I’m at home right now waiting on a new mattress to be delivered. My old one is worn out, if you know what I mean. Anyway, I opened my trading platform and took this quick trade, almost immediately:
You can see that the volume splitter wasn’t really splitting much yet, as it only fully operates in real-time. But, the magenta line is still quite usable even in this form, in terms of which direction it is going. So, I noted the bearish divergence in the double top just prior to entry. I noticed that the paintbars had turned color and weren’t green anymore. I noticed that the big traders were net sellers. I got in.
Now, I’ll remind you again that the indicator had not built up enough history to trust the dot sizes, but I definitely got directional confirmation. The large (magenta) traders pushed down, and the market fell with them. I picked an exit around Alla’s Average (the yellow dotted line) when the large traders stepped aside. This is marked on the chart.
As it happened, there was a small fake-out push that knocked price down another point before it reversed, but I am happy with my exit. The odds were fading that the price would drop much more, and I only play when the odds are strong in my favor. That’s what works for me.
Ok, back to my day off…
July 29th, 2008 at 3:58 pm
Richard, what platform do you suggest for the EOT Elite subscribers….given that I would like to dabble in coding as well.
Nice trade BTW!!
July 29th, 2008 at 4:05 pm
If you are already on Tradestation as a broker and like them, then I don’t see much reason to switch away from it. The main thing you miss is range bars. But, if you have another broker already, and your datafeed can feed multicharts, then multicharts is the nicer charting platform. It has more features.
TS and MC are the two supported platforms as of today. Soon, we will be on ninja as well. But, if you are wanting to dabble in programming, I’d still suggest TS or MC. They use easylanguage for their extension language, and it’s… well, easy.
July 29th, 2008 at 4:12 pm
Richard - why didn’t you take the 2nd red entry. Net selling from small, med and large traders with red money bar and price is below Alla’s Average.
July 29th, 2008 at 4:21 pm
Hey Riley. A few reasons, some better than others. The main thing missing is a pullback of some sort. I like to see price trend against alla’s average. As you can see here, often the first push through Alla’s average doesn’t stick.
Also, the big traders had been stepping aside (which is why I exited my short trade). But, price didn’t pull back to “recharge” the market for another push down. So, even though they were net sellers at the time of the second signal, there was less of an imbalance than there had been just a few bars ago. Compare that to the short signal that I _did_ take, and you can see the difference I think.
And, less importantly, I generally don’t get short 5 seconds after exiting a short trade. I have post-trade euphoria, and I mainly want to roll over and take a nap.
July 29th, 2008 at 6:55 pm
Step 1: Take a Nap.
Step 2: ???
Step 3: Profit!
:) Good thing I like naps.
E.
July 29th, 2008 at 7:29 pm
Well, you have to take the winning trade first, so that you deserve the nap!