Monday, 30 November 2009

Is this the Edge?

Christopher Columbus showed that the world was not flat and he didn't sail over the edge.

Well, I do have an edge. How do I know? Firstly, my trades are consistently profitable and secondly, what I do works in all liquid markets where I can get the information I need to see the order flow.

Today I am posting some extra charts of non index futures markets, the Euro FX and the Bund. By coincidence, at the present time both these markets work for me with 5 tick range bars.

Why should I care if I'm doing fine with the markets I am trading? Well, I was chatting with Kiki about trading from Australia or from Tokyo (she has a huge interest in everything Japanese). I did trade from Oz for a few months in 2003, when the Hang Seng future was the main tradable market.  Now, there is the Euro FX, Kospi, Nifty and others. Kiki wants to travel and trade. So an edge is an edge is an edge.

Let me note here that if volatility changes substantially, the methodology will not change but I may change from the 5 ticks range and my stop loss and first scale out would then change too. I know the next question is: how do you know that you have the change? The short answer is: when you see the increased volatility has arrived. The longer answer is for another day.

Euro FX Future


Bund Future

Today's trading was uneventful. There was one more trade I could have taken but my wife wanted to go Christmas shopping so..............

Click to enlarge


  1. Electronic Local,

    Were todays trades based more on support/resistance or your momentum MA cross setup that's confirmed by the order flow? The reason I ask is based on your smoothed order flow indicator, your 2nd and 3rd trades didn't seem to be confirmed. Am I missing something?


  2. Thanks for the Euro FX chart and possible trades you might have taken, as it is one of the contracts I trade. I have a question on the volume break down histogram. My understanding is that each bar is net of volume lifted at offer and volume at the bid. Is this correct? Thanks.

  3. Tom,

    it would be great to see how you do your premarket analysis and how you find potential levels based on MP.

    For me, stuck in the novice chapter of Daltons book, it would be also interesting if you use a TPO or volume based MP.


  4. Thank you for the information on the Euro Fx. I am just starting to research that to trade before I go to work in the morning. My way of trading seems to pretty similair to yours.

    Is that CCI based off of Woodies?

  5. Joel, no its not woodies. His CCI and methodology did not work for me or anyone else I have spoken to. I used the CCI since early 1980's when Don Lambert introduced it to CompuTrac, a TA group I belonged to.
    timokrates, I use both volume and TPO to be aware of both POCs.
    Geo, my version of VB is very similar to what you describe.
    Aaron, I take all the information as a whole and am aggresive in my entries. Kiki is at the stage of looking for everything to line up. She has fewer trades but a slightly higher win percentage but lower profit per contract due to later entries.

  6. Thanks. That makes sense. I'm focusing primarily on defining my market bias through MP. I figure if I can get the bias correct, finding good entries shouldn't be too difficult.