Site Administrator Swing Trader Data Scientist & DevOps
Manta, Ecuador
Experience: Advanced
Platform: Custom solution
Trading: Futures & Crypto
Posts: 50,092 since Jun 2009
Thanks: 32,552 given,
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received
Matt Davio, aka MissTrade, is the Founder and CEO of Anti Fragile Trading and Market Profile Trading Academy, and will be monitoring this thread so that he may answer any questions that you post here relating to his products or services, Market Profile and Auction Theory, or just trading in general.
Please keep in mind that some customer service/technical support issues are best handled through proper channels at Anti Fragile Trading/Market Profile Trading Academy.
Matt Davio has been a full-time professional trader since 1991. He primarily uses Market Profile as his basis for framing the market, and he trades a wide variety of products. Matt has worked with Peak6 Trading and Parallax, and has also run a private hedge fund.
Matt has also presented a couple of webinars on futures.io (formerly BMT). Check the webinars section for more information.
In addition to this thread, I will also be asking Matt Davio to stop by on occasion for a casual webinar where he can answer questions via audio while also sharing his screen to visually demonstrate any points as needed. The date/time of those sessions will be announced here in this thread. These sessions will be limited to questions only, there is no prepared presentation. After the session ends, the recording will be posted in this thread.
Feel free to ask any questions below and we'll do our best to get them answered.
The futures.io (formerly BMT) "AMA" (Ask Me Anything) series is by invitation only. It is part of a new program we are launching shortly called "Certified Trustworthy", something that has been months in the making. I will provide all the details of this new program as soon as it is ready for launch.
Site Administrator Swing Trader Data Scientist & DevOps
Manta, Ecuador
Experience: Advanced
Platform: Custom solution
Trading: Futures & Crypto
Posts: 50,092 since Jun 2009
Thanks: 32,552 given,
98,579
received
Matt,
Let me kick off the questions with a few of my own.
a) Why market profile and not volume profile? Do you believe time is more important than volume, or the relationship between time & price to be more important than volume & price?
b) Would you classify yourself as a scalper, day trader or swing trader?
c) When you look at a market like the ES which has been in a strong bull market for the last several years, and has been in a very tight upward channel this calendar year, what are you looking for in terms of a "setup" to take a trade? Balance, imbalance, micro trend reversal, continuations? What kind of patterns do you look for to initiate a trade?
Thanks for allowing this open feed and kicking of the start of questions.
I do utilize both Market (TPO) profile for my shorter term intraday charts along with going back about 3 weeks. I utilize these along with my longer term time frames charts which primarily focus on the Volume Profile. I find that the combination of both these tools helps me with the puzzle pieces that are this game of Markets. I do a top down look at the markets going back over 10 years to find long term trends and break it all the way down to the shortest time frames. Utlizing the Volume Profile here helps great find the areas of interest and control for me. The TPO is important in the intraday view more than the volume profile. I do consider Time more important that price, that is the more time at a price is more important than one tick at a single price for example.
I am definitely a daytrader if opportunities arise, however, I don't like to scalp, my goal for the day as a daytrader is to pull out 1/4 or 1/2 of the total range the day trades. So if the ES was 20 pts wide today, if I was successful I was able to take out 5-10 pts out of my daytrading efforts. I usually am able to do this if successful in 1-3 trades maximum. That being said, I have no problem swing trading positions, and those typically last 1 day to 4 weeks. I do utilize options in some of my longer timed trades along with futures.
Your 3rd question is not a simple answer. The ES has probably been my least favorite financial to trade over the 2013 campaign due to the severe dryness in total intraday ranges. I prefer the more wide NQ at this point as the ranges are so muted in the ES right now. I'm not much of a Pattern guy, i still prefer time over patterns and ultimately time over price. I know it sounds strange, to some, but when you view Time at price, I think it actually simplifies the decision making process.
There are times to fade the profile, go with the trend, and/or trade counter trend. It really depends upon where we have been and helping me to pick spots on where we may or may not go. I always write a daily narrative on the different futures vehicles I trade and have contingent narratives based on where I think the market could trade. That being said, the market doesn't always do what I want when I want, so you must be able to recognize when a plan goes bad, and have either and adjustment, or decide that the day has beat you and wait for better setups in the next trading days ahead. There will always be another day in free markets.
Looking forward to more questions from the Forum!
Thanks again Mike,
Matt
If you have any questions about the products or services provided, please send me a Private Message or use the BMT "Ask Me Anything" thread
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Mike I do trade the NQ mainly because it has traded wider than the ES for the past 6-9 months, and the wider moves offer me as an intraday trader more opportunities intraday than the ES right now. Alot of this has to do with AAPL and GOOG right now obviously.
I do trade the Euro and more importantly, as I've said vocally and loudly over the past 3=4 years, that the US dollar is the item that drives all currencies right now. All Central Banks are in the game to devalue their respective cuurrencies as fast as they can vs the others. Its an absolute chase to the bottom and the result we don't know, but I do know this has never been seen in the history of markets, where all countries are at once trying to devalue their currencies concurrently with all others. A true night mare, that the ending is unknown.
WOn't be pretty, and we won't know until how it begins until the first major currency fails.
Matt
If you have any questions about the products or services provided, please send me a Private Message or use the BMT "Ask Me Anything" thread
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Maybe the range as a function of the index price is greater for the nasdaq, but it looks like so far in 2013 the NDX range is averaging about 25 points a day, and at $5 per NQ tick, this yields a per contract high to low average of about 25*$20 = $500 per day. (I used NDX range which should be almost identical to NQ as I don't have an NQ chart up)
ES is averaging about 11.25 per day, and thus has a contract dollar range of 11.25*$50 = $562 per day.
Taking into account the spread being a bit over twice as high for ES, they come out about even in terms of high to low dollar opportunity per day, given an average number of trades.
So I suppose if one's strategy somehow depends on the movement of the index as a percentage of the index value, then NQ may be more advantageous, but in terms of sheer dollar opportunity per contract per day based on the range, ES comes out the winner, if only slightly.
The following user says Thank You to josh for this post:
Site Administrator Swing Trader Data Scientist & DevOps
Manta, Ecuador
Experience: Advanced
Platform: Custom solution
Trading: Futures & Crypto
Posts: 50,092 since Jun 2009
Thanks: 32,552 given,
98,579
received
I edited your last post to embed the video. You can wrap YouTube URL's around the [youtube] bbcode to embed them. Click 'edit' on your post to see my example.
Matt, here you talk about "deliberate practice" and you seem to use it synonymously with "preparation." You also say that most professionals spend about 3.5 hours a day doing this. When you prepare and develop your premise/idea/narrative, are you doing any type of other deliberate practice, or is this all standard market preparation type of things? Also, my preparation is for trading one market only and takes nowhere near 3 hours; I would guess that when you give this figure this is for traders who are trading several markets? Thanks, and I enjoyed the videos!
The following user says Thank You to josh for this post:
@MissTrade, I just watched all your videos posted here during the afternoon Matt. Thank you for sharing; the information is very helpful. A couple of questions:
1) I also use market profile quite a bit so I'm familiar with the methodology. A couple of times you talk about time opportunity and price opportunity. Can you more clearly define this? I tend to think of them as being interconnected in such a way that they cannot be separated. For example, I may see a price which has before been considered unfairly high or low, so that price presents an opportunity. However, I cannot trade that price except at certain time (and given a certain liquidity), hence time opportunity. So, I need the market to actually trade at that price so that there is both a price and time opportunity together (hence a TPO). In your "Trading shouldn't control your emotions" video you say early in the video that you "wanted to wait for time" to get short NQ. Can you be more specific about what this means to you?
2) As a general risk question--do you objectively decide when you are done trading for the day by using a hard, line in the sand loss limit (or weekly loss limit), or have you developed a more "in tune with yourself" approach so that you are able to know after a few losing trades that it's just not working today (or even this week)? Any insightful information you have on how to mentally frame losses, and how to overcome the tendency to want to be right on every trade (impossible, of course, easy to realize, not so easy to really accept) would be welcome.
Thanks again for the videos, I really enjoyed watching them!
I signed up for your $4.99 trial. I enjoyed your commentary/knowledge and even made some $ selling nq. My issue was that I never got responses to any emails that I sent, other than the one that contained my phone number so I could receive text messages. My welcome email (hours after I signed up) stated " Our goal is to have excellent customer service, so please don't hesitate to ask me anything."
I'm wondering what the best email to use is to get questions answered?
Also, what do you get when you sign up to "earn while you earn"? Is there a chat room, chart images, training videos, or what? Felt left in the dark.
Thanks for your time and knowledge,
The following 2 users say Thank You to lrfsdad for this post:
Although I'm following up a few days later, I want to mention that I did get immediate answers to my questions. It turns out that most of the issue was with my road runner email. thanks
Hey guys,
I just wanted to give everyone a heads up on trading with Matt and the MissTrade trading service. I followed them for over two months and tracked their performance pretty well over that time. They are profitable over a period but beware about the amount of risk you must be willing to accept. I would not recommend trading a live cash account with their ideas of less than $150,000.00, minimum. They tout "1 lot trader" all the time, but to have the same average fill you would need to scale sometimes up to 6 or 8 lots. When they send out the email about "1 lot trader netted xxx.00 dollars today" you have to understand they are taking their 4, 6, or 8 lot position, and dividing it down to the 'per contract' profit amount. So, somewhat deceptive there. If you're not prepared to take 30-40 points of heat on the NQ, or 250 ticks on the CL, then I would do what I did and track them with a sim account. All in all it's not a bad deal if you don't mind being spoon fed. My advice, learn to trade your own style with what your risk tolerance is according to your trade plan.
-Stay Frosty
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NARRATIVE For 7-16-13
July 16, 2013 · by Matt Davio
Even though the markets acted like they were closed we crept up and tagged the 1680 target area today. Today’s $ES volume couldn’t get over $1 million contracts (829K today). Regardless we keep floating up. A pullback would be welcome and we could see one in a couple of days. However, do not chase the market up at these levels. A nice pullback will give you a chance to hop on board. If you are long then stay the course, you could have taken some off at the 1680 area. Pull up stops and lock some in. CPI is released in the AM but the real fireworks will come Wednesday and Thursday when Uncle Ben testifies on the Hill. It will be interesting to see what the puppet master has in store for us. Have a great Tuesday. Trade well.
If you have any questions about the products or services provided, please send me a Private Message or use the BMT "Ask Me Anything" thread
Don’t let the small break fool you. A small double top lead to the small dip today. The volume was still very low (just over a millions contracts traded on the $ES). Today was most likely a few people unwinding some positions in front of Uncle Ben talking tomorrow and Thursday. I don’t blame them…I am not a big fan of holding into a puppet masters speech. No telling what that guy will say…so best to cover some and lock in profits. Also, if you are a newbie trader best to sit out the next two days. The market will most likely have some crazy swings before finding a direction. Up in this area a pull is needed but 1700 is calling the name of many a trader. There is nothing wrong with waiting for a better day to trade. Remember, successful trading doesn’t mean you have to trade every day. Have a great Wednesday…trade well.
If you have any questions about the products or services provided, please send me a Private Message or use the BMT "Ask Me Anything" thread
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What a love fest…I usually don’t watch Uncle Ben testify on the Hill but today, for some reason, I was drawn to his testimony. This will be the last time I probably tune in…it was a slobber fest of appreciation and gratitude rather than a true testimony. There was no real shockers out of today’s party. Uncle Ben finishes his “testimony” tomorrow and we will sit and see if the “buy ben” indicator kicks in and takes us over the 1680 area. Nothing to do in this area. Summer volumes have shown up. Alot of wait and see. If you are over trading in this junk or trying to scalp your way to riches…please stop before you empty your account. There will be better days ahead. This is “keep your powder dry” territory (unless you have been long from the last buy area). Have a great Thursday. Trade well.
If you have any questions about the products or services provided, please send me a Private Message or use the BMT "Ask Me Anything" thread
Uncle Ben got his indicator working early in the day but it took Google all of 3 minutes to kill it. The market bounced above the 1680 level and ran to 1688…but the google earnings announcement erased a good portion of that move…in about 3 minutes! So, was this a blow off top? Could be, but I am cautious because volume was low on the move up. Usually blow off tops max out volume before getting people stuck. Today’s move actually closed above the 1380 level and it took an earnings event to pull the market down. One company usually isn’t strong enough to reverse a market on a dime…however we have seen crazier things over the years. I am all for a pullback. We will be looking for areas to re-enter long with targets around the 1700 level. Sit tight and wait for it. Tomorrow is options expiration…so be cautious. Lots of weird moves usually happen on these Fridays. Also, volumes are seriously low so be extra picky about setups. Have a great weekend. Trade well.
If you have any questions about the products or services provided, please send me a Private Message or use the BMT "Ask Me Anything" thread
The initial spike lower was on GOOG, but the second was on MSFT, which was also a huge miss. MSFT and GOOG both have similar market caps but MSFT is actually a more heavily weighted component in the S&P so both misses contributed to the weakness after the bell.
