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Pyramiding Positions
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Pyramiding Positions

by The MoleJanuary 23, 2011

Now trend traders often pyramid their positions, so that means that once a trade is going in your favor you add another ‘unit’. Again, I do that by using a multiple of my risk exposure, which in turn was defined by ATR. You can of course use an arbitrary stop in which case you use multiples of whatever your entry/stop delta comes out to. Some trend traders add up to three or four units and you should really count your blessings at five units. As you can imagine calculating this entire scheme gets rather complicated quickly and use up a lot of your trading time. And that brings me to your new favorite toy: Bernie’s Pyramid Calculator (BPC) – a trading tool exclusive to Evil Speculator subscribers:

If you are a subscriber you can click on the image above to get to the BPC – it’s also available in the menu bar on top.

I have set the entry price here to 128, just like in Scott’s setup in my first chart. Not to beat a dead horse, but in order to use this tool you need to first figure out how much you want to lose on each position. And I phrase this intentionally that way – when I enter into a position my base assumption always always is that I am wrong. That affords me the luxury of staying cool when my stop gets hit and to be happy when I wound up being right. When it comes to calculating your risk my tip would be define your risk exposure in the BPC first and then to use to TOS simulator to calculate how many shares or options you can buy/sell based on your 1% risk rule. If you use a 1N stop you can obviously get into more positions than with a 2N rule – this is all up to you and maybe I will cover this topic another time. I know it all sounds horribly complicated but once you’ve done it once or twice it’ll become second nature.

Now, the first thing you do is to add the symbol for posterity’s sake- the script automatically puts it into upper case. Then you enter the ask price and if you want you can also name the trading system use for this position (always helpful a week later if you’re suffering from ADHD). Next you use the daily ATR of the particular symbol to define your stop – I usually use a 14-day ATR – but 10 is fine in more volatile times. The rest happens automagically – you immediately know your first stop without having to resort to complex trigonometry and even your entry day stop at 0.5 x whatever your N is, if that’s part of your system. Even better – you also get your future pyramid triggers and you can add those as timed entries (price trigger and time) in ThinkOrSwim.

When I take a position like this I usually also use jing to produce a screen grab of my trade. That’s why I also added the date and time on top of the BPC, it tells me exactly when the trade was taken. You can either print it out or add it to your private trading blog – I personally prefer latter. What happens next is up to the tape. Either you get stopped out and you’re done, or the tape moves in your favor and that means you have some work to do. You can either trade each additional unit manually or do it via triggers in TOS – there are pros and cons to either. I like to do it manually as I also consider the velocity and ‘feel’ of the tape – but if I’m honest I need to concede that I often slept through adding additional units.

And there you have it. Pyramid trend trading made easy – even for the mathematically challenged. If you look at the SPY chart above you see that the 1N stop used in the example came out to just where we would want it – below the 127.13 prior low at 126.9. I prefer that to 127 as integers often get hit in stop sweeps. Even when I take discretionary trades I prefer to set my stop at non integers.

Again, the tool is exclusive to subscribers and I hope that all of you stainless steel rats will find it to be a welcome tool in your trend trading arsenal.


About The Author
The Mole
Mole created Evil Speculator amidst the chaos of the financial crisis in early August of 2008. His vision for Evil Speculator is a refuge of reason, hands-on trading knowledge, and inspiration for traders of all ages and stripes. You can follow him and his nefarious schemes at various social media waterholes below.
  • http://practicalt.blogspot.com/ Gold_Gerb

    football? who has time for football?

    given market conditions, I would say there's no more bears fans.
    http://t0.gstatic.com/images?q

  • convictscott

    Some clarification. The swing low setup on Thursday, hasnt failed (the stop is *1 tick below the low* , but hasnt worked yet. And we have a sell setup. So the evidence is very mixed. I exercised some discretion since I have no confidence in either direction yet and jumped out for a few ticks of profit.

    In some ways I hope we make new highs, because at that point I would have A LOT of confidence in a top being in.

    FX and metals are so much easier atm.

  • convictscott

    That pyramid calculator is SUPER COOL. I'm going to test it out on metals if they drop hard this week

  • convictscott

    I did some quick checking and it appears that entering on close (instead of waiting for confirmation) and using an ATR based stop may be better

  • http://evilspeculator.com molecool

    😉

  • biowolf

    Well, what the fluck is going on here. All of sudden the site is on fire.and you are getting into currenies !!! Great technicals on the Euro and the Yen. BTW John Paulson said the money will be in currencies. Of course he also is into BoA.

  • http://evilspeculator.com molecool

    Did everyone die?

  • Hungry_Joe

    Nope. Just waiting, I guess, for something to happen. And Mole, looking forward to your Zero for Fx.

  • http://evilspeculator.com molecool

    Nice move in the AUD/CHF.

  • http://evilspeculator.com molecool

    AUD/JPY on fire.

  • mothwhoflysbackwards

    No, it's Bear fans refusing to ever talk to you again! Duuuuude, of all the teams you coulda picked …. the one made up of cheese eating hicks? I am sorry but honor demands that I hate your guts. Your're gonna have to do some fancy charting to make up for this one. Ex stassi (?), stripper spanker, psyco– rammstein cranking — driver, and by god man I didn't re up my subscription quick enough for you and I think you killed a puppy …. that's all cool , but this packer crap is one toke over the line sir, yes one toke over the line.

  • Darkthirty

    the POTUS was supposed to show, Chicago being his home ghetto,odds were on the rig for a bears win, the money was made on the fade. Ya gotta understand chicagopolitcs/mob

  • http://chartsandthat.blogspot.com/ ultra

    Great post mate. Never mind AUDJPY, this place has been on fire of late.

    Currently long USDJPY based on the 4 hr from last night, was in two minds whether to can it this morning but set the stop to breakeven and let it run – not exactly setting the world alight though, very much still an inside day on the daily right now.

    Will see what happens after the US open – will cut it loose if it breaks the current hourly uptrend I think.

  • Brishort

    Mole and Scott,

    Thank you for all those nice posts recently. A little behind in my reading but enjoying every single bit of it. As I understand more Scott's approach to trading, hopefully I can contribute to what he writes as well.

    Mole, those Zero reviews and Geronimo are great! Learning and considering Geronimo, at least to give it a try.

    Scott, keep those posts coming. I have to say I am still in the learning curve of you method. Although I understand what you are doing, the trading using these tools is not native to me…. yet.
    Therefore I have provided very little feedback, but just wanted to make sure you had a thank you note herein saying how much it is appreciated.

  • raised_by_wolves

    That Bernie Pyramid Calculator of yours looks sick. Would you consider using it for options trading?

  • captainboom

    I am also interested in using it for options. Thoughts?

  • raised_by_wolves

    Hey Brishort, have you ever tried charting $SPX:$USD? (You may need different setting than $SPX:$VIX).

  • raised_by_wolves

    While my risk/safety ratio looks embedded, I'm going to continue to take sell setups using risk assets.

    http://content.screencast.com/

    Silver has been great for shorting based on relative weakness. I sold all my February SLV puts this morning, however, when a there were a series of volume spikes along with a triple bottom formed on the 1 minute silver futures chart.

  • raised_by_wolves

    AUD/JPY seems to be following a pattern where it spikes higher and then moves sideways with a downward spin for a month and then spikes higher again and then moves sideways with a downward spin for another month. . . .

  • raised_by_wolves

    Most of the AUD/other currency pairs are below SMA(20). Some, like AUD/JPY and AUD/USD, are just below it and threatening to move above.

  • EvilTrader

    I wonder why americans call this game football, since its 99% of the time played with the hands. Only the field goal is actually a kick.

  • tradingmom

    anyone having zero problems?

  • Battlezone

    hey, is the zero frozen? it's not updating for me in firefox or chrome, my network is up though.
    both the Zero page, and the zero.png appear frozen.

    thx!
    BZ

  • captainboom

    My last update was 11:22 NY time.

  • Battlezone

    I should clarify, it was working fine until 20 minutes ago, but is now stopped.
    BZ

  • http://iberianviews.blogspot.com/ catracho

    comes from “Rugby football” ..proper name for Rugby..

  • amokta

    I am struggling to make sense of the Difference Engine/Abacus (BPC) – all this pyramidying is making me walk like an Egyptian. Anyway, would a more basic approach be to watch the tape and add additional positions on 'pull-back' to 20day MA or something? (why would the BPC confer a market-edge – i know it uses the ATR in the calc, but still?)

  • raised_by_wolves

    Association football (soccer), rugby football, and American football (gridiron) share a common heritage. They are all examples of football games.

    http://en.wikipedia.org/wiki/F

  • http://evilspeculator.com molecool

    My Internet was down for the last 30 minutes – fixed now.

  • raised_by_wolves

    Hopefully Mole will comment on BPC possibly conferring a market edge. I will point out that BPC gives you a consistent method of pyramiding and setting stops. That in itself is a big improvement over having no consistent method at all, eh?

  • http://evilspeculator.com molecool

    Internet was down for about 30 minutes – sorry, guys. It's all fixed now.

  • http://evilspeculator.com molecool

    Because mathematically it allows you to add to a winning position at no cost 😉

  • amokta

    True – sometimes its better to have a consistent sytem (which will work with the trend in any event), so as to avoid errors etc

  • raised_by_wolves

    Also, I suspect that with BPC providing unique, non-integer numbers, it may be less preyed upon by stop-breaking predators.

  • Battlezone

    Yep, working here. Thanks!

    (I missed the Zero like my mammy… 😉

    BZ

  • raised_by_wolves

    Watching silver is making me laugh because when SPX moves up a lot, it moves up a little or sideways and when SPX moves up a little, it moves sideways or down. If, hypothetically, SPX were to move down. . . .

  • raised_by_wolves

    Yet another example of shoddy infrastructure designed to create artificial scarcity.

  • raised_by_wolves

    From Slashdot; by GNUALMAFUERTE:

    “I can't believe it either … but there is a whole industry dedicated to dealing with windows. But it's the way our world works, sadly.

    “We create artificial scarcity, force people to use an inferior and limited technology, that has ridiculous drawbacks, and requires a tremendous workforce around it just to keep it functional. And we keep people using it even when there are cheaper, infinitely better, more reliable and future-proof technologies. The reason is simple: Through artificial scarcity, we keep the money flowing in a certain direction, we keep control in the same hands, and we create hugely profitable but completely pointless industries.

    “Think about it, we could be running 100% on clean, future-proof, secure and cheap nuclear energy. Instead, we rely on oil. The infrastructure that oil demands is huge, the drawbacks are incredible, we are polluting the environment, drilling the oceans to get some more black juice out of the earth at a huge risk.

    “We could also have moved all of our communications to ip-based networks, cutting down costs, and removing the need for so many different networks. We could have a single infrastructure that would provide us with high-bandwidth, low-latency internet everywhere, and put everything from phone calls to TV through that network. Instead, we are running different networks for each purpose, and within each purpose different networks for each provider. If we re-purposed all cellphone towers from all providers to give us just internet access, we could have 100% coverage everywhere in the world. Instead, we have huge overlapping (areas serviced by several providers), and huge areas with no coverage at all.

    “We could also be using just Free Software. It's open, transparent, reliable, cheap, and ethical. Instead, most people use windows. That means triplicating new hardware purchases, cutting 70% on hardware's lifespan, spending incredible resources in pointless activities like antivirus production/sale/deployment, and an IT structure several times bigger than required, not to mention all the lost time and profit due to preventable downtime.

    “But it's the way the economy works. It's the way the usual people keep getting richer, while keeping the majority of the world in line, quite and productive.

    “It's absolutely sad, but it's not just something that happens only in software, and it's certainly no accident.”

  • captainboom

    Link? I like it.

  • raised_by_wolves

    That was someone's rant, tangentially related to the subject of the new Intel SSDs shown at CES (where I think Mole was showing off an evil invention of his own).

    http://hardware.slashdot.org/s

  • raised_by_wolves

    If you haven't already, watch “Awakening” after market close.

    http://www.youtube.com/watch?v

  • Darkthirty

    Tesla had wireless electricity transmission, couldn't bill for it

  • amokta

    Ok (again i dont know why i am asking questions – i am not at the stage of pyramidying yes!)

  • raised_by_wolves

    So there is a technology paradox where as technology improves, there is less and less need for workers. Now technology has advanced to the point where society could restructure so that everyone harvests their own food, everyone collects their own energy, and everyone produces their own products using universal assemblers. While the average person would enjoy a much higher standard of living, the elite of the current system would no longer have their status and privileged place in society. The Zeitgeist movement advocates democratizing resources and the means of production so that this restructuring can happen. You may be thinking that is a radical, utopian, and unrealistic approach. Radical and utopian it is. Unrealistic? It is more realistic than continuing the current system where money production and industrial production are monopolized by a few. Basically, the current system has always been dysfunctional but is now more than ever in danger of failing. It depends on planned obsolescence and blowing up stuff (the ultimate planned obsolescence). Producers have the technology to make products that endure more than a lifetime but making those would bankrupt them in the current system. In the utopian system I just described, there would be no such thing as bankruptcy, profit or loss, or parasitic compound interest (yes, we traders are parasites . . . I like to think of myself as a parasite on the parasites however . . . I like to think that I take advantage of Goldman Sachs and not the average person). There would still be materialism, potentially a much higher level of materialism (it would be smart materialism where the products you build for yourself are meant to last and there is far less waste).

    One radical approach (the one I just described) or another (the one I'm about to describe) will have to be taken.

    Personally, I think the radical approach that will be taken is one where the workers are killed off through world war and mass genocide. The fact is that this radical approach was already prototyped in the twentieth century.

  • http://chartsandthat.blogspot.com/ ultra

    Turkeys don't tend to vote for Christmas very often.

  • http://chartsandthat.blogspot.com/ ultra

    Silver weekly – inside week this week (so far, it is only Monday, mind!) – I am looking at how the Bollinger has levelled off and thinking that I have seen many times this kind of pattern where price, previously embedded, corrects in a kind of w4 and then goes for one last breakout through the now flat upper Bolly, thus screwing the too-keen shorts.

    So watch out for the possible bounce off channel long trade:

    http://tinyurl.com/5vv9hsn

  • rg64

    Wonder what STU is thinking today?
    Needs to get out the Dow 12,000 hat!

  • Battlezone

    My new BFF the Zero got me onto that VWAP reversion at the top, and then it got me back off it when we spiked back up. Sweetness. BZ

  • ds2

    OPEX over – POMO ramp continues. My charts all look to be back on course except the RUT. RUT could be a good buy.

  • raised_by_wolves

    The utopian society I described probably could work. It is essentially the pioneering model but instead of pioneering “new land” (the American West could only be considered new land if you ignored the the displacement of Native Americans), people pioneer new technology to use existing land much more intelligently.

    But, yeah, it's very unlikely to happen since the wolves control the destiny of the sheep, right? So, surplus workers being killed off is what we should expect for the twenty-first century. Despite my username, I may be among the sheep lead to the slaughter. If there is a just God that judges people when they die though, it is worse to be a wolf who slaughtered the sheep (the hell burns hotter for Hitler idea).

  • http://chartsandthat.blogspot.com/ ultra

    Perhaps I should point out that Thanksgiving & Christmas do still seem to roll around every year – without the consent of the turkey constituency.

    But yeah, bad analogy – Christmas is as we all know, for the turkeys, something of a black swan – whereas the centuries-old elite are well aware of what fate will befall them should enough people cotton on. There is a great quote (perhaps apocryphal) attributed to Poppy Bush that goes along the lines that if the people of America were aware of the things that he had done he would be driven through the streets and lynched.

  • raised_by_wolves

    Hopefully I haven't distracted everyone from noticing the retest going on right now on the 4 hour chart. Spike high. Lower close. Higher closes. New highs look probable. But if not, you know what.

    http://content.screencast.com/

  • raised_by_wolves

    “It is well that the people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning.” — Henry Ford

  • http://chartsandthat.blogspot.com/ ultra

    Maybe now that people have taken to getting the message out in cartoon form (lol) people will take note. Maybe.

    But so long as there is money in the ATM (check) and food on the table for most (er..) things should carry on truckin' along nicely.

  • http://chartsandthat.blogspot.com/ ultra

    already on it and getting bored waiting for the breakout..

  • captainboom

    Does anyone know if it's possible to extract and save the data used to create a ThinkorSwim chart? i.e. I'd like to be able to save data to a spreadsheet for further analysis. Option data in particular, interests me.

  • bshah

    i think 12000 on DOW is inevitable … and earnings week is easy help to achieve that.. so i am not hoping any red day for next few at least.. and given this is the busiest week of all, forget it..

  • mothwhoflysbackwards

    Mole's BPC looks very sophisticated, but the concept of pyramiding is simple. I know it must be simple because I think I have done it! Say you buy x amount of shares, they go up a dollar, then you buy another x amount and set a stop at B/E which would also be your new cost avg. half way between the two buys (.50 less then the 2d buy and .50 over the first). Just add to a winning position and set a stop at B/E. That explains the “add to a winning position at no cost.” Yeah, what I do is pretty half assed compared to the BPC, but lets start one cheek at a time.

    In other words keep an eye on the simple concept before you try to build it up, I know that helps me. (note to Mole/community: if what I have described above — adding to a winning position and setting a stop at the cost avg B/E — is NOT the bare bones of pyramiding– please let me know).

  • raised_by_wolves

    Technically, the breakout (sort of) just happened (right after you posted) with SPX making a new high for the day that exceeded the previous spike high. However, there hasn't been much follow through yet.

  • raised_by_wolves

    If SPX could just go sideways instead of up, then silver could still crash. :-)

  • raised_by_wolves

    AUD/USD and HG/$DXY haven't confirmed.

  • raised_by_wolves

    That's a good question to which I don't have an answer. If no one answers you here, email support at thinkorswim dot com.

  • raised_by_wolves

    I'm watching this trend line on silver:

    http://content.screencast.com/

  • Turps

    there goes Silver

  • raised_by_wolves

    😀

  • Joe_Jones

    About to say it!

  • http://evilspeculator.com molecool

    Good for you mate :-)

  • http://evilspeculator.com molecool

    Actually you are doing it the hard way. If you use the BPC all the calculations are done for you – it's simple.

  • http://evilspeculator.com molecool

    I was merely trying to tie into Scott's posts on trend trading.

  • raised_by_wolves

    Valor, er Volar, where art thou? I want to compare ratio charts.

    (SLV*47+GLD*10)/($SPX)

    http://content.screencast.com/

  • raised_by_wolves

    Clearly POMO money isn't going into silver. 😀

  • Joe_Jones

    WTF: 26.87

  • Joe_Jones

    ES is following silver!

  • raised_by_wolves

    26.26

  • volar

    I have been using tradestation.. what a f******* pain in the asss… who would have thought one can not get a regular nearby futures contract…WTF

    anyways..

    http://content.screencast.com/

    metals are $SPX's bitch right now

  • raised_by_wolves

    That's the tail wagging the dog. :-)

  • raised_by_wolves

    What's the probability of not retesting your broken trend line?

  • Joe_Jones

    Somebody tripped on the Short swift in the HFT's room!

  • raised_by_wolves

    Volar, remember what you were told about swearing? You must use the full swear; no self-censorship.

  • http://chartsandthat.blogspot.com/ ultra

    Now I'm trying real hard these days not to be a beartard, but charts like this really don't help matters…

    http://tinyurl.com/5t8gz4w

  • Joe_Jones

    Don't worry, Bernank has everything under control, just BTFD and stop making silly comments!

  • BobbyLow

    Afternoon folks.

    Been gone most of the day. Just got back in time to short a little GDX (Gold Miners). I should have (Coulda, Woulda, Shoulda, Shorted this $5.00 Per Share ago during the first week in January. I can't believe how far I had my head up my ass on this one! BBands are opening up wide and headed down. I don't think I'm too late and if I am I'll stop myself out. If it continues free fall, I'll Pyramid. :)

  • http://chartsandthat.blogspot.com/ ultra

    Whoo thanks man – pulled me out of it just in time..

  • raised_by_wolves

    Yes, but also sell every precious metals rip. Dow 30,000.00 and silver 2.00. 😉

  • Joe_Jones

    Yeah! What's the point of holding a barbaric relic!

  • raised_by_wolves

    You're not even joking, are you?

  • raised_by_wolves

    Silver is the only risk asset I follow that is in negative territory today. Gold and the dollar are negative, but those are safe havens from my point of view.

    http://content.screencast.com/

  • skynard

    cmon Dow 12K!

  • Joe_Jones

    BTW, Disqus sucks blocks! Makes new post even when pressed reply.

  • volar

    hell if i know. I view this as a turning point. but to put things in perspective.. here is that chart weekly

    http://content.screencast.com/

    hell we go go to 1.00 before it looks like a real move 😉

  • raised_by_wolves

    Have you updated your FireFox plugins lately?

  • mothwhoflysbackwards

    Thanks Mole, yes I figured I was doing it the hard way, but just wanted to be sure what I was doing was indeed pyramiding. Also, you can only do it the hard way if you get the basic concepts and getting the basic concepts lets you understand the BPC better. If you don't “get” the basic concept, trying to use the BPC is like trying to use a nail gun with out underatanding the purpose of a hammer or even the nails, and i was worried (but not certain) that amokta fell into that catagory.

    I have dabbled intraday, and on longer time frames IF my new cost avg is low enough to protect me from any gaps. Thanks again for the new “nail gun”!

  • Joe_Jones

    I am at work and we using IE. Retard IT people.

  • raised_by_wolves

    Going to 1.00 would either feel like precious metals crashing or equities going parabolic (or both).

  • http://evilspeculator.com molecool

    Strange – are you running Firefox or Google Chrome?

  • http://evilspeculator.com molecool

    Yeah, I never get that. They breathe down your neck and block various ports but then insist on using IE.

  • http://chartsandthat.blogspot.com/ ultra

    LOL – hey, I'm just staying open to possibilities in both directions..

  • raised_by_wolves

    The weekly BB(20) is one more red candle away.

    http://content.screencast.com/

    I wouldn't be surprised to see a reversal there.

  • raised_by_wolves

    This relates back to the artificial scarcity discussion.

  • raised_by_wolves

    Artificial scarcity in action.

  • raised_by_wolves

    On stops: The order conditions rules in TOS can be used to set the stop for options based on the underlying.

    On pyramiding: Perhaps verticals should be used to reduce theta burn?

  • raised_by_wolves

    Long IBM, short SLV?

  • convictscott

    ¤ø„¸¸„ø¤º°¨¤ø„¸¸„ø¤º°¨
    ¨°º¤ø„¸ N E W „ø¤º°¨
    ¸„ø¤º°¨ P O S T “°º¤ø„¸
    ¸„ø¤º°¨¤ø„¸¸„ø¤º°º¤ø„¸

  • raised_by_wolves

    Assuming this is a real break out and not a hell of a fake out, long IBM, short GLD:

    http://content.screencast.com/

  • mothwhoflysbackwards

    I have heard this before and wonder if the idea of technologicaly produced super abundence (as opposed to artificial scarcity) is the mortal enemy of the unique?

    If you can explain why it's not you maybe onto something, but there are only so many Jimi/Rory/Beck/Dylan shows/tickets/front row seats.

  • raised_by_wolves

    If he were alive today and you asked him which was better, the pre-commerialized era 50 years prior to his time when people produced more music themselves, singing while they worked or playing guitar on the porch at night, or the MTV era where a few people get to play on a fancy stage while most people sit in front of the tube and no longer participate themselves, I think Hendrix would say that the pre-commerialized era was better.

    Hendrix cared less about the uniqueness of himself or his brand and more about the uniqueness of music. Also, Jimi Hendrix preferred the idea of giving free concerts.

    http://www.youtube.com/watch?v

    Hendrix couldn't do very many free concerts though because (1) he had to generate revenue to service his debts and (2) electricity to power his amps wasn't free.

    In a technologically produced super abundance shared system, there wouldn't be any dollar denominated costs. As it was during the hunter gather period, costs would only or primarily be priced in calories and there would be a lot more calories available. Instead of today's easy money, you would have easy calories. Hendrix would build Electric Lady Studios without debt. And solar-battery power would provide for all his energy needs.

    Would Hendrix become famous in technologically produced super abundance shared system? Maybe not, but it was unlikely for him to have become famous under the current system; remember he may have been killed in Vietnam if he hadn't be discharged from the army. Also, Hendrix would not have gone hungry as a child, and he would not have possibly been killed by the powers that be.

    When it comes down to it, people that could make profit off of Jimi/Rory/Beck/Dylan or for that matter Spears/Bieber prefer the current system. Consider this: the current system served Janie Hendrix more so than it did Jimi Hendrix. And who are the business men who drank Dylan's wine? Did any of them know what it was worth? Only priced in dollars. They didn't appreciate Dylan as Dylan or art for art's sake, did they?

  • Battlezone

    Today is really my first day watching the zero every minute – it was helpful throughout, although I felt like a noob at times trying to riddle how it is programmed and thus how to interpret certain formations. (Let's see, if I were crafty Mole, how would I code this thing? 😉

    The most helpful signal for me, in scalpy trading, was each time a Zero spike would taper off, forming a decisive tip with plenty of time (ahead of the 'ES at least) to jump in and fade it back to the zero line, or take profits or whatever.

    I am looking to lengthen my comfortable timeframe using the Zero, but in today's conditions it seemed prudent to get in and get out more quickly, to be aggressive in taking profits as Scott advised yesterday. Still the Zero kept me on the right side of the trade. Yay.

    (I would have given my left nut to run the Zero on the /DX and the /NQ today.)

    BZ

  • amokta

    Even im not sure as to which category I fall into :-)

  • captainboom

    Thanks. I'll have a look at the rules in TOS. I use verticals much of the time, indeed to reduce theta burn.