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Welcome to this new thread, where we can share trading ideas and our thoughts on the Taylor Trading Technique.
Anyone with questions on TTT, this is the place.
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Originally posted by rigel It doesn't need to be a nuclear crises to cause markets to overshoot the levels, if you remember when the market turned in 2007-8 we had 1000 point day on the YM. I am sure that Taylor must have seen his share of crazy markets. Let's not forget he wrote his book in the late 1940s and I am sure his study was not just based on a few years of studies, therefore must have covered part of the period during WW2. I dont know this for a fact but it would be a reasonable assumption.
Plates reproduced in Taylor's book date back to 1933. Exclusively, ticker "X", US Steel. It would appear he traded that stock over and over from 1933 to the book's 1950 publication.
That's one stock, with one NYSE specialist and trading with pencil & paper (as opposed to E-mini's with pre-market, ECN's, a myriad of global participants, and............technology). Sorry, but "things" don't repeately conform to a nice neat 3 day cycle. Although an approximation can be made by re-synchronizing at a 10 day LLV (per George Angell). In this the interest of clarity, here's a simple matrix" irrespective of B/S/SS "days": BH/HMF.................Short BH/LMF.................Hold All Day BU/HMF.................AVOID BU/HMF.................BUY It should also be mentioned prices don't always reach a Buy High or Buy Under (ie inside days). Originally posted by efficiency I must admit I never noticed the date on the US Steel chart but yes` they go back that far back. I never realy paid much attention to his stocks trading and concentrated more on his Futures trading which was more on commodities. As far as changing cycles like Angell does I am convinced that it has nothing to do with Taylor and I dont agree with it. Yes it is a lot easier to modify the cycle than to study the TTT method properly. But to each his own. I have not changed my cycles in 3 years and they still work.
Agreed, Angell and Taylor never met. Publisher included Angell's LSS method in the back of the book.
That said, to reiterate, prices don't necessarily conform to a nice neat 3 day cycle. The overall market, comprised of numerous specialists/market makers are always going to either dispose of inventory or..........re-accumulate invetory. When necessary, theses processes extend beyond a B/S/SS cycle. Human nature hasn't change but technology certainly has. In 1950, "they" weren't called futures and certain instruments, such as Treasury futures or Index futures, did not exist. IMO, the book was geared toward equities, demonstrated by USX. Additionally there seemed to be more emphasis on measured moves with the 3 day cycle, described later, as an alternate method.
Adhering to a 3 day cycle (rather than measuring highs and lows between days), AND IF you start with a 10 day low at random and count forward B/S/SS, that sequence will not stay in sych, and thus have to be re-synchronized.
Originally posted by efficiency yes if you keep looking for the lowest 10 day low and think that way then yes the cycle would change. However that is not what Taylor did. In his system he said that once the cycle is established it does not change. In my case I back this up by using a Positive 3 Day Rally having the highest ratio and with the instruments I trade and follow they do keep a ratio above 85% and that proves the point of manipulation Originally posted by efficiency All i can say is that i follow mainly Futures of Indices and Materials, FX, also FX cash and some stocks. TTT is working perfectly on all of them. As far as the cycle being out of sync, the idea is to learn to trade TTT with what you see and not what you think it is suppose to be. We could be 3 persons and all 3 be on a different cycle and all trade it properly for that day. I found that by adding the Positive 3 day Rally ratio criteria to the rules of finding the start of a cycle a great advantage and the cycles seems to work the best that way. As far as stocks are concern I find that some stocks are related to a parent instrument and that also has to be taken into consideration. IE: DIA is related to the DOW and the DOW is related to YM the future for DOW. Special modifications to keep the cycle in sync need to be made to the DOW numbers and therefore to the DIA when we have special holiday.
One more thing I did is stop using the BU BH and the like as it was confusing every one. I now just use Penetration and Violation for the 3 days that makes life simple
Originally posted by Richbois Rich , can u explain this ? Originally posted by aincas Part of the discovery I made when I started my 1st trading book on TTT is that there was many calculations that could be made based on what Taylor was saying and that was not in his trading book. One on these calculations was the 3 Day Rally numbers as per Taylor but also i found that most of them were Positive. Dont forget that when i started my TTT we were in the major correction of 2007-2009. So even in a real bear market the positive 3 day rally ratio was over 85% which in my opinion does prove what Taylor always claimed, The Markets are MANIPULATED. So based on that discovery, when i start a book on a new instrument, I make sure I use more than 10 days of data, and usualy the low for that period will also coincide with the best positive 3 day ratio.
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