pivots or extensions but moreso on barricades of resistance and/or support.

{If you are getting the impression that this may take some effort on your part, you are correct. Nothing is free AND easy.}

This thread will address recognizing significant Horizontal breaks.

Things to consider Before you Post.
The Sunday/Monday opening of ALL Markets is 6 Trading Days beyond the Last Weekly Open.
Compare Last weeks Open to this Weeks Close.

The two major markets London & NY {for a period in time} are open simultaneously.
What happens when they are in agreement? What happens when they are in discord?

Honestly, it's not a teaser but if you understand it, you can utilize it.
  • #20
  • Edited 5:27pm Feb 3, 2007 4:51pm | Edited 5:27pm
Quoting Darkstar
I wouldn't consider myself a fundamentalist. I enjoy the economics, but it isn't very useful as a trader. Takes too long to work itself out.

TA is all bullshit. Traders use TA as an excuse to do things in the market, but unless a great number of traders are all looking at the same technical factor to implement their trade, it isn't going to mean anything.

It's all about orders. When the orders are flowing into the market for fundamental reasons I'm a fundamentalist, when there flowing for technical factors in a technician. I guess thats not entirely true either since I'm always counter to what there expecting. I guess I'm just an orderflow trader...
I think of your style of trading is more like Remora Analysis. It is not Technical nor is it Fundamental. It is completely reactionary. That is in my opinion a better way to trade. It requires no prediction and no postdiction.

However, Darkstar you must admit it requires quite a bit of experience and some intuition. After all you are looking for a familiar price action that in the past has produced results, regardless of what you call the method.

It is because of your knowledge of the market you trade, that you know what you know. and with some help from news stories, (like stops and options and such) that you are able to put the pieces together and place the trade that has been more successful than not...

Is that Pattern recognition? Is it Fundamental? perhaps.. who cares, it seems to work, you have predefined rules and you are right more often than you are wrong.

Now this thread has some legs... Thanks Bemac.

Edit: Bemac, I just read this thread again, and I may be off topic with this post. If you wish, I will remove it.. Nice thread though.
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