Google’s (Pam’s) talk on Trend Days August 13,2002

google_2: before I begin, let me forewarn you

google_2: giggle

google_2: I get bumped and bounced from paltalk all the time

google_2: so if I magically disappear, be patient

google_2: I'll resurface

google_2: :-)))

google_2: session will last for 1 hour

google_2: 15minutes on defining what makes a trend day

google_2: 20-25 min. showing charts

google_2: last 20 or so will be for any questions anyone might have

google_2: some of you might know what a trend day is

google_2: but to have everyone on the same level, I'll just go through it briefly

google_2: and add some other hints

google_2: a trend day is defined when the market(s) is moving in 1 direction all day

google_2: all charts will be posted in tomorrow's folder for the time being

google_2: yes, I created that folder but for some reason I'm getting the same error message

google_2: maybe buffy will solve this while I go over the intro

google_2: thanks girl

google_2: trend days are the most difficult

google_2: especially for traders who are starting out

google_2: they're tricky in the sense that many want to second guess them

google_2: so if the market been going up for 2 hours or so, there's a tendency to try to pick a top

google_2: and establish a short position

google_2: one of the most successful traders I've come across

google_2: used to make a killing on such days

google_2: and try to play good defense on consolidation days

google_2: here are some basic facts

google_2: re trend days

google_2: market moves in 1 direction

google_2: frequency: 3-6 times per month

google_2: 6 is on the extreme

google_2: usually the number hovers around 3-4

google_2: when we talk about probabilities of what days might turn out to be trend days

google_2: in the following order:

google_2: Wed., Thurs., Tues., Fri., Mon.

google_2: and that's logical

google_2: since most traders don't want to establish large positions by end or start of week

google_2: of course there're exceptions

google_2: but I'm talking about the norm

google_2: Wed. and Thurs. have the highest probability for turning out to be trend days

google_2: now another important characteristic of a TD

google_2: is that the average true range (ATR) of a TD is ATR *1.5

google_2: let's examine this for 1 min

google_2: simply put, one needs to find out the average number of points per day

google_2: for the last months that has been = 40 pts.

google_2: or so

google_2: so if a normal day = 40 pts., we should expect a trend day to = 40 * 1.5

google_2: therefore = 57=60 pts.

google_2: 57-60

google_2: that's a very important fact that one needs to be aware of

google_2: especially when we begin talking about exit strategies

google_2: will leave that till later

google_2: another fact about TD, is that

google_2: "most, if not "all", oscillators fail on trend days"

google_2: they give a lot of false signals in terms of reversals

google_2: and price just keeps going up

google_2: in case of up day, and vice versa

google_2: lastly,

google_2: trend days are idea for establishing sizeable positions and scaling out vs.

google_2: "scalping" for few points

google_2: i.e. that's where the big money is made to make up for all the small losses incurred during other days

google_2: before I move on, any q?

eddhyne: can you give one example

google_2: ok

google_2: NQ and ES

em4x13: r these td ratings based on your own research?

google_2: that's what we're discussing

google_2: trading emini futures

elroch: Can't false oscillator signals can be avoided by using a trend indicator like DMI? I only trade with a trend.

Rice21: Pam, mightn't oscillators be useful to help with entry on a pullback?

google_2: yes my own research, and from other established traders

google_2: elroch, rice, agree

google_2: p-8 will get to that

google_2: now onto another interesting part

google_2: what to look for to anticipate trend days

google_2: narrow range 4

google_2: meaning narrowest range in the last 4 days

google_2: implies low volatility

google_2: that's from "Toby Crabel's" book

google_2: btw

google_2: NR7 is even better

google_2: implying very narrow range over the last 7 trading sessions or so

tradethewave: intraday?

google_2: daily ranges here

google_2: now another simple technique

upside1: yesterday was nr7

google_2: is to plot trendlines on 68m charts and daily charts

google_2: breaching such simple TLs is always explosive

google_2: especially on the timeframes I just mentioned

google_2: also look for wedges and continuation patterns

google_2: on 68m and daily

google_2: very important

google_2: we mentioned NR and geometry

google_2: now the last 2

google_2: and monitor it for 30 min.

google_2: watch the TRIN at the open

google_2: (0.25-0.80) for updays

google_2: 1.1-2.5) for down days

google_2: rule is to wait for at least 30 min.

elroch: is that 68 minutes?

google_2: that's TRIN on 3m timeframe

google_2: lastly,

google_2: look for "plurality" of the markets

google_2: i.e. DOW, SP(ES), SOX, NDX(NQ) to move in unison

google_2: if one is lagging behind then most probably it isn't a trend day

google_2: ok, I'm going to move on to show some charts

google_2: but before I do that

google_2: today's session is about TD type I

google_2: why type I?

google_2: because I've identified 4 other types

google_2: and they're all listed in my upcoming book

google_2: each of these types has certain characteristics

google_2: and it becomes easier to differentiate

google_2: once one knows what to look for

google_2: so let's talk about the "classic" TD

google_2: I'll post all chart links here

google_2: while I'm typing

google_2: so no need to search on website

google_2: first series of charts will walk us through how a trend day develops

google_2: and what to look for

google_2: see google_trend_day_example_1_A.gif

google_2: let's look at this for 1 min.

google_2: I've used NQ 3min timeframe

google_2: and that's the TF I mainly use

google_2: on the right

google_2: you'll see 3 other smaller charts

google_2: DOW; ES; SOX

google_2: the 3 other indices(markets) I monitor throughout the day

google_2: lastly on the bottom is the TRIN

google_2: I've chosen 7/24

google_2: and very recent

google_2: easy to remember :-)

google_2: that's when the market supposedly bottomed

google_2: now we opened with a gap down

google_2: and that level on NQ coincided with some fib levels

google_2: which I didn't plot

google_2: so the attention is on what the market will do

google_2: will it close the gap or not

google_2: trin is very low

google_2: and continues to be for the next 30 minutes or so

google_2: so a position is established

google_2: only after a b/o pattern is in place and visible

google_2: and that's what this chart shows

google_2: 4 markets with same pattern

google_2: at exact same time

google_2: that's a very ideal situation

google_2: and makes a good candidate for some move to the upside in this case

google_2: disaster stop placed @ lod – (low of day)

google_2: personally, I place my stops tighter than that

google_2: usually below flat b/o

google_2: on this chart also I've market an aggressive entry

google_2: and that type of entry is reserved for experienced traders

google_2: more on that in a little bit

google_2: we're now in a long position

google_2: fast forward the clock

google_2: :-)

google_2: this chart has some important points

google_2: first of all

google_2: exits should be based on fibs or measured moves

google_2: if we have some minor swings with the first major swing

google_2: look for topping patterns

google_2: like in this case 3 pushes up

google_2: check for time of day

google_2: the closer we get to 11:45-12:00 the chances of this swing terminating become greater

google_2: scaling out is discretionary

google_2: in this case

google_2: I usually scale out 1/2 or 3rd the position

google_2: and leave the rest to run

google_2: till price hits a critical level

google_2: you'll also notice

google_2: that all markets are still in "unison"

google_2: plurality at its finest

google_2: i.e. 3 pushes up on all

google_2: check time

google_2: it's 12pm

google_2: lunch hours

google_2: also I've market some conservative entry

google_2: on the break of the 2nd minor swing

google_2: now if we measure

google_2: that entire morning swing

google_2: we see that it's 54 pts.!!

google_2: important to note that

google_2: just the first 2.5 hours price traveled beyond a typical ATR

google_2: which = ~40-45 pts.

google_2: that's certainly a flag

google_2: telling me that there might be continuation later in the day

google_2: possible retracements are projected

google_2: ideal retracements for TD type I are 23-38%

google_2: 50% is certainly the exception

google_2: a typical morning swing for TD type I is 40-45 pts.

google_2: but we have 54 pts. so 50% is also suitable for such a range

google_2: for TD type I day

google_2: the rule is:

google_2: "the longer the BETTER!"

google_2: on top marked in pink is ideal consolidation time

google_2: now on this 3rd chart

google_2: need to note the intraday pattern

google_2: during consolidation

google_2: dbl bottoms like the ones you see on this chart

google_2: are very typical

google_2: for type I

google_2: actually if they do show up

google_2: I become more confident about the type of day we got

google_2: so far price has retraced to 50%

google_2: of morning range

google_2: we got dbl. bottoms on all markets!!

google_2: doesn't happen that you see this dbl. bottom on others at the same time

google_2: but in this case it's a good sign

google_2: geez, I'm running out of time!!

google_2: :-)

google_2: also, on the bottom

google_2: very very low

google_2: the trin is almost a flat line close to 0.4

google_2: no need to counter trade it

google_2: it's still 1:30pm

google_2: and we need to see more

google_2: Look at google_trend_day_example_1_D.gif

google_2: on this chart here, we can see that the market(s) are beginning to make a move

google_2: the closer we get to 3pm w/o breaking out (or breaking down) the better

google_2: this is very ideal

google_2: again, 2 types of entries

google_2: aggressive for experienced

google_2: conservative for ones starting out

google_2: personally, I try to go long once that dbl. bottom is hit

google_2: disaster stop is close to that 50% fib level

google_2: now the puzzle has been figured out

google_2: all indications so far point to TD type 1

google_2: type I

google_2: the morning range; low trin; consolidation level;

google_2: consolidation time

google_2: and that should help in putting on a sizeable trade in the afternoon

google_2: the pattern is simply as follows:

google_2: 2 MAJOR SWINGS with consolidation stretching to 2:30pm or beyond w/o exceeding the 38%-50%

google_2: as simple as that

google_2: that's the formula

google_2: now that helps a lot in determining exits

google_2: I always like to look for measured moves

google_2: when it comes to type I

google_2: since they occur a lot

google_2: so the expectation is afternoon swing will = morning swing

google_2: that sure will let one wait on the trade

google_2: and let it run

google_2: for max. gain

google_2: on top of the chart

google_2: I stated that one can keep 1/2 or 2/3 of the position open till close

google_2: or liquidate at certain fib levels

google_2: scaling out is very important

google_2: yes, it looks like a TD

google_2: but one never knows

google_2: so it's always advisable to take some off the table

google_2: and take a deep breath while the market does its thing

google_2: Look at google_trend_day_example_1_final.gif

google_2: on this last chart of this series

google_2: one can see the pattern and outcome very clearly

google_2: perfect symmetry re pattern

google_2: with all the right indications

google_2: ok, this concludes this series of charts

google_2: I noticed I've exceeded the allotted time

Richard_: that was cool, let's do a trend day tomorrow!

google_2: to answer any question

Richard_: you're welcome to all the time you need

TurnSig: What are the RED bars and what do they signal to you?

Rose_0313: Beautiful presentation, Google, as always. THANK YOU.

biglargra: google, actually, much appreciated, ty

google_2: this chart here

google_2: is another example of TD type I

google_2: just upside down

google_2: :-))))

google_2: same rules

google_2: 2 swings with consolidation/retracement

google_2: very important to watch the time of day on that pattern

Lightfoot500: When's your book coming out, Google?

google_2: also notice the "plurality of the markets"

google_2: accompanied by a low trin

google_2: and the bearish pattern

google_2: that signaled continuation

elroch: How often does it happen that a day looks like a trend day, but changes its spots later on?

google_2: those are the kinds of patterns one needs to jump on

google_2: and stay w/the trade as long as possible

google_2: now one comment here

upside1: Question--today started off looking like a trend day --when could you say it was not??

google_2: traders who trade very small timeframes like 7 or 30 tick charts or whatever

google_2: will find it difficult to capitalize on such days

robin91: thanks google, if your book is anything like this talk then I am going to be first one to buy it

Richard_: what about pre-market setup, google? any observations?

google_2: elroch,

Richard_: many small timeframe traders hate trend days

google_2: that's another type of TD

google_2: in my book

Rose_0313: Google, is the TRIN the key to recognizing that the flag in example 1 is not a continuation pattern to the downside?

google_2: upside,

upside1: y

google_2: when the morning range doesn't reach ATR

google_2: trin reverses

google_2: no Plurality

google_2: etc.

google_2: I've noted all the criteria that make TD type I

jhemm: great job google.....cant wait to get copy of your book

google_2: richard

google_2: yes

google_2: watching basic geometry on 68m and daily

google_2: is key

google_2: to determining trend day candidates

google_2: rose, yes

p_8: Goggle, what do you think of pyramiding UP trading position instead

google_2: I like the idea p-8, and did that on few instances

google_2: but I do enter with full position on any given trade most of the time

google_2: but sounds like a great idea for a trend day

google_2: let me make some final comments

Rice21: where does the 68 minute chart come from?

google_2: it's always advisable

google_2: when trying to learn market dynamics

p_8: do you have any specific trigger for you to decide to pyramid?

google_2: is to wait for the afternoon trade

google_2: and trend days are no exception

rokhie: I will ask some question goole if u do not mind

google_2: someone w/not enough experience

google_2: might get fooled and try to outsmart the pattern

google_2: yes p-8

google_2: continuation patterns

google_2: e.g. dbl. and 3 humps

p_8: ok

google_2: ok, I think I'm done

google_2: any q?

The Pollunator: where can I view the transcript?

Buffy_04364: very nice google thanks

p_8: bravo google, great topic

pmtrader: tnx - that was great

wesley35: thanks great presentation

rokhie: those trendlines

google_2: pollu, will be posted on dacharts.com

Richard_: thanks much

google_2: ask buffy

rokhie: are they drawn

rokhie: automatically?

pilgrim_7: that was great, thx google

google_2: yes rok

google_2: no, manually

robin91: do u use 3 min charts google

rokhie: ok

TurnSig: Thank you Google.

pete77_1: Thanks very much

burniew: Google: You watch the 68 Min and daily for patterns...but trade the 3 Min ???

hark33: Great presentation, answered questions I didn't know to ask!

rokhie: thks

strategyman: Thanks for the great TL presentation

js1257: THANX GOOGLEE

google_2: robin, yes

google_2: yes burn

google_2: 13m too

rokhie: I use pivot numbers only

google_2: you're welcome everyone

ann_87: Thanks Google, very nicely presented as usual

rokhie: thks google

robin91: good luck with your book, google

google_2: this presentation was about patterns

strategyman: Any update on the book?

google_2: understanding market dynamics

rokhie: yes

google_2: strategy, due out around end of December

Richard_: strategy?

strategyman: thx

rokhie: I know two packages that draw those lines

google_2: richard, good point

google_2: now if one knows what type of day it is

google_2: then indicators can be overlaid

wolfblz: Google, what is typical ATR for ES? Do you know?

rokhie: your charts are very clean

google_2: and take advantage of entry points etc.

google_2: personally, I got no use for them

google_2: rok, what lines?

google_2: wolf

google_2: ES's volatility has picked up as of late

burniew: Thanks Google How long have you been a professional trader. .. First book ??

TurnSig: Google: What are the red bars?

google_2: but it used to be 12-16

google_2: red bars are turning points

google_2: can access them from bar colors option

google_2: just something to break the green color pattern

wolfblz: thks google

TurnSig: LOL...Thanks.

google_2: might be useful

google_2: burn, over 2 years now

google_2: yes, first book

google_2: today's notes were taken out of the book

google_2: that's the kind of material one should expect when reading it

google_2: so hopefully it'll be of good help to others

burniew: Tks and best of luck on book.. big time commitment !!

google_2: thanks

rokhie: the way u draw those lines it looks like elliot wave

rokhie: or gann theory

google_2: oh ok

google_2: yes, it's the elliot wave tool

google_2: actually rose showed me this trick

google_2: to calculate measured moves on the fly

1084sassy: is the book available yet

google_2: end of Sept.

google_2: it's a course

google_2: on how to trade eminis

google_2: from A-Z

google_2: covers how to put a plan together

google_2: what kind of material one needs to read

google_2: my own patterns

google_2: how to prepare yourself

google_2: mentally to become a professional trader

google_2: what performance measures/gauges to use

google_2: on a daily/weekly/monthly/annual basis

1084sassy: how will we able to find it

upside1: publishers name?

google_2: will be announced

google_2: dacharts.com for now

google_2: can find my other charts and session transcripts on dacharts.com

xtrader: google to be a full time successful trader after only 2 years a great accomplishment.... what is main thing you attribute this to... did you have a mentor/

google_2: it's due out end of Sept. not end of Dec.

google_2: in few weeks

hanksterr: great class google wish it was longer, hope you do another one soon, add me too your first book list

wolfblz: R, Was a study done on es atr?

google_2: xt, yes I had

google_2: was lucky in that aspect

google_2: but then focused more on "discipline" and "consistency" more than trading itself

google_2: very sweet as usual

google_2: hank, thanks

hanksterr: mean every word seriously

The Pollunator: google, how many classes have you given so far?

xtrader: thanks... who was the mentor

google_2: my personal email is

google_2: pamdanielson@yahoo.com

google_2: if you have any questions

google_2: poll, I think 3

google_2: this is the 4th

google_2: xt, independent shark

google_2: oops, trader I meant

google_2: :-)

google_2: traded 100 lots

xtrader: 100 lots wow... did he hold all day on trend days

p_8: emini or the big one?

google_2: that's 2k/point

google_2: traded both p-8

google_2: but mainly emini

google_2: he liked the liquidity

hanksterr: google do u think the ES or the NQ are better to trade now

google_2: ES

google_2: I use NQ to trigger ES trades

hanksterr: thx

p_8: I'll give my 1 contract to him to trade google :-)

google_2: NQ has less fakes

google_2: than ES

google_2: lol p-8

rokhie: small trader will be big trader one day

elroch: How do the trading costs compare between NQ and ES these days? (spreads and any other costs)

google_2: costs same

Richard_: so do you categorize all your days, google?

elroch: How many points/$? (I use a different trading mechanism to the e-minis)

google_2: richard, absolutely

google_2: that's my own personal history bank :-)

google_2: can't see without it

google_2: :-)

Richard_: :-)

google_2: pd, ES tends to break some trendlines only to reverse

google_2: vs. NQ

p_8: google, you have a trading diary?

google_2: NQ and sox are better gauges

Richard_: so by noon you've got things all figured out

google_2: p-8, part of the book is my trading diary

elroch: Do you find the markets more closely parallel each other than they used to?

google_2: richard, for most days yes

google_2: elroch, if they aren't I have trouble w/direction

p_8: cool, I wanted to ask what info you put in your daily trading journal/diary

xtrader: so do you trade before noon or only after

google_2: nevertheless, there're times when intermarket divergence is beneficial

google_2: p-8

google_2: daily chart, annotations of what happened

google_2: entries, time of entries, exits, time,

google_2: vital signs throughout the day

google_2: any new observations

google_2: mental errors

google_2: I spend like 30 min everyday after close to update it

p_8: what happened in the market or in your head or both?

p_8: oh ok, both

google_2: but usually I make notes while throughout the day

upside1: favorite entry signal?? trendline?

google_2: xt, both

xtrader: okgoogle_2: upside,

google_2: entries are based on patterns coinciding with critical levels

elroch: Did it take you much time trading before you made a consistent profit?

xtrader: so I guess morning not figured out so less size then size in afternoon?

pd123: and critical levels are found with fibs right?

google_2: elroch, I lost all my capital before I met my mentor, to make a long story short

google_2: pd, not only fibs

google_2: fibs is just 1 tool

pd123: what else?

google_2: more on that in another session

xtrader: lost all you money.. hey you a real trader thengoogle_2: that can be a nice topic

google_2: I guess so xt, giggle

xtrader: similar experience

upside1: today had no critical levels or fib #--did you stay out??

robin91: who was your mentor google? or u not allowed to disclose this information to us

robin91: information

elroch: I have made money before the spreads every day recently, but have lost after the spreads!

p_8: google, hey, maybe next time you could do a session "a day in google's trading life" to show how you prep the market, thought/action taken during market and post market

p_8: even better, done on video :-)

burniew: What was your working back ground before trading ?? What did it teach you that helps with trading ??

x21r: guys wait *** google_2 has left the group ***

============================================================