Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Trading the SPOOs with Patrick Slevin! -- Ignore unavailable to you. Want to Upgrade?

To: Matthew L. Jones who wrote (1410)	11/23/1999 7:40:00 PM
From: Patrick Slevin	Read Replies (1) \| Respond to of 7434

Stops on the E-Mini. < 2) I'm getting bled to death on stop losses in these flat markets.> Well, first of all the Mini is more elastic than the spoo and less profitable. When you are trading the Small Contract you have to do it with an eye towards quick gains or positional profits. In other words, if you are happy with a 2 point Stop on the Spoo you might look at a 5 or 6 point Stop on the Small. <the most recent average 5 minute bar > Presume that will be broken.....place the stop higher than the last two 5 minute bars.......or 1 tick below the last two 5 minute bars....Trial and Error will tell you where that should be, perhaps it's three bars. You really have to play it differently. You have to play the Mini wider and with fewer Entries than the Spoo. You can get a point on the Spoo and make over $200 bucks net per but on the Mini you are barely making it. It's a different mindset. The other thing on the Small is that you have to use Limits, Limits for Entries and Limits for Exits. Not for nothing, but you have to stop and think about what is going on....if the spoo does a Stop Run up rather quickly the Mini is going to extend well past it. This is a result of Electronic Trading. It's going to happen, there are Stops in Place that extend past the Large..... Actually, regardless of what conventional wisdom is, there is a group of failed Pit Traders that do this because they can.......jam it higher on the mini or jam it lower. I know you are going to run into people that say there is no manipulation but consider this.... It's a sideways market and there is a hundred on the Bid at 1414 and an offer at 1414.20-----You are a pit trader and you bid 1 at 1414.10 The person with a hundred has to shut down and perhaps the market moves to your 1 by whatever at 1414.30----stopping out whoever is at x.30 Now, you or someone else goes to 1414.20 and the other side goes to 1414.40 stopping whoever is at 1414.40 Do you follow me? The Hundred Lot at 1414.00 is ZotsKazoo. They are running the Stops up, and whammo, back it comes. The Mini is more Elastic so when the Bid ran to 1414.25 the Stops at 1414.75 are getting hit even though they are 0.75 ticks away from the real action. The follow through is that the domino effect topples more Stops higher up while the spoo stops. So your Mini Stops have to be placed further away from the action than the Spoo Stop. Anyway, if you do not follow my train of thought the Long and the Short of it is merely that you have to enter better and use looser stops when trading the Mini than when you are trading the spoo. That's all I'm driving at.

To: Matthew L. Jones who wrote (1410)	11/23/1999 8:01:00 PM
From: Gary E	Read Replies (1) \| Respond to of 7434

Matt, Please read the prior post from Pat.... Did you read my writings for this afternoon ? I certainly managed to screw up today. Hal

To: Matthew L. Jones who wrote (1410)	11/23/1999 11:12:00 PM
From: ynot	Respond to of 7434

try modelling the average duration of a sideways market and the 'amplitude' for both daily and hourly bars do same with spoo and find one contra indicator which goes in opposite direction to the small/spoo overlay the charts and see where everything crosses, top+bottom and where the contra indicator goes to opposite extreme if i had the time to do this, i would place my orders at the open, complete with stops and just wait--one order for the top, one for the bottom i am scratching my head about a leading indicator for the spoo, maybe a hot stock or two in the index? like a temperature guage? i am fiddling with candlesticks, forks, delta/gann, but no time for serious statistical/leading sentiment guages, yet :) back to my cave ynot :)