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thanks for your post. Would sign what you wrote wíthout hesitation. You are absolutely right about what drives price. I also believe that the big guys look at floor pivots and fibonacci lines. Gathering points to take the bus together. Nothing sicentific or magic, just self-fulfilling prohecy, as you said. It works, because it is used, and it is used because it works.
I tend to agree with you in theory and generally speaking, but I don't agree that Market profile is lagging. Market profile is NOT an indicator, but a display of information. It shows where the activity took place in terms of time spent at a price level or zone and in terms of volume. Because it is based on price, time and volume I would say it has more validity than daily or weekly pivots based on a formula of the high low and close of prior bars. With that said, yes, the powers that be may very well be using current and prior pivots as stopping points and not MP or indicators.
As far as reading tape goes, I have heard that it is a skill that can take years to master and is not just a matter of looking at how much red or green appears on the time and sales. If I am wrong about that please let me know.
Lastly, please post some charts of what you are describing so that we can learn from it. You can even start a thread if you like.
If the big guys have so much ammunition to do what they want where they want and when they want, and don't need any indicators then why would they bother with fib levels.? Wouldn't they be the ones creating the levels?
Looking forward to continuing this conversation with you guys tomorrow. Real quick though: David_R, I don't know much about MP, I should not have included that in my post as a lagging indicator, however I can almost promise that it isn't as valuable as you think, i say this with all due respect and do not intent to offend.
Fat Tails: How the Fibonacci's sequence exists in the natural workings of life is astounding to me. 1,1,3,5,8..... freakin' amazing stuff I know. However I will touch on my thoughts related to Fib levels tomorrow as they are hit and miss IMHO and not as strong as "volume at level." I'll also show you how a Fib may have played a role at the mid-day highs of yesterday's session. But it was in confluence with another prior day weekly pivot.
I gotta fly and shoulda walked out my front door 10 minutes ago. So I'll post back tomorrow morning and look forward to continuing this discussion.
If there are accepted as gathering points, these levels can work. If the big guys decide to ignore them, the levels will be meaningless. So I use these levels supposing that they are used by others.
This approach may work for one instrument and not for another depending on what fads are followed by the population of traders. It ain't no science, just a n-person game.
This does in no way invalidate market profile analysis. If you look for a point of control, it is just a more sophisticated version of a floor pivot. I am just not ready to use market profile in my trading approach, as I do not yet master it.
David_R thanks for your continuing comments on this thread. I've really enjoyed the approach and discovery. Are you still utilizing OFA's software with CL or any other instrument's?
I don't mean to interrupt DCB, but i wanted to give my take on what transpired and see what DCB says. I also find it much easier to perform this type of analysis after the fact then live.
I'm not currently using the OFA software with CL. From what I've heard it really works best with higher volume markets such as the ES. I know that they say it can be used in other markets, but I don't think CL is one of them.
I may take a look at OFA again with the stock indexes, specifically ES to see what kind of indications I get with it when I have a setup. I think if order flow is confirming the setup then that can add to the strength of the trade setup. I don't know if YM is thick enough for the OFA software.