Crude, in the zone 2
Learning in real time
Swimming with whales
A deepening understanding of Fractals
Lightbulbs and gradually sudden enlightenment
Highest density of epiphanies during any single trade so far
And the bodhisattva vow
Today was easy. I got my blog entry done during the trade, by filling Facebook chat with live commentary. Now I’m done early! All I have to do is paste in all the snap shots of the action.
Brendan got something done too, work on his shed, while I jabbered at him. So, valuable day all round! (He had already doubled in acct in one night on Monday, so he was taking the prescribed big win break.)
Whether or not anyone reads this, or if it benefits anyone, I myself feel quite edified. I have never been so “in the zone.” Good practice session. Good workout.
I felt like I understood many new things, or old things on a deeper level, all in real time. So, good show, blog done.
If anyone does read this, I urge muddling through the early confusion, or skipping ahead to 7:47AM, when the light bulbs started to flicker.
IMO, there be nuggets in dem der epiphanies, that might be exchanged at the tradin station for some gubburnment notes…(at least for me, and hopefully friends, family, and in the long run…we’re all friends, right?)
I’ll go through the text and try to add notes where jargon or shorthand is used. FT71 has a glossary for many of these terms, at:
Pictures start flowing in chat at 8:58 AM, so scroll forward for visual references.
If you can’t stand trading, but like spiritual claptrap and crazy talk, scroll forward to 11am, when the trade was winding up. Supercalifragilisticexpialidocious
for the commonly experienced disgust with the taste of trading! Or is that a spoon full of sugar?
(There are a lot of famous trading exercises. One is narrating the market. Out loud. One thing it might do is give one insight in to ones own way of thinking….thoughts which might be sub-conscious if not articulated. Thoughts which in some cases can cause us to make wrong choices.)
Before the chat started, I spent the time from 6am to 7am dipping my toe in the water with some early trades. I got short on a failure back in to yesterday’s range, and got one scale out. Then price stalled. I took a snap shot of what looked like a bear flag, because it was an upside down mirror image of how the market ended yesterday.
The slight poke through a level, the curling away from that level on the second attempt. Yesterday, in the long run, this did become a bull flag that completed up. Would this one be a bear flag that completed down? You can see my targets in the blue lines below, where I wanted to cover my short, and reverse my position. The reason was, this level was 50% of the entire up move from yesterday. The day that was driven by the big 24,000 contract buyer.
It never got there, and my early gains were whittled away, and I never got my long on from $40.32. Here is what happened next, from 6:30-8 am PST.
The chat log begins at 7:20 am. That is right about the time you can see I added to my short (the little purple dot), at half of the down move, expecting the bear flag to continue, to the point where I wanted to get long, at $40.30.
Then at 7:30, you can see where I realized I was wrong, and stopped out. A little slow there. Bad trader! Hand slapped. A few hundred bucks up in smoke. Should have seen it when it pushed through that liquidity directly above my short add, at $41.77.
As the Facebook chat log proceeds, an idea dawns. That idea is reflected in the picture above of the blue dots around 7:45, where I started to get long.
The rest is history.
Facebook Chat Log
That little push by the Asians should have been a little more suspect to me.
I’m back to playing paper
reads harder for me today
out of yd range, back in, got some good short scales
but didn’t reach target of 50% of upmove
impulsive back out of yd range, back in
ES and NQ acting similar
NQ getting very bullish
was up quite a bit at times, now back to flattish
back through 50% of that up impulse
think I’ll give it a rest, and see if anything clearer forms
I shorted the second failure back in to range, which worked….but with NQ and ES holding above their yd ranges…
took it off early
Yeah I’ve got the day off but have to finish the shed project and not hitting my targets.little off
Big build here as you thought
what could be happening here is
that 24k buyer from yd
could be pushing through local levels
not letting it get back to technical pull backs, buying it up
day is a massive bull flag now
I’ll try a long
might get chopped
but I think that big guy is still in control
I don’t like it in the middle here
But looks like it wants higher
but I have a theory
let’s see how it works out
also ES and NQ ripping
Gotta play fhem
bigger time frame idea
it’s already pushed above yd range twice
it’s exactly at that choppy close from yd
not respecting mids at all today
somehow or other, I think we’re gonna get out of yd range and close above it
it’s an interesting situation, because in this case we specifically saw this one big buyer
I was just thinking about the 25K guy coming into the bear cave, he has work to do
we know he was there
all we have to do is guess his time frame, and potential size
usually we are guessing more about big players
We see them in the action, and the volume
but we don’t know it was one guy
NQ trending up
Definitely could have been a group
I think it’s one guy
It looks like it wants higher
just think about it
let’s say you have a $100m fund
you could easily do that
and that’s not that much
here he comes
poised right at that close
ES above poc (volume point of control) of 13 day range
HUM behaving trippy
it’s become my pet stock
NQ straight up
one of the things I’m meaning to write as part of my training series is
what is happening inside a flag
I’ve thought about the participants
and of course it happens on various time frames
I think I’ve figured out what plugin can make the web page behave the way I have in mind, but it’s hard to get the time to do it
here we go
locals (smaller time frame traders) shorting here
more locals shorting
did you ever hear that famous story about a technician trying to call a level to a seasoned commodity trader? *(footnoted)
sucking in more shorts
I predict trend day 2
I was waiting to say that J 🙂
I added long 2 seconds before the pop
Thumbs up (emoticon didn’t copy from FB)
aiming for a scale at on (overnight) high
you can just imagine how many locals get smoked by this type of action
I did many times in the past
with ES and NQ you can’t really imagine this is one guy….but in oil it might be
or, like you say, a small group of large players that collude
one guy could initiate it
I wonder what the legal issues are around this
looks toppy and more shorts piling on
Sorry Charlie…another pregnant line
and again, the shorts at on high
I should have been playing this with real money
but at least it’s got my practice acct near the live trigger target I’ve been shooting for since April
I would be live already, if I hadn’t made mistakes, and had set backs and draw downs
I am live sometimes, just not today
anyway, I got that scale
note how it didn’t even get back to 50% of yd up move
that is how it behaved all the way up from the bottom (since February 2016)
And in Bookmap, you can see (in yesterday’s blog entry) that this big buyer stepped in at $39.60 and started buying, 40 cents above the 61.8% technical fib level
It just took enormous size to stem the bleed
My commentary is my journal entry for today.
Killing two birds with one stone.
Just have to add the snap shots
The log is like the light bulb going off for me about what is happening
and on the topic of what is happening, more speculation on players of that size
on one hand, a single guy with a $100 m acct could push around 20k contracts without even using leverage (other than the leverage of futures contracts themselves.)
There are a lot of accts that size.
One guy could be much bigger than that.
A small group could collude, and push the market around even more.
On the other hand, these guys are also like giants locals.
A clash of the titans.
BECAUSE there are a lot of people with money on that scale.
So while their action may push through local technical levels, and rip up day charts, they would be looking at larger time frame technical levels. In fact, they would have CREATED those levels by their actions.
So that’s how you get the larger fractals that turn smaller sets of levels in to noise, chaos.
HUM, interesting failure in my pet stock
big tail, green to red, back through yd close
all following positive earnings report yd, on which the stock did nearly nothing….but is right in the middle of a seeming bull flag….a bull flag within a bull flag….more speculation on that elsewhere
So now oil has moved a buck
it has technically completed yd move
it has doubled this morn range
In theory it could be done
but on a larger time frame, this range could be a version of a bull flag…that just looks different
The first impulse on that time frame went from $39.19 to $40.40….$2.20
the base of this range is $40.43
Is there anything interesting at around $42.60?
42.70 ish was all those spring opens and closes
A burst through the breakout level of $41.83 will trigger a lot of stops
At that point, the big guys can just sail with the wind they created
snap shot of all the stops and sell orders at 41.83
ES sliding up the upside of the 2 week volume mountain
Everything sucking up
snap shot of a short squeeze
Now I see that what looks like grinding through sell orders on a trend day is actually a short squeeze
now it will probably pause here and go sideways
and bull flag
maybe for an hour or more
Would that twer always so clear
I guess this is how you felt that night you rode the short trend all night and made a fortune
Except today, I missed it, and Tues but yes it felt good but also a lot to take in
Well, you had a big bet on the line
I’m just absorbing how the phenomena is created.
You nailed today
And making my journal entry in the process 🙂
Should have jumped on
I should be making real money instead of fake….but mental capital is nothing to sneeze at
here’s a tiny wash out
some of those sells around $41.83 would have been stops and some actual sellers
But it topped at $41.96
So anywhere down to $41.66 is noise, one standard deviation
And actually, on a day like today, the volatility in increased
so the standard wave size is different
If it holds above $41.66 it’s very tight
but could even wash lower without breaking the up trend
Lotsa light bulbs going on for me today
Also this is a realization of what mid really means
It’s the bottom of an enlarged standard wave size
on increased volatility
so mid is way back at $41.24
which would be a long if it got there, but it probably won’t
- cool, found out I could copy our conversation from here to word
It even has our little FB icons. I wonder if those are hyper-links that will copy in to my Word Press blog.
Less than .30c pullback still
.29c, looking flaggy
Bounced at a perfect spot
we’ve seen that often during this time slice on a trend day
Little break and shake
Did I just coin the phrase?
text book bull flag snap shot
trading does lend itself to slang design
metaphors and idea fractals that become little nuggets of knowledge
I think it’s because when we are looking THROUGH charts, we are actually seeing human behavior
the actual push and pull of competition in action
which is the root of evolution
nature in action
If you can read the break, you could sell and rebuy
Collect .30c more on the run
you think it will pull back here?
oh, you mean try to scalp this noise, and improve position?
It went through .83-4 last time
But don’t take the short
Then you’ve taken nice profit
I’m pretty slow witted for that….just happy to have a few ideas forging new neural circuits…
hoping I can use these ideas in real life for years to come
Break almost over
If this is what is happening
it’s back to that psychological level of $41.83
looks like the bull flag is breaking up, but may not, due to that level
We’ve only been consolidating 45 minutes so far
Bigger players might be taking lunch
It’s the noon hour on the East coast
funny how it seems like voodoo, until it doesn’t
“superstition: when you believe in things you don’t understand.” Isn’t that the Stevie Wonder line?
HUM noisy, red to green again
Lunch is almost over
The funky thing going on there is the combination of improving earnings, and the Aetna merger, and the DOJ trying to block that
9 more minutes
haha, you think it’s that precise?
It will start a few before haha
Ok Filbert, drink up, I already paid the check
not sure whales are usually named Filbert
probably betraying my small fry ness
yup, lunch is over, time to get back to the arduous task of poking buttons
screaming in a pit in the olden days
in old stories, commodity traders, like the Turtle trader guy, and Jesse Livermore, could do breakout trades, and ride trends, because they were in the pit, and they could HEAR the screaming
Off by a couple minutes 😆😆😆😆😆
BUY BUY BUY
It was easy in a way
Then you couldn’t do that as well when things became more electronic
For years prop traders traded off ladders showing the orders going through (just flashing #s…no charts…no visual reference.)
they had to make a mental map of the levels where pace picked up, and they sensed the excitement
Morad says that now we’ve entered a new era, with Bookmap. Because now you can SEE the order book history. And the excitement of buys in the yellow dots, and sells in the red ones
Now we have a potential failure
I’m reducing here
can always add back if it resumes
see how it pushed through the liquidity and fell back in?
that is the anatomy of a tail
that is actually a short on retest of 42
moved the mid up to $41.29
If it bursts up through $42 now, the uptrend likely resumes
if it taps it, and falls, we likely get an impulse down
In this little local range, we go back to the idea of a standard deviation being 30 cents
So that gives us, below $41.77 defines a down impulse, and breaks the up trend for now
Liquidity filled in at $41.90 (holding price down, reinforcing the short idea.)
Those were real local sellers
still, “should” retest 42 before falling
Today but if it’s moving higher, it wil probably fly
this is my new idea of reading a flag vs failure
Tails left in the dust
through $41.77 and I’m out of the long for now
at $42 I’d also take it off
I suspect we fail here
Above $42 and the long is back on
But you can’t deny who showed up
They want confusion
They eat weak ones
yes, but technically speaking, their original move from YD is already complete
and even though an equal size move takes us to $42.60
- it might not do it all in one go
- sometimes the second wave is smaller
Do the locals f up the technical aspects, who knows
I think the auction sometimes gets local in the midst of a bigger move
I have to have reasons for my actions
So I’ve defined the plan
We took care of that high .60 area, now working on the psychological level
now I have nothing to do other than act on it
I would try a mid long if we get back there
Trying to get some conviction here
zooming out to see if that 50% level ($42.29) corresponds to historical levels
Often I try to see if a top makes sense, because it sets up a mid at some level that makes sense
megaphone, reversal pattern
zooming out further to see why it might fail here
I think it will, just looking arced too
yeah, NQ and ES saggy
ES back below POC of 2 week range
but still not sub 500
through the .77 by 2 cents
still might try to test 42 again, but failure is confirmed to me
trying to squeeze another 20 cents out of my last position
you can see how it poked through that 77 level, see the local buyers were there
of course, the bigger time frame guys could negate all this
But I’m happy to get out there, on a retest of 42
if it burst through, then it’s possibly a break out trade
but now it has that megaphone phenomena going against it
Morad’s webinar on NQ currently going
As an S5 member you have access to those…they only keep them up for 2 weeks
these days he periodically trades a replay day, and explains what to look for
they do the replay not because he knows what happened, but because trading in real time is so slow
you’d get like a 4 hour webinar, or more
so they speed up the play back
It’s similar to what we’re doing here, real time commentary
Except of course that he has 16 years of success behind him, whereas I’m “getting” stuff for the first time as it happens
I mean, of course, to some degree I knew this stuff before
and before that, and before that
A remember the question: “Rinpoche, is enlightenment gradual or sudden?”
“Sometimes it’s suddenly gradual, and sometimes it’s gradually sudden.”
if it does’t retest 42 now, but falls first, that’s interesting
It “should” retest that level
so if it falls first, we might think it’s more likely for the long continuation from the mid
but we have to also consider the time of day
it’s getting late
maybe too late for a pullback to mid and then continuation
I still think the retest of 42 is more likely now
it’s gone to sleep
This could easily be like yd top
where it just gets noisy up here, forms a closing range
then of course, yd the Asians completed it up, even though the pattern wasn’t pretty
541 suddenly appeared as sellers at $41.82
real sellers or algo?
they are sticking there
here comes the 42 retest
more sellers appearing
334 at $41.92
they are really selling
possibly an algo
you could probably code this
if this then this
It failed through that liquidity at $42, and fell more than 30 cents
unlikely to continue at close
noise at least likely
Am I selling you on Bookmap?
Working on the shed, bookmap looks awesome
got my 20 extra cents
Bookmap is good for those of us who would rather stare at a picture than flashing #s
I wonder how many prop traders had epileptic seizures
didn’t quite retest 42
might not have gotten filled in real life. Should have been 1 cent lower
still, might retest again, or even break through
But even if it breaks through, now I expect a close more like yd, where it gets noisy
I’ll come back later and see how that worked out
Probably shut down at .84
Maybe move down a little on
Oh you just said that
More free time for philosophical reverie
vis a vis the real vs simulated acct
and real life v simulation
self made rules for what allows “realization”
You either get the big day on that push or the timeframe ends
did you hear that Elon Musk said “reality is almost certainly a simulation.” Like VR running on some kind of cosmic computer.
His line of thought is very easy for someone like me to follow (or lead.)
It’s interesting in light of the term “realization,” that is used sometimes almost synonymously with “enlightenment”
to become aware of what is “real” or to become “real”
as a sort of event
and sometimes you get real for a little while, and run in to a brick wall, or get crushed…and then retreat back in to simulation
Practice some more (why is meditation called “practice”?)
Who set the rules for when we are allowed to go live? Is it us, or “the higher self?”
are we following the rules, or defying ourselves, or whoever
the weirdness of the nature of “self”
this is all obviously implicit in this oil trade J 🙂
I guess Zukerburg “owns” this blog entry, since I’m doing it in FB chat
Angelina told me I should just put out teasers of the stuff I write, because people can copy it
she is such a sweet person….her name is apropos
To think that stuff I write would get noticed in the sea of noise of the web
She reads it, or some of it. That is more than enough.
I’ve been talking to myself all my life. I’m easily “self-entertained.”
Anyway, hopefully all this work leads to live profitable trading. Ramping up in size. Generating a lot of profit. Which hopefully leads to the “social hedge fund” idea getting realized
Have you heard the comment, “trading is the hardest easy money in the world?”
Something like that. I think Jack Schwagger (writer of Market Wizards books) said somewhere that traders were work a holics
I’m going on 2 years of practice now. 1 year of this full time, methodical, daily routine.
And only last April did I start to go in the right direction. Up to then I lost real money, then 70% of my simulated account.
Since then I’ve more than doubled it, allowing for big hiccups, spasms of stupidity, where I would have 10-15% draw downs. But before April, the draw-downs out-weighed the profits, since then vice versa.
In college, I used to take acid, and talk in to a tape recorder. (I don’t think I ever listened all the way through one of those tapes afterwards. Probably comes across like gibberish.)
But one thing I remember saying, sitting in Will Penna’s cottage that I rented, was something like, “I have no idea how I will ever make money, unless someone pays me for saying words like this.”
Well, that never happened. Or did it? Maybe it’s happening now. Or about to happen. I can certainly see how it can lead there now. So I’ve gotten somewhere since college. I’m the one that’s gonna pay me for saying these words!
Another thing I recollect, putting the pieces together, reconstructing my life, was making the “bodhisattva vow.”
I was totally sincere. But I made up my own version of it. I said it to God, no human intermediary.
My version was, “I vow to do the greatest good. Please guide me through whatever I need to go through in order to achieve that.”
which was, and is, a scary thought.
Years later, when I got sciatica vigorously doing hatha yoga, I remembered my vow. “Well, I guess it wasn’t yoga I’m supposed to be doing.”
I mean, it’s not that I wasn’t willing to fight through the pain. It was something deeper than that. I wasn’t giving up. It was made totally clear to me that my body was not meant for that.
5 minutes to close.
Here we are, dead center, just like YD
If we close like this, will the Asians take it up after market, like YD?
or will the closers do it now? (which I predict they won’t)
620 (sellers) lined up all day for sale at 42, ever since it failed through there
And, dead in to close. Dead center, like YD
*footnote from comment above:
There is a famous story where a technical trader was brought in to a prop shop, and assigned to an old hand commodity trader.
They are watching soybeans, I think it was.
The technical trader says, “Price will turn around right here?”
The gnarly old commodity trader says, “Are you sure?”
The technical trader says, “Absolutely, guaranteed.”
The commodity trader picks up the phone, and, just to make a point, says, “Sell 100 contracts of soybeans.”
Price plummets through the technical level.