Thursday, 4 March 2010

Shhhhhhhh Quiet!

Quietness ahead of Friday's numbers continues. There are great expectations for the numbers so I'm sure we'll be disappointed or surprised. I think this is a number not to trade through for Kiki and me. It has been said that the purpose of the market is to do as much damage as quickly as possible to the most traders. I don't know if I agree with that, but a look at all our trading plans on what to do in these circumstances is certainly worthwhile. There's an expression in the UK: "belts and braces" or "belts and suspenders" if you speak American English. Take double care is the translation. I am.

Trade 1 was one I'm not sure I would have taken without being able to look inside the bar with MarketDelta. These drifting markets can fake me out easily.

Trade 2 was a trade I would normally have taken 2 bars before. Belts and braces.

It was just a hit and run with taking full profits at what is usually the first scale.

You may see variations in my settings on charts. I fiddle with them while I trade to get another view and sometimes I don't set them back when I take the screenshot. The original settings are what I use to trade but have a closer look with lower settings from time to time.

Click to enlarge


  1. How do you decide to modify the values of your keltner channels based on reduced volatility?

  2. What other news announcements do you consider big enough not to trade thru? .... Maybe should be listed under your trading rules section.

    You stated to Boris,that you consistently trade through all but the biggest numbers and from your above post....tomorrows news is one of those announcements you will wait and see and not trade thru. I have missed a lot of trades that you have taken based on the simple fact that a news announcement has just come out or about to. I have been burned so many times by quick moves and reversals that I am gun shy. As you say most damage to most people. Yet it seems to me you have not taken a single loss on any news anouncement you have traded into and many of those were considered by bloomberg's site as highly volatile. So I guess you have to conclude that your trading set ups are giving you enough information before the news that the news becomes irrelavent. Is this the reason you trade thru most news situations?

    Do you think the market has changed from a few years ago when every news announcement was so whippy and 8 to 12 ticks in either direction was very common with stops taken out both ways.

  3. Is there a thread on traders lab discussing this? If not is there any interest in starting one?
    I'm thinking of one for the followers of this blog. Would not expect EL to be involved. An occaisional observation would always be appreciated but he has done enough.

  4. Hi EL,

    Thank You for your time and effort in help us.

    I have read in your blog that you do back testing back to 20 or 10 years. Where do you get the tick data, bid/ask traded volume to generate market delta indictor for each range bar? i have contacted some vendors they told they can provide histrocial daily/minitue data but not tick data and bid/ask volume. (data access can provide provide upto 30 days of tic data). I appreciate your time.

  5. I would like to discuss EL trading. I have a TS and am trading real time. Last few weeks - months was so slow, I started looking into the short term trading...EL seems to be successful, but it is very difficult to understand what he is doing...perhaps we can all combine knowledge and share EL techniques outside of EL...also, at ths point I am not sure why he started to post his trades...he is not reveiling much...

  6. I don't understand that first trade. The market did nothing after the entry except sit in a lull for almost 2 hours. Additionally this trade was taken into a report with no edge. May I ask why you didn't cut this trade short @ break even? I just don't see the logic on this one, perhaps it was because you were sitting above the Globex POC, but there isn't much of an edge (if any) aside from that.

  7. El,

    What did you see inside the bar to initiate Trade 1? I noticed the second tick from the bar high has highest volume. Thanks

  8. Hi Tom,

    could you explain what you saw on the volume profile before you entered the first trade. Was it the sell volume on the bottom of the bar previous to the break of the EMA and the lack of follow through or was it the buying on the bar breaking the EMA?


  9. Hi yes in trader laboratory is thread about EL trades but nobody interest about it. Thread is in Market profile section.starter is Karinka

  10. Hi EL
    please it is problem for you exactly explain one or two setup for entry with all nuances ,basic rules that you follow when exit trade and basic rules concern of context Market profile. Clearly,shortly in one or two posts. OK exit maybe is art but entry is possible programing by Kiki.It is not mentoring.dont be afraid people will not get rich ,everybody must done job with backtest and get confidence . When you started this blog and show willingness,you could help to people this clear and exact way.Simply your exact ideas and reasons before entry ,before exit and concerned context of MP. Same way as you explained to Kiki.
    Thank you

  11. Anon 17:16, I don't modify the Keltner, it should always be 30/3.
    Anon 18:10, news is hard to evaluate. Tomorrow's is may be a non no. If its a problem for you, don't trade through them. There are plenty of other trades. Wait for a pullback if its a new trend.
    Chuck, I have about 2 years of data to test against. That's plenty.
    driven, I think you are missing something if you think everything is not here in the blog. But of course you need to do the work to make it yours.
    Anon 23:55, I didn't cut because nothing changed. Market was dead and drifted in my favour because of the order flow.
    timokrates, "he buying on the bar breaking the EMA"
    Anon 10:24, it's all here in the blog. Without each trader doing his own work defining his trading plan, a discretionary methodology won't work.

  12. EL
    thank for answer,I read all posts in blog and maybe you are talked about one entry setup,but generally and no exactly with nuances. You did not talk about rules of exit ,and context of MP you mentioned just generally. OK you said that everything is in blog,please put this posts to key posts section.Maybe I miss this posts but I sure I read every posts.I think a lot people asked you about your rules but you never answer or just too generally. Of course is not your obligation,but why you started write your trades here in public blog ???? I thought that you want help to people but I am not sure now...sorry if I am wrong

  13. Here is thread about EL trades but nobody interest.

  14. Thanks a lot, Tom.

    In terms of setups - and creating or defining ones own plan I believe you are absolutely right, no question about it. This work has to be done - and I'm also in the middle of it.

    The difficulties I and maybe others are facing are that you show a variety of trades based on setups which differ slightly. Taking into account that no trade is the same on the other hand it has to be kind of mechanical to be backtestable. And then again the setup has to be "soft" enough to trade in a discretionary way. I believe these nuances create the headaches - at least for me...