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trueblueTEX
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Postby trueblueTEX » Sat Jan 19, 2013 4:59 pm


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Captain Pugwash
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Postby Captain Pugwash » Sat Jan 19, 2013 7:02 pm

MO said

'Position' is where ever you would place a stop on a weekly+ chart.
'Position' is where ever you would place a stop on a weekly+ chart.
'Position' is where ever you would place a stop on a weekly+ chart.

BINGO - another Aha moment.

Thankee Shipmate


Nice to see you back Trueblue - we spoke briefly under my other alias "skivers" - I also no longer scalp.

you are right -bredins done a great job of explaining stuff
"MOJO 1)Self-confidence, Self-assuredness. As in basis for belief in ones self in a situation. Esp/In context of contest or display of skill such as going into battle. 2)Ability to bounce back from a debilitating trauma and negative attitude YEH BABY

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MightyOne
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Postby MightyOne » Sat Jan 19, 2013 8:08 pm

trueblueTEX wrote:Ordered!

Throughout this past week on the EU, when, on the chart, would you have chosen a position and what would that position have been?

Have you a specific suggestion where I should go to learn about space?

I thought you didn't actually use a stop but only a 'mental' one so as not to get wicked out.

Thanks, MO!



By 'stop' I am referring to '00' or the loss of one unit of risk.

'Space' is a box sized to your minimum lot size of 4 lots (at least 3).
To find the price at which you can trade 5 lots you simply input:

(4/5) - 1 = -0.20 (the 20% retracement)

what about 8 lots? {4 / 8} - 1 = -0.50 (the 50% retracement)

what if 3 lots is my minimum size? {3 / 8} - 1 = 62.5% ret

If you place limit order on a ret and get filled then your NEW box size is from the RET price to 00 (your 'stop')

When you liquidate, your min. lot size line is the liquidation price.

If you liquidated 8 lots then you can reenter for 8 lots on your min. lot line (for now lets say that your min. size is 3 lots)
If you want to know how many lots you could then purchase if price retraced 50% to your stop, while you're flat (not in) the market, then you reverse the numbers:

(3 / 6) - 1 = your 50% retracement, your liquidation price IS the 3 line, so now if price retraces 50% then your new position size could be (you liquidated 8 lots) ---> (6 / 3) * 8

This is the basics of Space.

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Postby trueblueTEX » Sat Jan 19, 2013 9:37 pm

MightyOne wrote:
trueblueTEX wrote:Ordered!

Throughout this past week on the EU, when, on the chart, would you have chosen a position and what would that position have been?

Have you a specific suggestion where I should go to learn about space?

I thought you didn't actually use a stop but only a 'mental' one so as not to get wicked out.

Thanks, MO!



By 'stop' I am referring to '00' or the loss of one unit of risk.

'Space' is a box sized to your minimum lot size of 4 lots (at least 3).
To find the price at which you can trade 5 lots you simply input:

(4/5) - 1 = -0.20 (the 20% retracement)

what about 8 lots? {4 / 8} - 1 = -0.50 (the 50% retracement)

what if 3 lots is my minimum size? {3 / 8} - 1 = 62.5% ret

If you place limit order on a ret and get filled then your NEW box size is from the RET price to 00 (your 'stop')

When you liquidate, your min. lot size line is the liquidation price.

If you liquidated 8 lots then you can reenter for 8 lots on your min. lot line (for now lets say that your min. size is 3 lots)
If you want to know how many lots you could then purchase if price retraced 50% to your stop, while you're flat (not in) the market, then you reverse the numbers:

(3 / 6) - 1 = your 50% retracement, your liquidation price IS the 3 line, so now if price retraces 50% then your new position size could be (you liquidated 8 lots) ---> (6 / 3) * 8

This is the basics of Space.


I'm about half way through my first read of the Space Wars thread and thought I was beginning to understand Space ... until I read this. :?

I particularly do not understand this statement: " When you liquidate, your min. lot size line is the liquidation price."

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Postby trueblueTEX » Sat Jan 19, 2013 9:41 pm

Captain Pugwash wrote:MO said

'Position' is where ever you would place a stop on a weekly+ chart.
'Position' is where ever you would place a stop on a weekly+ chart.
'Position' is where ever you would place a stop on a weekly+ chart.

BINGO - another Aha moment.

Thankee Shipmate


Nice to see you back Trueblue - we spoke briefly under my other alias "skivers" - I also no longer scalp.

you are right -bredins done a great job of explaining stuff


Hey Cap'n, or is that "The Avatar formerly known as Skivers"??

Glad to be back. I hope to find my retirement career this time around.

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Postby MightyOne » Sun Jan 20, 2013 4:10 am

Lets name one end of Space '00' and the other end '##'

With a 50 pip initial space, if you went short 4 lots (your min. size) and liquidated at +25 pips then your total Space is 75 pips.

00 is exactly where it was when you put the trade on and ## dropped 25 pips; your '4 lot line' ie ## IS your liquidation price (25p lower for a total Space of 75 pips).

## can be any number, but this is how the fibs work when it equals your min. size:

04
05
06
08
12
16 lots (really 20)

if 4 (##) is some other number then:

##
## +25%
## +50%
## +100%
## +300%
## +400% (really 500%)

Lets give it a try:

4 * 1.25 = 5
4 * 1.50 = 6
4 * 2.00 = 8
4 * 3.00 = 12
4 * 4.00 = 16

Your min size is 4 units.

if your account is:
$3000 then the 4 lot line is 12 micro (3k is 3 units)
$7000 then the 4 lot line (##) = 28 micro (7k is 7 units)
$14,000 then ## = 4 mini (10k is 1 unit)

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trueblueTEX
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Postby trueblueTEX » Sun Jan 20, 2013 3:24 pm

Ok, I spent some time yesterday reading from several threads on space (Space Wars and Hang Around Lounge as well as some links to some of TygerKane's posts on it.) Then I read the above post before going to bed.

I'll have to reread it a few times. :) Not sure why 16 is really 20 (unless it is adding back in your original 4??)

Pardon me a few a questions:
The base of the box (top if shorting, bottom if buying) is your position, correct?
From the base to your order fill is you pincushion, correct? and represents your risk for this trade (eg 4.5% equity at however many pips).
Why is space a box? What does the width (thus area) represent? Is it just a convenient visual representation?
Thanks, MO!!!

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Postby MightyOne » Sun Jan 20, 2013 10:15 pm

Are you being difficult to be funny?

Yes, the 100% retracement (called 00 or the 'flat line') is your position ('stop')

For visitors: a 'pincushion' is simply the size of your stop loss.

The 0% retracement (##) is the most that you can pay to get into a trade at your smallest lot size but, after you are filled, it is equal to your current lot size and the current price (which is locked in place after liquidation).

To avoid using a moving box, you can set ## to a planned limit or stop order.
Say that you purchase 4 lots so that the ## is moving up and down with price, what happens if you add 2 lots?:

(4/6) -1 = the 33 RET (the 6 lot line or ## + 50% line)
since you added at the ## line, instead of the 33 ret, the 33% comes off the top so your position drops to the 66 ret line which is now 00.

You can also plan a trade so that your position drops on the extreme:

When you see me replace the 00 with a ret line, it means that I plan to buy less on the ret and drop my position to the extreme as price moves in my favor.

The Fibo RET tool allows me to plan trades/adjustments on the fly without using a calculator

(Space Wars, armed with the ultimate computing power of an abacus!)

It is unlikely that you will ever use the quintuple line:
Its location is at (4/20) - 1 or the 80% ret.

I changed the number of lots to quadruple ( ## * 4) to make sure that I can liquidate without added risk.

Why a box? I don't know...
maybe because a box connects upper and lower lines?

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trueblueTEX
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Postby trueblueTEX » Mon Jan 21, 2013 12:28 am

MightyOne wrote:Are you being difficult to be funny?


Not trying to be either. Which I guess is just pathetic :lol:

This month is the first time I've opened a chart in 2 years so I'm just trying to make sure I understand all the terminology correctly for what you're teaching.

Back then it was all scalping that I was trying to learn. I don't remember ever using the fib tool and planning a trade was simply "wait for the signal" and enter -- oh, and then find a new signal each week because last week's signal was no good.

I hate to admit it, but the ignorance was sincere. :)

I expect that to change over the next few months. :wink: (the ignorance, not the sincerity)

Thanks, MO

TEX

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Postby MightyOne » Mon Jan 21, 2013 3:34 am

Get the greeks out of the way:

http://www.amazon.com/Option-Greeks-Pla ... in+english

and then study option strategy: Iron Condors, Vertical Spreads, etc
before ending with adjusting your options positions.


Your investment strategy might then look like this:

option spreads ---> vanilla options ---> underlying

1) the spreads safely gather 'Space' and can be used alone for monthly income.
2) the space gained from spreads allows you to make long term directional plays with limited risk and unlimited profit.
3) if a trend develops then you can liquidate your options for 'Space' and trade the underlying without fear of personal loss.

With options you can:

bracket the market so that you make money if price stays within a range.

draw a line so that if price stays above/below it you make money.

make trades that you do not have to watch all day long.

& in Stocks & Futures the market actually closes! <-- saves yourself a few early gray hairs.

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