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Trade Point Technologies

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Paris, France
Trading Experience: Advanced
Platform: Market Delta & Ninjatrader
Favorite Futures: ES
cunparis's Avatar
Posts: 2,565 since Jun 2009
Thanks: 1,162 given, 2,070 received

I will just add one more point: When i was trying reverse engineer their algorithms for intensity, I was able to reproduce the peaks that Pat had posted in his charts showing the top and/or bottom of the day. However, my indicator also had other peaks leading up to that top/bottom. And so I asked Pat to share a chart of earlier in the day so I could see whether he had the same "false alert" peaks or if his algorithms were able to filter out the exact top/bottom. He never would post any other charts leading up to the top/bottom. If you look closely this chart of the top/bottom spans a very small timeframe. I found this same pattern occurs during the trading day and if one traded off that they'd have a very low win rate.

later I learned more about the market and auction theory etc. and now I believe that no one knows when the top or bottom is in until way after. Often when there is a huge volume spike (doesn't require intensity!) that is exhaustion volume or capitulation. Barry of Emini-watch has his "Better Momentum" indicator to show this and that's one of the key points he looks for before expecting a reversal. However Barry (or me) do not try to catch the top/bottom with this like Pat was claiming. For me when I see that potentially exhaustion volume I'm not expecting it to go much farther so for example if I'm trading short on pullbacks and I see exhaustion selling, I stop trading the short side. But I don't trade long either! I just walk away.

Someone else at Trader's Laboratory claimed to have come up with something similar to Pat's intensity, as far as I know, he didn't post that he was using it or that it was useful for him.

I hope this is helpful. Good trading everyone.

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