Platform: NinjaTrader, Tradestation, Think Or Swim
Broker: Mirus Zen-Fire
Trading: ES
Posts: 15 since Sep 2009
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Thanks. I went out to the TTT site and signed up for the 7 day trial. Went through the manual... Still watching what they said would happen today. So far to me, it seems a little vague. In its vagueness it is correct, but it has yet to help me with the entry. Only one day into the trial.... sitting and watching.
The Taylor Trading Technique was invented by George Douglass Taylor back in late 1940’s early 1950’s.
His Technique is a short term method to trade the inherently choppy nature of the markets. The easiest way to understand Taylor’s “structure” of a 3 Day Market Cycle is to adopt his view of the markets as being driven by the large manipulators or the “Smart Money”.
His core premise was that the market was not only manipulated, but it was manipulated in stages. These stages repeat over and over again in a few different ways that can be categorized. The structure of his 3 Day Trading Cycle is
1) Buying
2) Selling
3) Selling Short
Accordingly, each day of his 3 Day Cycle had a name: the “Buy Day” or “BD”, the “Sell Day” or “SD” and the “Sell Short Day” or “SSD”.
Taylor quantified the market by keeping a detailed “Book” which measured the moves and the measurements were entered manually.
Taylor would specifically quantify: - Rally from the Buy Day Low to the Sell Day High
and - Decline from the Sell Short Day High to the Buy Day Low.
Taylor believed that one could interpret what the big manipulators were doing by watching Highs and Lows across days.
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hi rich - thanks for stopping by and taking the time to answer our questions about the ttt - i believe the ppl that had questions have broken for lunch now - maybe you could monitor this forum to see if they come back and ask questions
Today is a Buy day and as mentioned earlier we were to expect a Decline. Yesterday the SS day close on the highs, therefore the decline was not started. In cases like that then we expect a test of these highs before the decline starts.
We also know that ES has a 93% chance of having a Decline on Buy days, even if the Decline is as small as 1 tick. So based on that information it was appropriate to find any excuse to short at or near the open. In the case of ES I had fib at 1047.66 which provided a good entry area for shorts.
In bullish markets, declines can easily be smaller than average and this morning was no exception. Markets retraced 50% and the rally started.
Please feel free to ask questions and I will drop in from time to time to answer them
Thank you for inviting me to join this thread.
Hi Richard - I am doing the trial of your service. Was just curious that this rally on the BD means a SD rally has begun? and perhaps a decline from tomorrow's projected high is highly probable? Thanks in advance!
Thank you for trying my products and I hope you can find the tool as usefull as I do.
Yes the SD rally as begun this morning. As we all know markets rarely move steadily in 1 direction. If we were to close as the current level, we probaly have only done 1/2 the average rally. Sell Days can often be what I call confusing days. By that I mean up down up down etc.
So when we are in the middle of the road like that then it is normal to get a confusing day. If we had closd on the low of the Buy day then it would be much easier to say yes we will go up most of the day on the sell day.
Today is a Sell day. On Sell days we should expect a rally from the Buy day low.
Yesterday the decline was small, pointing to a bullish market.
Today ES gapped up at the open and never filled the gap therefore putting TVGR in effect.
TVGR has nothing to do with Taylor and TTT but I found that this rule is very strong.
As we can see on the chart TTT MA D (average rally MA recap) at 1054.90 did offer some resistance and also the 1062 area and that was TTT MA p (average penetration MA recap). The Black lines above if reached, should most likely cap today's rally.
Here is an explanation of TVGR written by Trader Vic
The Trader Vic Gap Rule (TVGR) "If there is a gap, and it is going to reverse, it will do so 10-15 minutes after the opening 95% of the time. Please believe me on the odds, they are real. If the market continues in the direction of the gap after 10 to 15 minutes, it is a strong sign that the move will continue for the rest of the day, closing in that direction as well. Even if the market reverses after the 10-15 minute period, if it fails to fill the gap, odds are that the market will close in the direction of the gap." This Rule is cited from Victor Sperandeo’s book: Trader Vic II: Principles of Professional Speculation, pg. 231
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I have heard of one strat that fades the gap at the open on ES, but like you said I try to avoid the fades. Interestingly enough, I attempted a long on ZN today...Wasn't successful and I followed all my trading rules. Anyway, hindsight is 20/20. If ES opens long ZN tends to move in the opposite direction. So Trader Vic's gap rule follows all instruments it appears?
I have heard about this concept in various forms. One way too is to see where the price is 45 or so minutes after the open. If price is higher than the open at that points, chances are price will close higher at market close.
yes I usualy give it the 1st hour before making decision on that. then if we brake the high or low that was formed by that gap it will most likely continue in that direction.
Like today once we got above 1053.25 then TVGR was in effect.
I also found that if you get a double top / bottom before lunch then it may reverse and close gap.
That is just one more tool in the box.
Email me and I will send you the FREE Guide to trading TTT which also include a section on TVGR with examples.
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I am wondering -- is there an indicator that will signal which type of day it is? I'm not sure if this can be measured client-side or if it would need to pull from a customers-only server side data feed, but I'd like to see it in indicator form because I'm always looking to backtest methods.
I am definatively not the programmer you are but I dont think that TTT could be programmed to run fully on its own.
At the moment the indicator that I have for NT takes the data from the daily report, that you recieve as a subscriber, and places the type of day and 8 or 9 different TTT levels on your chart.
Picture says a 1000 words.
If you think this can be improved on please let me know.
Thanks for sharing your techniqe, thats really amazing. Your charts shows that really we are missing some thing while making trade decisions. I would like to see some more images.
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fellow traders - i'd like to share a tidbit with you that ive traded for many years - it has to deal with quadruple witching - the monday of quadruple i go long - go and back test it and prove me wrong - many reasons as to the whys but too lengthly to discuss/get into now
this post is kinda like letting the cows out after you close the barn door but nonetheless usefull info to keep in mind for the next witches
ciao
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On Sell days we are to expect a Rally from the Buy day Low. Today ES did produce a nice gap down below the Buy day Low and a great opportunity to go long with very high odds of success. We also had divergence and wave C was 100% of wave A
ES had also reached the average violation levels and reversed to close the gap and so far got back above the BdL
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Today CL is on a Buy day. On Buy day we need to get a decline from the SS day high.
As you can see CL reached the average decline levels and continues to test these levels before the rally can start.
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By the way if some of you wonder what these Labels mean on the charts here is the list
TTT MAp is the possible Penetration based on the new Moving Average Recap sheet TTT MA is based on the MA recap sheet and represents either the possible Decline level on a Buy day, possible Rally level on Sell day, possible 3 day rally on SS day TTT MAv is the possible Violation based on the MA recap sheet TTT p is the possible Penetration based on the regular Recap sheet TTT is based on the recap sheet and represents either the possible Decline level on a Buy day, possible Rally level on Sell day, possible 3 day rally on SS day TTT v is the possible Violation based on the regular recap sheet TTT PH is the Previous day's High TTT PL is the Previous day's Low shown on Buy days and SS days TTT BdL is the Buy Day Low shown on Sell and SS days
If you look at the report line 17 (see picture)you see that during the last 20 cycles we had a rally 90% of the time. I we look at other recap which has data since Jan/2008 then it is 93%. So you can see that even when we had this bear market for 1.5 year we still had rallies on Sell days.
By the way as long as we get tick above the BdL it is considered a Rally.
We can also see that the average raly is normaly more than 1 tick.
I recieved a very good question by email today and thought I should share it with you all.
Hi Rich
Trying to get to grips with Taylor once again - your ebook has been enlightening.
I still struggle with an area I had trouble with on previous attempts at TTT - determining an uptrend from a downtrend (bull and bear) and what to expect on the different days when bears are in control.
I get the impression from your email commentaries that you may understand this - if there was any chance you could write a short document outlining your approach or point me to a part in Taylor's book where he might discuss it (I could never figure out how he determined the Uptrending areas and Downtrending areas in his "book" despite reading a few times).
Any enlightenment would be appreciated
Thanks.
Hi
Thank you for your comments on the E-book.
The way I see things, TTT has a standard basic pattern. Buy day we get a decline, Sell day a rally, and SS day continue rally and start the decline.
That is the perfect world. I also find that Taylor's comments were based on a more bullish than bearish market.
However it does work in both direction as evidence by my finding of the Positive 3 day rally even in extreme bear markets.
Now how do I figure out if we are in Bull or Bear trend. There is a few telltale signs that may help.
Bullish trend: Lite or no Declines on Buy day.
More occurrence of Penetrations vs Violations.
Above average Rallies
Above average 3 day rallies
Nothing to do with Taylor but more and larger gap up
Bear trends: Lite or no rallies on Sell days
Failed 3 day rally ( Big red flag)
Below average Rallies and 3 day rallies
Above average Declines
More occurrence of Violations vs Penetrations.
Nothing to do with Taylor but more and larger gap down
This is the things I use in making my comments. Also Sell days are often confusing in nature and by that I mean up and down days. As they try to confuse us as to direction.
Also, although I don’t consider myself an Elliot Wave expert, I do try to keep an eye on the wave count and that helps me with the big picture. I have found that EW and TTT does have a tendency to work well together both on the short and not so short term.
I hope that helps.
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Rich could have not summarized TTT rules better than he did in the previous posts. I also took a little time to read the TTT book which is quite boring...but it is attached here for anyone's reference. But above guidelines are pretty much the summary of the book...
Hello i would like ot share some interesting ideas about the Taylor Trading Technique i also currently found a
way to describe it in a automatic trading system for amibroker. I found the easylanguage code for the Taylor Trading System invented by Murray A. Ruggiero Jr in the book Traders` Secrets Psychological & Technical Analyses.
Which is a very rich book because it discuss both the systems of individual traders and there psychology.
Thanks to big mike for making a webinar with Adrienne Laris Toghraine, which made me interested in her books.
Ok so i will just post the source code for amibroker.
Maybe somebody can test it, to validate if the results are feasible right now they are just to amazing.
Maybe i have done something wrong with the system logic. I will check that and keep it updated.
Oh forgot to say i will code it in Multicharts.Net also just to test it with a second platform.
Right now it is working on daily data i will also try to code some intraday entry and exit strategies using the posted system as a daily trigger
for intraday decision.
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i have now uploaded a very rich commented source code. It even has a
license text included to prevent me from being liable to damages the code could cause.
It also says that i should be informed about experiences and improvements of that piece of
code.
I have another question are you still using the TaylorTradingTechnique sheet from that vendor.
I am in doubt that you are because your last post is from 2009 ?
Would be nice to read what happened to your Taylor Trading.
richbois you have my great respect i think you are doing a great job at your website.
But i am not a subscriber i only tried a demo time once so i know about your service.
I just modified my previous upload so just dowload it again and it should be commented richly.
The only thing that I dont agree with is the fact that your cycles change every time you run the program because if you have a Buy day violation on a Sell day of SS day, the next time you run your program that day will become the new Buy day. That maybe what Angell wanted to do but it is definatly not as per Taylor. His method you determine the Buy day once and it stays for ever.
Having said that if your program is making you money as is, dont fix what is not broken
By the way if you can code it for the NinjaTrader.com platform i will test it for you
indeed i agree with you Taylor seemed to never changed the cycle and in my opinion this is totally ok.
Because you have the buy day low violation rule and the short sale day High violation rule,
which give everybody enough flexibility. But i think he respected Limit days which maybe made him change the cycle.
I guess i will not code it for ninja because i am using the MC.NET platform.
But it is very easy to understand, therefore i wanted to be posted as a starting point for everybody
who like to develop a system based on taylors ideas.
By the way you are the absolute Taylor Trading Expert i think.
Do you know Murray A. Ruggiero Jr. book called Taylor Trading Methodology i tried to find it
on amazon but only found one article published by Murray A. Ruggiero Jr. Inside Advantage Maybe you can contact him at linkedin
if you are interested in his work about Taylor.
