Sunday, October 07, 2007

Live or Die by your data feed.....

During the workshop we talked about a trend day and LBR ideas....about if the market opened at one end of the range (20%) and closed at the other end of the range that day and then if the $tick closed above 400...that there was an 87% chance the market would trade higher the next day....yada yada yada.

I have had a couple comments about the ticks not closing above 400 but at a lower number....which brings up another problem. I have posted the chart of the $ticks on Monday with a circle at the close and if you look over to the left you can see the value. The problem is, your data provider, your internet connection, your computer and all the crap you have loaded up on Hotcomm or other chat rooms and so on. I can only trade with what I see on my charts at the time I see them and can't run around the neighborhood seeing if everyone else has the same data.

The comment said, that after checking back.....and I went....WOW, someone is actually going and doing a back study of an idea to see if there is something there for them to use.......I mean WOW. That was one of the theme of the workshop and people are already wearing out pencils drawing lines and making notes. This is GREAT.
Keep up the good work, because you are just this close to your own secret sauce....:)


Anonymous said...

I agree Dennis. Your data provider must be different than mine. All I know is that with eSignal, the $TICK is a passthrough symbol that is not calculated by them. It's provided by the NYSE. So, your data provider must be doing their own calculation; otherwise, all of our $TICK readings would match perfectly.

So far, I've only looked at the current year with your claim and have not gone down to the low-level chart pricing (price ticks) to see what exactly could be made on each trade trigger. But from a cursory glance, you only get a couple more hits (24 instead of 20 from my scan) and the $tick did not have any significant bearing on the results.

I'll go back 2 more years and see what that yields. I suspect that all that is really important in this trade setup is taking the trend day definition, in and of itself, and use that to make a decision.

When the $tick finishes on a large positive extreme, that doesn't bode well for the next day's (initial) opening having good followthrough (i.e., it's often faded on the next day's open).

I would have loved to have attended your workshop, but it was too close to our house closing (the one where your windows cost almost as much as our mortgage).

[Like I've always said in your blog, regardless of what I have to say, you're the one with the moutain mansion and I'm not so you're the teacher and I'm the student.]

Anonymous said...

[first poster]

Okay, NOW I'm really confused. I just downloaded the $TICK historical data from eSignal for 10/01/07 at the end of the day and it's DIFFERENT than my original post readings!

[date,time,$tick reading]

Clearly, the TICK is as you said Dennis.

This is all quibbling over nothing though, imho. One thing I've learned about in backtesting is not to get overally anal about near misses. If it's as high a percentage trade setup as you said, whether the $tick is 300 or 440, it's not going to make a significant impact on the results.

After all, I can point to 100's of losers in the futures markets who followed some 14 period CCI period 'rules' to a tee. For so many people to study and follow something so strictly and have maybe 2 or 3 "succeed" (IF you can even find THEM), it's not telling you that the majority following it are stupid. It's telling you that the entire basis upon which they judge to enter a trade IS the stupid part.

Anonymous said...

One last comment about the trading seminar (that I missed). All of you who went should do something very important. If you're not congregating in some place (i.e., chat room), to compare and support each other's findings from your OWN research based on Dennis's methods, then you're better off ALONE, trying to trade it.

Until you're successful at this game, sticking around chat rooms predominantly full of losers looking for a clue (I know, harsh comment but it's true) is a sure way for you to lose focus on what you're trying to do in the first place.

Your mind will be much clearer in trading with just you and your charts. You take full credit for your successes and failures and that's what will make you mature more quickly as a good trader.

Frankly, I never met anyone who was a successful market operator who just sat around in chat rooms, taking other people's advice.