Video on How to Read the Time and Sales

A live trade setup from the chat room today showing what the time and sales should look like on a breakout trade for the Dow emini futures (YM).

Video on How to Read the Time and Sales

A live trade setup from the chat room today showing what the time and sales should look like on a breakout trade for the Dow emini futures (YM).

QuoteTracker to ZeroLine Trader Automated Trade System

I have written a perl script which enables you to make automated trades based off of signals generated in Quotetracker.(Thanks to Boogster for the original script)
This automated Trade System works the same way my Bracket Trader Automated System for QuoteTracker works, so I have made 1 video detailing how to setup Zeroline Trader to enable automated trades. I Like Zeroline Trader over Bracket Trader for the Automated Trade system because Zeroline Trader has more options to configure strategies and you can setup the automated trade system to trade multiple symbols very easily.



Here are some Tips-
Make Sure your Page is named "Futures" in ZeroLine Trader and your email template is setup to trade the Contract based on the Data Row ID in ZeroLine Trader

How to setup the Order Email template in QuoteTracker-

For reference on how to setup the ATS, you may want to watch my other videos.
Boogster made a very detailed post on how to make an ATS and I decided to make a tutorial video following his guide. If you have a broker that accepts API connections like Interactive Brokers, then you can make this Automated Trading System for Free. Here are the downloads you'll need-

Medved Quotetracker

- Free Charting Software

ZeroLine Trader

- Trade Management Software

Mailenable

- Free Mail Server

ActiveState Perl

- Free Scripting Software

HPT's ZeroLine Trader Perl Script

- An email client that checks your email and enters a trade into ZeroLine Trader when a new alert is found in QuoteTracker

Interactive Broker’s TWS Demo

- A Free Demo account with Interactive Brokers

Visual C++ 2005 from Microsoft

-This is software required by the InteractiveBrokers API to register properly

The Videos below were made as a tutorial for setting up QuoteTracker to Bracket Trader as a complete Tutorial. If you had trouble getting the ATS to work for ZeroLine Trader, these other Tutorial videos I made for Bracket Trader ATS may help you, as the only difference between the ATS between the two applications is the Order configuration and Perl Script. The old Perl Script used for BracketTrader will not work for ZeroLine Trader, you must download the new one above.

HPT's ATS Tutorial Part 1 - Downloading Software Setup


Part 2 - Installing and Configuring software


Part 3 - Setting up Quotetracker & ATS Email Tempelate


Part 4 - Bracket Trader Setup & Live Trade


Part 5 - ATS Exit Signals & IB Demo Account


Example of ATS Exit signal working


I would like to give a special thanks to Boogster for his work on the ATS perl script, Jerry for his awesome charting software QuoteTracker, and Hong for his excellent Trade Management software ZeroLine Trader.

QuoteTracker to ZeroLine Trader Automated Trade System

I have written a perl script which enables you to make automated trades based off of signals generated in Quotetracker.(Thanks to Boogster for the original script)
This automated Trade System works the same way my Bracket Trader Automated System for QuoteTracker works, so I have made 1 video detailing how to setup Zeroline Trader to enable automated trades. I Like Zeroline Trader over Bracket Trader for the Automated Trade system because Zeroline Trader has more options to configure strategies and you can setup the automated trade system to trade multiple symbols very easily.



Here are some Tips-
Make Sure your Page is named "Futures" in ZeroLine Trader and your email template is setup to trade the Contract based on the Data Row ID in ZeroLine Trader

How to setup the Order Email template in QuoteTracker-

For reference on how to setup the ATS, you may want to watch my other videos.
Boogster made a very detailed post on how to make an ATS and I decided to make a tutorial video following his guide. If you have a broker that accepts API connections like Interactive Brokers, then you can make this Automated Trading System for Free. Here are the downloads you'll need-

Medved Quotetracker

- Free Charting Software

ZeroLine Trader

- Trade Management Software

Mailenable

- Free Mail Server

ActiveState Perl

- Free Scripting Software

HPT's ZeroLine Trader Perl Script

- An email client that checks your email and enters a trade into ZeroLine Trader when a new alert is found in QuoteTracker

Interactive Broker’s TWS Demo

- A Free Demo account with Interactive Brokers

Visual C++ 2005 from Microsoft

-This is software required by the InteractiveBrokers API to register properly

The Videos below were made as a tutorial for setting up QuoteTracker to Bracket Trader as a complete Tutorial. If you had trouble getting the ATS to work for ZeroLine Trader, these other Tutorial videos I made for Bracket Trader ATS may help you, as the only difference between the ATS between the two applications is the Order configuration and Perl Script. The old Perl Script used for BracketTrader will not work for ZeroLine Trader, you must download the new one above.

HPT's ATS Tutorial Part 1 - Downloading Software Setup


Part 2 - Installing and Configuring software


Part 3 - Setting up Quotetracker & ATS Email Tempelate


Part 4 - Bracket Trader Setup & Live Trade


Part 5 - ATS Exit Signals & IB Demo Account


Example of ATS Exit signal working


I would like to give a special thanks to Boogster for his work on the ATS perl script, Jerry for his awesome charting software QuoteTracker, and Hong for his excellent Trade Management software ZeroLine Trader.

A Sample Trading Plan

Jeff Quinto has a video on the CME website on how to setup a trading plan.
Here are the key topics Jeff suggests and my answers:

Which contract or stock will I trade?

I'm trading stocks and futures.

What time period will I trade?

I trade the first 3 hours of market open primarily, while liquidity is best.

What setups will I take?

I discretionary trade the automated signals I have created. I determine if the current market condition suites any trade signals my system generates and then I choose whether or not to take the trade.

What Risk parameters do I use?

I have a max daily stop loss in place in case I make too many bad trades.

What do I do after 3 losing trades?

I determine if I should stop trading based on if I'm feeling frustrated or if I should keep trading my signals until my daily max loss is reached.

What is my strategy for increasing or decreasing my trading size?

I trade 1-2 contracts for the initial position and only add to winners on clear trending trades (market internals heavily favor bulls/bears -ie TICK and NYSE A/D favor bulls/bears).

How many ticks or points am I trying to make per day?

I don't have a set target, I only take what I can get.

How many trades do I make per day?

I only make 3 to 5 trades per day on average. Most trading days only make 3 significant swings, so my primary goal is to be apart of the primary move or catch a reversal swing or continuation trade.

How long do I plan to hold winners or losers?

I hold winners as long as possible, scaling out as I see fit. I hold losers for as long as I need to as long as my stop is not hit.

How do I record my progress?

I keep a journal of my trades with trade statistics and a chart showing where I placed my trades.

Who do I call if my computer or internet has a problem?

I have stops in place for all my trades so I'm covered, however I can also access my account from my phone or call my broker.

A Sample Trading Plan

Jeff Quinto has a video on the CME website on how to setup a trading plan.
Here are the key topics Jeff suggests and my answers:

Which contract or stock will I trade?

I'm trading stocks and futures.

What time period will I trade?

I trade the first 3 hours of market open primarily, while liquidity is best.

What setups will I take?

I discretionary trade the automated signals I have created. I determine if the current market condition suites any trade signals my system generates and then I choose whether or not to take the trade.

What Risk parameters do I use?

I have a max daily stop loss in place in case I make too many bad trades.

What do I do after 3 losing trades?

I determine if I should stop trading based on if I'm feeling frustrated or if I should keep trading my signals until my daily max loss is reached.

What is my strategy for increasing or decreasing my trading size?

I trade 1-2 contracts for the initial position and only add to winners on clear trending trades (market internals heavily favor bulls/bears -ie TICK and NYSE A/D favor bulls/bears).

How many ticks or points am I trying to make per day?

I don't have a set target, I only take what I can get.

How many trades do I make per day?

I only make 3 to 5 trades per day on average. Most trading days only make 3 significant swings, so my primary goal is to be apart of the primary move or catch a reversal swing or continuation trade.

How long do I plan to hold winners or losers?

I hold winners as long as possible, scaling out as I see fit. I hold losers for as long as I need to as long as my stop is not hit.

How do I record my progress?

I keep a journal of my trades with trade statistics and a chart showing where I placed my trades.

Who do I call if my computer or internet has a problem?

I have stops in place for all my trades so I'm covered, however I can also access my account from my phone or call my broker.

Quotetracker Automated Trade System Execution Speed

I tested out the execution speed for my QuoteTracker Automated Trade System today and made a video. It took 6 seconds from the time the signal fired to the time I got filled. Also the trailing stop adjusted to the trade what appeared to be less then a second on bracket trader and IB's TWS. Six seconds really isn't that bad of a lag depending on the type of strategy your implementing.



On a side not, I noticed QT's charts were printing candles 1min ahead of the actual time stamp, ie the 6:15am 1min candle (1min candle chart) should have had a close of 940.75 with 537 as the volume but instead it had the close for the 6:15am as 941.25 and 1310 as the volume, which in actuality should have been the close for the 6:16am 1min bar.I checked against IB and ZenFire data, so this is just an issue with QT printing candles 1min early.

PS- How often do you get door to door religious recruits coming to your house? I'd say I average about 1 every 2 months. They always come in groups of 2. I normally try to answer the door naked before they walk away. Good times.........

Quotetracker Automated Trade System Execution Speed

I tested out the execution speed for my QuoteTracker Automated Trade System today and made a video. It took 6 seconds from the time the signal fired to the time I got filled. Also the trailing stop adjusted to the trade what appeared to be less then a second on bracket trader and IB's TWS. Six seconds really isn't that bad of a lag depending on the type of strategy your implementing.



On a side not, I noticed QT's charts were printing candles 1min ahead of the actual time stamp, ie the 6:15am 1min candle (1min candle chart) should have had a close of 940.75 with 537 as the volume but instead it had the close for the 6:15am as 941.25 and 1310 as the volume, which in actuality should have been the close for the 6:16am 1min bar.I checked against IB and ZenFire data, so this is just an issue with QT printing candles 1min early.

PS- How often do you get door to door religious recruits coming to your house? I'd say I average about 1 every 2 months. They always come in groups of 2. I normally try to answer the door naked before they walk away. Good times.........

Who is HPT?

Hi, I go by the name of HPT. I live in California and I'm a full time trader.
I've been trading stocks, futures and options for years.
I primarily day trade stocks and stock futures such as ES, YM, and NQ.
I also day trade bond futures ZF, ZN, and ZB.

I use QuoteTracker and NinjaTrader for my charting software, Zenfire as my data feed for futures, and Interactive Brokers as my stock data feed and broker. I'm also using NinjaTrader to backtest trading ideas for my automated trading system. (learn about the free automated trading system I setup with Quotetracker)

I run a live trading channel where you can see me trade live and where you can chat with several other traders-

Justin.tv HPT Trading Channel



Ustream.tv HPT Trading Channel (Ustream channel is inactive currently)


For trading I use two 22 inch monitors and a fast computer. To read more about my setup checkout My Chart Setup.



I have several trading techniques that I use for day trading that I go into great detail on my "High Probability Trade Setups" post.



I also have recorded videos of my live trading and put them on my youtube channel.

Who is HPT?

Hi, I go by the name of HPT. I live in California and I'm a full time trader.
I've been trading stocks, futures and options for years.
I primarily day trade stocks and stock futures such as ES, YM, and NQ.
I also day trade bond futures ZF, ZN, and ZB.

I use QuoteTracker and NinjaTrader for my charting software, Zenfire as my data feed for futures, and Interactive Brokers as my stock data feed and broker. I'm also using NinjaTrader to backtest trading ideas for my automated trading system. (learn about the free automated trading system I setup with Quotetracker)

I run a live trading channel where you can see me trade live and where you can chat with several other traders-

Justin.tv HPT Trading Channel



Ustream.tv HPT Trading Channel (Ustream channel is inactive currently)


For trading I use two 22 inch monitors and a fast computer. To read more about my setup checkout My Chart Setup.



I have several trading techniques that I use for day trading that I go into great detail on my "High Probability Trade Setups" post.



I also have recorded videos of my live trading and put them on my youtube channel.

HIGH PROBABILITY TRADE SETUPS

In this post I will be going over my typical trading day from the night before, to premarket, and to market close. I will discuss how I use the bond futures, the VIX, NYSE advance/decline line, NYSE tick, and block trades as a way to trade in conjuction with my volume based market profiling.

Volume based market profiliing-
First and foremost I look for trade signals in relation to the market profile. When price is away from the Point of control POC(highest volume area of the day) I look to take trades that would move back to the POC(like a mean reversion approach). To become familiar with market profile I suggest checking out Trading Naked's large number of educational links found at the bottom of his main page. Here are a couple charts which show what a market profiler looks for on a range bound day and a breakout day.(courtesy IOAMT.com)





My Trading methodology-
I look for short trade signals more so when price is above VAH(Value Area High), and I look to go long when the long signal is below VAL(Value Area Low). When trade entries are made with regard to volume profile on a range day, profit targets should be set to the POC, VWAP, or an exit based on a tick extreme. Entry points are based around block trades seen in IWM and SPY, with the prefered entry made at a tick extreme. When trade entries are made with regard to volume profile on a breakout day then I look to exit when there is heavy volume at a tick extreme.

The Night before the trading day-
What happened yesterday? Did we have a breakout trend day or a range bound day? If the previous day was a bullish breakout day, then I would have a bias to take trades based off my trading method that would be buying VAL and vice versa if the previous day was a bearish trend day. If the previous day was a range bound day, then I would be looking to short VAH and buying VAL normally; however I will also be looking for breakout trend days driven by catalysts such as economic news and in some cases breakouts based on technical analysis like having a 3-7 day narrow trading range(NR3-7). Below is an example of how I charted my volume market profile forecast for the next day.
(NOTE: All of my charts are set to Pacific Time, because that is the time zone I live in.)



Also in my research the night before I like to look at the daily, weekly, and monthly volume profile for the markets I follow by going to Chart-ex.com. By checking out the volume profile on a weekly and monthly chart, you can see volume gaps; which are areas that I typically expect to be filled. Here is an example of the volume profile charts from chart-ex on ER2 taken February 23, 2007. In the chart you can see price is trading at VAH on the weekly and monthly time frame, with a volume gap to the downside.



The start of the trading day-
Premarket: What is the news for the day? What could be the catalyst for a breakout trend day? In order to be prepared for pending news events I checkout the forex factory calendar, which gives pending news events for not only the US, but for all of the world; with regards to the currencies, bonds, and stock markets of the world. Rueters market calendar and Econoday,
are good as well for tracking US specific pending news.

Market open: Is there a gap up/down at market open, and if so, why? Most of the time the gaps in the morning are due to economic news being released before the morning bell around 8:30am EST. Most traders know that morning gaps are good trading opportunities because they have a high probability of being filled or at least partially filled within the first hour of trading. Here is an example from March 29, 2007 of a morning gap due to the GDP # being released before premarket, with the result of a 9pt gap on ES being filled with the first 2 hours of trading.



I will now discuss how I use the bond futures, the VIX, NYSE advance/decline line, NYSE TICK, and block trades as a way to trade in conjuction with my volume based market profiling.

Bond Futures-
Starting during premarket of the stock market I track ZN, which is the most heavily traded bond futures contract(I also track ZF and ZB contracts as well). When watching ZN I look to see if there is heavy volume being traded and if there are any correlations or inverse correlations between ZN and ES. Some days you can see an inverse relationship between ZN and ES and other days you will see no relationship at all. The relationship between ZN and ES is a more advanced trading method that should be used in conjunction with other intraday market breadth indicators as a way to help confirm your trading signals. Here are some examples of the inverse relationship seen between the bond futures and ES, ER2, and SPY.







Sometimes you can see a positive correlation between ZN and the VIX, seen more so during the first 2 hours of trading. Here's an example.



The VIX-
Sometimes you can see divergences between ES and the VIX. Here are some chart examples.






NYSE Advance/Decline line-
By watching the NYSE A/D chart you can stay on the right side of the trend and see where possible breakouts in volatility may be placed. Here are some chart examples compared with ES and SPY.






NYSE TICK-
The NYSE TICK is one of the best intraday market breadth indicators for gauging short term price movements as noted by the NYSE TICK expert Dr. Brett Steenbarger. Some of Dr. Steenbargers articles on trading with the NYSE TICK can be found at Traderfeed. Here are some of my chart examples using NYSE TICK.



ER2 example.



YM example.



This tick chart of SPY highlights block trades as red dots compared to NYSE TICK.



Here is an example of NYSE TICK compared to NYSE A/D.




Block Trades-
I filter for block trades(50-200,00 shares) on the ETF's of the underlying stock indices as a way to track large traders. I particularly look for these block trades around NYSE TICK extremes as signals for short term scalping opportunities and places to exit if I'm already in a trade. I do this because I don't have software like marketdelta, and I like looking for large volume trades in the ETF's because these block trades are seen as better signals when compared to ES and ER2 block trades. Here is a great article from Traderfeed on Tracking Large Traders. Here are some chart examples showing block trades highlighted as red and green dots on the ETF's I follow.





Here is a chart of ER2, NYSE TICK, and IWM showing block trades near NYSE TICK extremes.



Trade examples-
Here are a couple of my trading days taken from my journal that show my trade executions posted above the chart.

Here is an example of one of my trading days where I used a tick chart of SPY showing block trades for guidance in trading ER2 and YM. I looked for short signals because we were trading near VAH and there was no sign of a catalyst to turn the day into a breakout trend day.




On this day I saw a double top on NASDAQ A/D and NYSE A/D, with the NASDAQ A/D line being the more bearish of the 2 charts. Also we were trading in the VAH, so based on my volume profile trading methodology I used this as a way to confirm my short trade signal.