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Where can I learn more about Price Action like those in James16 charts? 9 replies

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james16 Chart Thread

  • #44,781
  • Sep 28, 2009 7:47pm Sep 28, 2009 7:47pm
Quoting thesnacker
I have a little saying printed in BOLD above my monitors.

DON'T THINK
HAVE RULES
PLAN
EXECUTE
Someone that trades a strictly rule based system and refuses to think might as well write an EA and go to the pub.

Rules are great for beginners, they stop them doing stupid things. At some point, you get beyond that - as Ben put it, 'why would I want to trade like a robot?'... he just got beyond it a little quicker than most

What if your rules are wrong? An efficient market is always going to render some of your rules invalid at some point in the future. The turtle traders that everyone idolises had 'rules' - if you tried trading by them now, you would blow your account.

Everyone works differently. Some people like rules, and dont want to exercise judgement. It imposes discipline, I guess. And that is fine - if it works for you, awesome.

Personally, I'd rather put my money in an index fund than follow a strict rule based system. My alpha comes from evaluating a situation, processing the information presented and positioning myself accordingly. ANd I know a ton of people that work the same way, and consider judgement an integral part of their 'system'.

Horses, courses, etc.
When you have to shoot, shoot. Dont talk.
  • #44,782
  • Sep 28, 2009 7:48pm Sep 28, 2009 7:48pm
Quoting StoragePro
Nice. We are attracting this kind of thing more now since the commercial forum. You are not the only one abused.
Opensource jerkoffs preaching 'information wants to be free!' as a cover for wanting to steal people's work and/or have some sense of nerd superiority?
When you have to shoot, shoot. Dont talk.
  • #44,783
  • Sep 28, 2009 7:48pm Sep 28, 2009 7:48pm
Quoting dmc
My rules say dont try to catch falling knife lol
Got to get bloody and start somewhere.

In athletics there is this thing called muscle memory, as you perform a certain action many, many times your muscles start to build a memory for the action, such as shooting a basketball, a golf swing, throwing a football, etc. To a degree it is the same in trading. But in trading its like building bad habits or good habits.

I mentioned rules so that you can filter the good and bad habits. Sometimes there is no better way to learn than catching the knife, whether winning and losing and developing your own rules over time.

http://en.wikipedia.org/wiki/Muscle_memory

Good Luck dmc

-snacker
  • #44,784
  • Sep 28, 2009 8:00pm Sep 28, 2009 8:00pm
Quoting cvcamper
Please advise, Ive got a killer PB formed on the Daily on GBP/JPY.... Right off of weekly support... Break is at 143.13
Okay I am in on the break of the daily pin... 1st target it 1st fib at 143.75... 2nd target is 2nd fib at 145
Dr. C
  • #44,785
  • Sep 28, 2009 8:06pm Sep 28, 2009 8:06pm
Quoting joelcf
Someone that trades a strictly rule based system and refuses to think might as well write an EA and go to the pub.

Rules are great for beginners, they stop them doing stupid things. At some point, you get beyond that - as Ben put it, 'why would I want to trade like a robot?'... he just got beyond it a little quicker than most

What if your rules are wrong? An efficient market is always going to render some of your rules invalid at some point in the future. The turtle traders that everyone idolises had 'rules' - if you tried...
Agreed for the most part, I think you misinterpreted where I say "DON'T THINK'

When I say 'DON'T THINK' I meant, when you see a pattern, setup, PA, don't think about it to the point of paralysis by analysis. I meant don't try to psyche yourself out by thinking what will happen if it goes against me or for me. Have a plan/rules for when the setup goes against you, and have a plan/rules for when it goes for you. That way you can mitigate the emotional aspects and trade the chart.

regards

-snacker
  • #44,786
  • Sep 28, 2009 8:08pm Sep 28, 2009 8:08pm
I guess we will see what happens. I just can not be a member of a board that condones this.

Que

Quoting StoragePro
Nice. We are attracting this kind of thing more now since the commercial forum. You are not the only one abused.
Que
  • #44,787
  • Sep 28, 2009 8:13pm Sep 28, 2009 8:13pm
Quoting joelcf
Opensource jerkoffs preaching 'information wants to be free!' as a cover for wanting to steal people's work and/or have some sense of nerd superiority?
True, whether something is open source or closed is the decision of the author of the code, not the users.
  • #44,788
  • Sep 28, 2009 8:17pm Sep 28, 2009 8:17pm
Quoting thesnacker
Agreed for the most part, I think you misinterpreted where I say "DON'T THINK'

When I say 'DON'T THINK' I meant, when you see a pattern, setup, PA, don't think about it to the point of paralysis by analysis. I meant don't try to psyche yourself out by thinking what will happen if it goes against me or for me. Have a plan/rules for when the setup goes against you, and have a plan/rules for when it goes for you. That way you can mitigate the emotional aspects and trade the chart.
I completely agree - planning is the essence of everything.

I just think some people (not you, obviously) get so stuck on 'rules' that they get into bad trades that they should have been able to avoid, or pass on great trades which they should have been able to take... all because it doesnt fit their rules (which they usually stole out of a book or off the internets anyway). SO they either continue to miss opportunities/take bad trades, or they rewrite the rules to accomodate new information... which makes it a discretionary system with a lag

It's why mechanical systems either suck to begin with, or suck after the opportunity has been arbitraged away but they dont know any better.

Quoting thesnacker
True, whether something is open source or closed is the decision of the author of the code, not the users.
uh oh, the /. nerds are going to lynch you for that
When you have to shoot, shoot. Dont talk.
  • #44,789
  • Sep 28, 2009 8:25pm Sep 28, 2009 8:25pm
Quoting Que
Does anyone know how long it usually takes an Administrator to respond to a complaint?
....
just be patient, they will respond.

Quoting StoragePro
Nice. We are attracting this kind of thing more now since the commercial forum. You are not the only one abused.
Hopefully this will end soon. Twee & others are working on this commercial forum issue.



Quoting Que
Sent what I could. Not rich, but gave what the bills allowed. My families prayers are with you...
On a positive note...
thanks Sir!


[ i just came from the disaster relief center of 1 of the big media firms here. muscle work for 12 hours, lol (having been malnourished, do i have muscles, lol ). if the forecasted potential storm/s (possibly 2) hits mid-week/next week, i may have to volunteer for 2-3x more (the floods have not completely receded).
Thank you ALL & God bless! ]
  • #44,790
  • Sep 28, 2009 8:39pm Sep 28, 2009 8:39pm
Quoting joelcf
I completely agree - planning is the essence of everything.

I just think some people (not you, obviously) get so stuck on 'rules' that they get into bad trades that they should have been able to avoid, or pass on great trades which they should have been able to take... all because it doesnt fit their rules (which they usually stole out of a book or off the internets anyway). SO they either continue to miss opportunities/take bad trades, or they rewrite the rules to accomodate new information... which makes it a discretionary system with...

I, for one, do not believe we operate sans 'rules' - yes, that is the correct term. Even the most discretionary player, when his trades are teased apart, operate on a very solid set of rules that they perhaps have not articulated or are easily able to. Think about why you take a trade or not - I bet you have a very clear set of reasons, that actually repeat over and over again.

The best traders kind of go by 'feel'. At least on the surface.

For every trade posted here where someone states 'common sense' or some other ethereal reason, notice how they then go about describing the chart.... rules. Longer term traders do get to the point where another sense begins to operate - I've noticed in me - but upon reflection and examination, information was on the chart that in hindsight was shouting at you - and at least the subconscious mind was listening making you feel the way you did.

I had a great example today of a trade I entered and jumped out of for a small loss because of 'feel'. It was a Yen cross, and it stalled - and after I got out it reversed hard. Whew. But I had looked at the other Yen crosses and they had reversed moments earlier - and that got into the dark corners of my mind - and saved me.

There is no hocus-pocus. Just a rational mind - sometimes working in the background.

Now - Joel makes an excellent point (bolded above). That is what happens to every single trader at the start, until market exposure and intelligence begins to form. While what we do here is best described as 'discretionary', think of the rules set (what a bar looks like, a PPZ, location etc) and then the finer points - bar size, minor PPZ's, kinds of traffic that shade traders experience - and soon, if you are diligent, you see enough of this kind of action to fine tune your understanding and when you will begin to act.

Having a set of solidly defined rules gives purpose and direction. If you are a live trader, and you make money, you have rules you use. Period. If you did not have rules governing your activity, you'd either be paralyzed or broke - or both.

Of course you have to read all of the above with the understanding that we are not talking about 'Systems'. Systems do not work.
I'm pretty much done with all this ...
  • #44,791
  • Sep 28, 2009 8:45pm Sep 28, 2009 8:45pm
Quoting benji533
By the way, here is what I like to do when I'm bored and there are no good intraday setups. These are stress free trades, and I don't care about the lame R:R, it's better than just knowing where price is going, looking at it doing what out thought it will do, but not making the money out of it - that's lamer
I generally pass on this kind of 'barb wide' action, where price is flat and oscilating around the EMA. It is easy to make a couple of pips (since you really do know exactly where price is going and where it should stop), but it doesnt seem worth the effort.

Al Brooks talks about this kind of action in his new book 'Reading Price Chart Bar by Bar' - covers it over a couple of pages somewhere in the middle. Its probably the best part of the (exceptionally poorly written but useful) book. You would probably like it.

------
The bit of extra return doesnt seem worthwhile for the -EV if it does decide to break out against you. I figure trying to trade setups you know are C trades, at best, is just boredtrading. I'd be better off playing a couple of tables of poker, or working on my terrible golf swing, or reading.

Or...my new game for the quiet periods is spreading and scalping ticks on the 10y/30y tnote/tbond futures using L2 DOM and T&S.

Pinbars are a lagging indicator
When you have to shoot, shoot. Dont talk.
  • #44,792
  • Sep 28, 2009 9:01pm Sep 28, 2009 9:01pm
Quoting StoragePro
Think about why you take a trade or not - I bet you have a very clear set of reasons, that actually repeat over and over again.
Absolutely. I guess my issue isnt with rules, per se, but more with the strict application of them. The edges need to be grey, not clear black/white delineations.

Hell, my dishwasher can engage in fuzzy logic... I should be able to as well.

Quoting StoragePro
The best traders kind of go by 'feel'. At least on the surface.

Longer term traders do get to the point where another sense begins to operate - I've noticed in me - but upon reflection and examination, information was on the chart that in hindsight was shouting at you - and at least the subconscious mind was listening making you feel the way you did.
I guess this is the level I aspire to - I moved through unconsciously incompetent, consciously incompetent and I feel I am somewhere in the consciously competent area at the moment... its that next step, the unconscious competence that people call 'feel' or 'instinct'.

You get flashes of it now and then... but that is quite different from being rac and making money just by being within 15ft of a price chart.

Quoting StoragePro
Systems do not work.
This should be in the page header for FF... though you would lose 90% of your traffic

----

You are definitely my favourite forex philosopher. Its a whole level removed from 'hey guys, what about this pinbar?', and I always walk away reconsidering something about how I think or act.

You should write a book. It would kill Van Tharp and Mark Douglas.
When you have to shoot, shoot. Dont talk.
  • #44,793
  • Sep 28, 2009 9:23pm Sep 28, 2009 9:23pm
Quoting joelcf
----

You are definitely my favourite forex philosopher. Its a whole level removed from 'hey guys, what about this pinbar?', and I always walk away reconsidering something about how I think or act.

You should write a book. It would kill Van Tharp and Mark Douglas.
OK - now you've lost your mind.
I'm pretty much done with all this ...
  • #44,794
  • Sep 28, 2009 9:29pm Sep 28, 2009 9:29pm
Quoting StoragePro
OK - now you've lost your mind.
No one ever claimed otherwise.
When you have to shoot, shoot. Dont talk.
  • #44,795
  • Sep 28, 2009 9:33pm Sep 28, 2009 9:33pm
Quoting StoragePro

...master the basics. And be picky.
I recently had an interesting conversation with a trader - who remain anonymous as requested, and I asked about how to eliminate stress in trading, as I tend to feel it too much. The answer was not earth shaking - I KNEW the answer - it won't completely go away, but much of it can be eliminated by:

Drum roll please....

Be very careful, dare I say 'extremely picky' about what trades you take. Only the best suffice.

Hi Guys, abit behind on the thread. Have been trawling through Fiji's section on the PF & doing a heap of thinking & reflecting.

SP, your post really hit it home for me. Thank you!

I have been asking myself "why do you take less than optimal setups? why do you trade rubbish?"

Why do I trade? To make money. (Duh)
Why make a heap of money?
To get all those things I want in life, freedom from the job, the finer things in life, provide family with security, etc etc etc.. endless list.

So somehow, I realised that I've been thinking, ok, to make more, take advantage of opportunity the market offers to you. The more you're exposed to opportunity the better your chances of making more... WRONG.

Recently, I read of 2 brothers who took 200k to 200m. (yeah. no shi!t guys)
In 10 years.

I did the math and you know what it came down to on average / week?

1.33773% / week
I was like. Wth? No @)%&*#%() way.
Rechecked THRICE.
It's right.

So I was thinking... that's 1 good trade / week, risking 1%, and < 1:1.5 R!

Though I've been here only for 2 months, I know pretty well, that the material James and the seniors have been teaching, can give at very least, if not better than 1.33773% / week... IF I'M PICKY!

Granted, there'll be some weeks where there' just nothing to really trade.. but there're other weeks, like last week on the GBP pairs that just gave some really slick R:R.

Picky Picky Picky Picky Picky Picky Picky
Consistently Picky!

1 A grade trade / week in the 4hour roughly = 2% to 3% a/c growth

Thankfully, of late, the rubbish, I've managed to stick onto my demo, and the "woohoo!! get me IN NOW!" trades, I've managed to stick in my live a/c.

And guess what, there haven't been many "GET ME IN NOOOWW!!!" trades, but they're there nonethless... if I WAIT

It's really the stuff btw my A+ trades that have kept my account at BE.

Firstly, A grade trades dont happen that often, some get stopped out @ BE, others at an "ok" R:R. Others run to the moon, but not THHAAT often.

Secondly, the < A grade trades are alot more common and often result in 1/2 to full bar losses. These little jack asses eat up the returns from A / A+ trades. (keeel dem allllll )

Someone just flipped on a flood light
One Mind, Any Market
  • #44,796
  • Sep 28, 2009 9:35pm Sep 28, 2009 9:35pm
Quoting joelcf
No one ever claimed otherwise.
Cool. Brothers in Arms - we will now commence to rule.
I'm pretty much done with all this ...
  • #44,797
  • Sep 28, 2009 9:43pm Sep 28, 2009 9:43pm
Quoting Cyrus

Someone just flipped on a flood light
  • #44,798
  • Sep 28, 2009 9:50pm Sep 28, 2009 9:50pm
Quoting joelcf

Absolutely. I guess my issue isnt with rules, per se, but more with the strict application of them. The edges need to be grey, not clear black/white delineations.

I guess this is the level I aspire to - I moved through unconsciously incompetent, consciously incompetent and I feel I am somewhere in the consciously competent area at the moment... its that next step, the unconscious competence that people call 'feel' or 'instinct'.
Something I read by Bruce Lee actually spoke to me heaps about this topic.

Martial arts context, but hey, principles are principles.

" The height of cultivation always runs to simplicity. (think Jim, Mike, Rac, etc)
Before I studied the art, a punch to me was just like a punch, a kick just like a kick.
After I learned the art, a punch was no longer a punch, a kick no longer a kick.
Now that I've understood the art, a punch is just like a punch, a kick just like a kick.
The height of cultivation is really nothing special.
It is merely simplicity; the ability to express the utmost with the minimum.
It is the halfway cultivation that leads to ornamentation. (a chart tt looks like Starwars!)

Art is the expression of the self.
The more complicated and restricted the method,
the less the opportunity for expression of one's original sense of freedom.
(too many rigid rules/ 1000 pinbar variations instead of what makes a good location)

 Though they play an important role in the early stage, the techniques should not be too mechanical, complex or restrictive.
If we cling blindly to them, we shall eventually become bound by their limitations.
Remember, you are expressing the techniques and not doing the techniques.
If somebody attacks you, your response is not Technique No.1, Stance No. 2, Section 4, Paragraph 5.

A martial artist (trader) who drills exclusively to a set pattern (overly rigid PA setups) of combat is losing his freedom.
He is actually becoming a slave to a choice pattern and feels that the pattern is the real thing. It leads to stagnation because the way of combat (trading) is never based on personal choice and fancies, but constantly changes from moment to moment, and the disappointed combatant (trader) will soon find out that his 'choice routine' lacks pliability. (mechanical blackbox systems/ too many rules such tt it leads to confusion)

There must be a 'being' instead of a 'doing' in training.
One must be free.
Instead of complexity of form, there should be simplicity of expression."
(development of individual style, preferences, MM, trade mgt, etc)




One Mind, Any Market
  • #44,799
  • Sep 28, 2009 9:59pm Sep 28, 2009 9:59pm
Hey Cy

Yeah - that is a eureka moment.

Western culture - particularly European and North Americans have an ethic that dictates and equates activity as equal to productive work.

Now - what we have to do is *believe* this thing you now know so that you can act on it. It still takes a little time and practice - about six weeks to set a new habit in place.

Quoting Cyrus
Hi Guys, abit behind on the thread. Have been trawling through Fiji's section on the PF & doing a heap of thinking & reflecting.

>snip<

It's really the stuff btw my A+ trades that have kept my account at BE.

Firstly, A grade trades dont happen that often, some get stopped out @ BE, others at an "ok" R:R. Others run to the moon, but not THHAAT often.

Secondly, the < A grade trades are alot more common and often result in 1/2 to full bar losses. These little jack asses eat up the returns from A / A+ trades. (keeel dem allllll ...
I'm pretty much done with all this ...
  • #44,800
  • Sep 28, 2009 10:27pm Sep 28, 2009 10:27pm
How do you develop the discipline to not look at the dollar amount... I have a VERY long history of watching the $ instead of the graph... hence taking minor profits when it was a perfect setups. or going to BE when if I had not been watching the $ it would have run. Any help or ideas?
Dr. C
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