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Technical Analysis Fallacy

  • #55,241
  • Aug 17, 2016 8:38am Aug 17, 2016 8:38am
Quoting RelaxRay
Hi Alex I agree with the discussion above IMO the pair was wide ranging with gentle daily and hourly buy momentum, made daily HH HL in early Aug. I was caught on the wrong side of this myself too, due to my poor reading and disorientation, perhaps dancing with male?! Ugh. The reason I went short was the day before, sellers came in hard at 1.12 level with a V reversal with an inside bar daily showing hesitance buyers and eager sellers, and shortly after the next day, I went short. When I look closer(and scaled out when scout was in trouble) and saw...
Hi - I went long at bottom - but I was jittery when the bears kept hitting me - and I get why you thought about shorting. I will not go short generally if my m5 trend is long - but I have tested some stuff with a small scout in the past against trend - probably needs to be more of a climax though when I think about it and I need a few good reasons to do it. I do see double top set ups against trend as traps mostly.

Very Important. (really is Very Important Person - just a term I use)

Did you flip to rescue?
check out the terrain - follow never lead
  • #55,242
  • Aug 17, 2016 8:49am Aug 17, 2016 8:49am
Quoting alexandria
{quote} Hi - I went long at bottom - but I was jittery when the bears kept hitting me - and I get why you thought about shorting. I will not go short generally if my m5 trend is long - but I have tested some stuff with a small scout in the past against trend - probably needs to be more of a climax though when I think about it and I need a few good reasons to do it. I do see double top set ups against trend as traps mostly. Very Important. (really is Very Important Person - just a term I use) Did you flip to rescue?
Noted
No, I didnt flip this one, as soon as I saw her fail at the BRN again, I loaded rescue, my BE was about 15 odd pip.
First trade after a long break, felt like I was a fish out of water. The eyes not seeing details. Maybe need to do some Kim's game like FTI suggested somewhere in thread.

Rgds
Fall in love with the process, and the outcome takes care of itself.
  • #55,243
  • Edited 9:31pm Aug 17, 2016 7:33pm | Edited 9:31pm
is nice see lots discussions among friends.
Sorry i tilt and had to go resort do some adjustments. durian blood sugar 14.7
i chip in some thinking, but do jump in anytime with thoughts.

ok about alex's range.
1stly,To seeing distribution requires some i call no mobile bars.means they going no where , tic tok tic toc. That tic toc has to be tic tocing around a mean(pivot?) for you spot the distribution, right?
If that distance they tic tocing is tight pips(<5 around pivot), then is easier for market makers make pips than traders.Because mostly traders gives away the spread to get in and out of the trades. So is ok if one decides to take a rest until one can detect opportunities.

2ndly,
distribution in no way suggest change of trend. May suggest risk off situation because for whatsoever reason, directional aggression tapers off. And is an opportunity dealers stabalise the run for weak holders to square books.
but it also does not mean that the trend cannot rv.

The best way make pips is to sell top of the tic and buy the toc. But we are not superhuman always as many of you suggested.
The accepted mo in such situations is to continue trade if necessary but not in both tic and toc directions. Unless one has the experience not become disorientated after some spins and run around like a headless chicken.
I would suggest that one chose either trade the tic or the toc not both. Remember the bus? mostly i would stay with previous trend until detected otherwise.
You would know if you are managing either sucessfully by book profits.
if not then just sit on hands.
Also if the range around the pivot is too tight to squeeze any juice from.
Just be generous and find something meaningful to do until the fog clears.
Can't squeeze blood out of stones.

regards
  • #55,244
  • Edited 10:05pm Aug 17, 2016 7:37pm | Edited 10:05pm
Quoting RelaxRay
{quote} Noted No, I didnt flip this one, as soon as I saw her fail at the BRN again, I loaded rescue, my BE was about 15 odd pip. First trade after a long break, felt like I was a fish out of water. The eyes not seeing details. Maybe need to do some Kim's game like FTI suggested somewhere in thread. Rgds
kim's game.

Now you understand the risk of rusty?
.

regards

Steady mind,it should be back soon.
Relax and easy. no rushing Relaxray
  • #55,245
  • Aug 17, 2016 10:05pm Aug 17, 2016 10:05pm
Quoting fti
is nice see lots discussions among friends. Sorry i tilt and had to go resort do some adjustments. durian blood sugar 14.7 i chip in some thinking, but do jump in anytime with thoughts. ok about alex's range. 1stly,To seeing distribution requires some i call no mobile bars.means they going no where , tic tok tic toc. That tic toc has to be tic tocing around a mean(pivot?) for you spot the distribution, right? If that distance they tic tocing is tight pips(<5 around pivot), then is easier for market makers make pips than traders.Because mostly...
take care, friend.
  • #55,246
  • Aug 18, 2016 1:04am Aug 18, 2016 1:04am
Quoting fti
{quote} kim's game. Now you understand the risk of rusty? . regards Steady mind,it should be back soon. Relax and easy. no rushing Relaxray
Take care FTI!
Take it easy on the durian!


Yes, "use it or loss it" just amazed at how quick!

Going start to do some filing for MO, protocol etc.

Much thanks, holding steady.

Rgds
Fall in love with the process, and the outcome takes care of itself.
  • #55,247
  • Aug 18, 2016 3:17am Aug 18, 2016 3:17am
Hi fti

take care my friend.

regards

Phil.
-be careful about what you allow to be put in your mind-
  • #55,248
  • Aug 18, 2016 3:34am Aug 18, 2016 3:34am
Quoting fti
is nice see lots discussions among friends. Sorry i tilt and had to go resort do some adjustments. durian blood sugar 14.7 i chip in some thinking, but do jump in anytime with thoughts. ok about alex's range. 1stly,To seeing distribution requires some i call no mobile bars.means they going no where , tic tok tic toc. That tic toc has to be tic tocing around a mean(pivot?) for you spot the distribution, right? If that distance they tic tocing is tight pips(<5 around pivot), then is easier for market makers make pips than traders.Because mostly...
Alex

FTI needs chillax

Inserted Video
check out the terrain - follow never lead
  • #55,249
  • Aug 18, 2016 4:47pm Aug 18, 2016 4:47pm
Quoting alexandria
{quote} Alex FTI needs chillax https://www.youtube.com/watch?v=v88jHgGAUIU


regards
  • #55,250
  • Aug 18, 2016 5:57pm Aug 18, 2016 5:57pm
cookie,relax,phil

regards
  • #55,251
  • Aug 19, 2016 2:12am Aug 19, 2016 2:12am
Quoting fti
.......2ndly, distribution in no way suggest change of trend. May suggest risk off situation because for whatsoever reason, directional aggression tapers off. And is an opportunity dealers stabalise the run for weak holders to square books..........
Do not wish to bother FTI chillaxing.

Do other peeps understand what he means by dealers "stabilising the run"? Not sure I do.

Alex
check out the terrain - follow never lead
  • #55,252
  • Aug 19, 2016 2:31am Aug 19, 2016 2:31am
Quoting alexandria
{quote} Do not wish to bother FTI chillaxing. Do other peeps understand what he means by dealers "stabilising the run"? Not sure I do. Alex

Hi Alex

If price is going down then the MM’s will be long (they take the other side of a run), when the price ‘rests’ they can try to re-balance their books.

If you look at the COT report you can see this, the ‘commercials’ are on the opposite side to the large and small speculators.

http://cotbase.com/

Regards

Phil.
-be careful about what you allow to be put in your mind-
  • #55,253
  • Edited 4:35am Aug 19, 2016 4:21am | Edited 4:35am
Quoting alexandria
{quote} Do not wish to bother FTI chillaxing. Do other peeps understand what he means by dealers "stabilising the run"? Not sure I do. Alex

My take:
I understand it by price-order balancing. Or, how the market is position and balance.
In short, as there is always orders moving around, if someone needs to buy another is on sell right? When commercial are long, dealer are short. To provide liquidity. Depending on how ferocious/tame the event is, gives birth to the gyration of price movements and activity for the period and price orders.

"2ndly,
distribution in no way suggest change of trend. May suggest risk off situation because for whatsoever reason, directional aggression tapers off. And is an opportunity dealers stabalise the run for weak holders to square books.
but it also does not mean that the trend cannot rv."


To add, lets take the most recent ultra high vola run on the cable.
Tons of sellers came in @ referendum day, resulting in GBP being sold hard. So, market is looking to sell, dealer take opposite side of trade. However, I do not thinking dealer is 100% long too, as they need to protect their books through their strategies and ways. (this part is beyond me, and I believe it is too much info for me to trade with now as I do not have the capital to deploy the maneuver. However, imo it involving delta hedging and those "long sword" that fti talks about)

Hence, the impulse leg down, gives the new bearish sentiment and trend, which also reflect fundamentally change in that BOE is no longer looking to hike their rates, as shown in their recent rate cut and easing measures. Giving a change of economic outlook.

After the initial leg, price been moving sideways, showing a congestion pattern with wide ranging character. Chart is still bearish, however the strong aggressive impulse leg down is easing off, and with not much other known news to shake her violently, this gives the dealers or whoever on the opposite side of the market trade to balance off their books.

Most recent cftc to illustrate
Attached Image (click to enlarge)
Click to Enlarge Name: Screenshot1.png Size: 105 KB

http://www.cftc.gov/dea/options/financial_lof.htm

Some terms to elaborate:

Dealer/Intermediary These participants are what are typically described as the sell side of the market. Though they may not predominately sell futures, they do design and sell various financial assets to clients. They tend to have matched books or offset their risk across markets and clients. Futures contracts are part of the pricing and balancing of risk associated with the products they sell and their activities. These include large banks (U.S. and non-U.S.) and dealers in securities, swaps and other derivatives. The rest of the market comprises the buy-side, which is divided into three separate categories:

Asset Manager/Institutional. These are institutional investors, including pension funds, endowments, insurance companies, mutual funds and those portfolio/investment managers whose clients are predominantly institutional.

Leveraged Funds. These are typically hedge funds and various types of money managers, including registered commodity trading advisors (CTAs); registered commodity pool operators (CPOs) or unregistered funds identified by CFTC.3 The strategies may involve taking outright positions or arbitrage within and across markets. The traders may be engaged in managing and conducting proprietary futures trading and trading on behalf of speculative clients.

Other Reportables Reportable traders that are not placed into one of the first three categories are placed into the other reportables category. The traders in this category mostly are using markets to hedge business risk, whether that risk is related to foreign exchange, equities or interest rates. This category includes corporate treasuries, central banks, smaller banks, mortgage originators, credit unions and any other reportable traders not assigned to the other three categories.

http://www.cftc.gov/idc/groups/publi...atorynotes.pdf


Hope that helps.
If I am mis-guided, please correct and bump me along as well.
Thanks


Rgds


Also, interesting to watch the JPY move.
Been awhile since anything

Also, I was just quoting a very huge example, but logically, it happens non-stop, and that as long as theres movements, theres balancing.
Fall in love with the process, and the outcome takes care of itself.
  • #55,254
  • Aug 19, 2016 7:01am Aug 19, 2016 7:01am
Quoting phil13
{quote} Hi Alex If price is going down then the MMs will be long (they take the other side of a run), when the price rests they can try to re-balance their books. If you look at the COT report you can see this, the commercials are on the opposite side to the large and small speculators. http://cotbase.com/ Regards Phil.
Thanks - yeh I understood from thread earlier that they are on opp sides - guess I did not really understand how they stabilise - but can see now. COT link is great.

Alex
check out the terrain - follow never lead
  • #55,255
  • Edited 8:09am Aug 19, 2016 7:14am | Edited 8:09am
Quoting RelaxRay
{quote} My take: I understand it by price-order balancing. Or, how the market is position and balance. In short, as there is always orders moving around, if someone needs to buy another is on sell right? ....
Thanks so much for info- great link.

Guess it is all about the zero sum game. Market-makers/dealers have access to the orders and must somehow balance out their books on both sides of the trade guess this is what stabilising means. They can also widen spreads to recover more funds from one side of the trade - must be a balancing act to manage trades from those informed peeps versus those not so informed traders who lose - while providing liquidity. If market is very one sided like referendum then they still need to maintain balance. They must be balancing other peeps trades on both sides while managing their own positions (they must have em). Not easy as lots of different types of peeps trading.

Alex
check out the terrain - follow never lead
  • #55,256
  • Edited 9:47am Aug 19, 2016 9:18am | Edited 9:47am
hi, i have an question about how dealers employ the triangular arbitrage relation, i saw the gbpusd trended strongly down today and eurgbp is up strongly. turns out that brexit news hits the market again, so if dealers are forced to long the pound and short the dollar, they move crosses to rotate into long eurusd, so now, they keep making a market in eurusd and scalp out of the synthetic position and we see a eurusd chart which is mainly whipsaws. is this 1 way dealers deal with unexpected scenarios sometimes?

so in this way they re-average into the involved pairs while covering into the 3rd pair.

please correct me if im wrong on this.
  • #55,257
  • Edited 5:30pm Aug 19, 2016 2:45pm | Edited 5:30pm
Ahhh very good questions you asked, Alexandria.
Made me sit think, if i should teach you people about pricing. demand /supply, the squeeze and market making. Its called the matches games/BIG BOYS Bourse Game.

But i have underlying fear that it may affect some traders MO styles. because you are all retail players. Just takes 1 ego , go for the death game, and it can kill many traders, if they not careful.
I need think very deep , if i should embark on a project of this magnitude for retail trading. This is actually good for market makers and senior dealers training.
Only plus i can think of is it can change tons of people's mindset about pricing.
Will this be a good thing or will it push small traders think like BIG BOYs.
IT can get em killed , if not careful.

i take some time think.please.
regards


But if i no start this project one can learn same from watching this.
And how it killed a good trader.
The fraud account,used, i no like.
But his strangle butterfly strategies, on recovery of error position, is tier 1 mindset.
The means where/how it was employed. I detested. Fraudulently used. Criminal mindset.
"when a right tool is used by wrong man, it works in wrong way."................Confusing. Confucious.

Moreover if i do this i will need 2 play role as market maker and 2 as customer.
In actual training , 7 by 7 dealers/players are used in my senior dealer classes.

I need think very deep.
Take some time. maybe.

meanwhile, the lesson is available here , for those who thinks deep.
Inserted Video
  • #55,258
  • Edited 5:29pm Aug 19, 2016 2:56pm | Edited 5:29pm
Quoting CookieMonsta
hi, i have an question about how dealers employ the triangular arbitrage relation, i saw the gbpusd trended strongly down today and eurgbp is up strongly. turns out that brexit news hits the market again, so if dealers are forced to long the pound and short the dollar, they move crosses to rotate into long eurusd, so now, they keep making a market in eurusd and scalp out of the synthetic position and we see a eurusd chart which is mainly whipsaws. is this 1 way dealers deal with unexpected scenarios sometimes? so in this way they re-average into...
after so many years i explaining , you still cannot understand romance 3 kingdoms.
They didn't long cable short the dolar.
They jusrt shifted their portfolio from holding USD to cable only la.In other words they holding cable for usd la.
Shifted their holdings from usd to cable. kapish?
romance 3 kingdoms you just put BIG name call it "triangular arbitrage relation". BIg words will get you high places?
careful,
watch the YOU hor.
Call it 3some?

regards

reinventing the wheel with another wheel?, it don't get points in my book. Get demerit points hor.
A rose by any other name is still a ROSE.

anyway, you are not top dog dealer. So its forgiven.
AND my ugly arrogance is showing. A ya, moody.
more chilling requires.
Its very difficult, so much pain.

Anyway, Big Boys shifts stance can drive over extended position's heads between the rock and very hard places. Believe?rigidity?
double edge swords.
  • #55,259
  • Edited 5:08pm Aug 19, 2016 4:42pm | Edited 5:08pm
Thanks fti for mindset lessons also wery accurate, trying to reset to basic
  • #55,260
  • Edited 5:29pm Aug 19, 2016 5:14pm | Edited 5:29pm
If you willing to share, how you comply the mindset when you were the top guy? And from there onwards... to make clear im no were near top of anythin, just want to know, such difficult task..
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