DbPhoenix

And the first blue line shows where price is finding S as it works its way back and forth across the trading range that it's forming along the gray line. The second blue line shows where price is finding S above the VAP. Now look at what's happening with price with regard to the vertical price bars as price approaches, flirts with the gray lines, then reverses away. What does volume tell you about the level of activity in each of these events? What does price tell you about the relative strength of buying pressure and selling pressure? Remember to read the chart from left to right, not right to left.

Volume is trading activity. The more trading activity at a given price or price level, the more likely that level will act as support or resistance at some point in the future. And given how important support and resistance are to reversals, retracements, and breakouts, paying attention to volume at price is worth the doing, particularly if one has trouble seeing these relationships with vertical bars or with vertical bars only. Therefore, look at where these horizontal VAP bars are pointing. What is happening at those levels that may or will be important to you later in the chart?

If the webinar is centered on behavioral manifestations of paranoia, phobias, and/or general passive-aggressive and/or approach-avoidance tendencies, you will soon have a rich and aromatic brew.

I'm a little concerned that those who are trying to learn this not get too wrapped up in jargon. Jargon is a kind of shorthand, intended to facilitate communication. Instead, it often hinders communication, even among those who, on the surface, "understand" the jargon's referent. Those who are part of a profession of some sort -- psychology, medicine, law, education, etc -- tend to be more comfortable with it than those who have little contact with it (or think they don't; even cooks have jargon). But even within those professions, the jargon can often be a stumbling block. Just ask ten psychiatrists/psychologists to define "schizophrenic" without resorting to a textbook or manual of any sort. "Technical Rally" is a handy term, meaning as it does that the rally more likely consists of "bad buying" or "amateur buying" or "ignorant buying" than "good buying" or "professional buying" or "informed buying". What does all that mean? That the buying is, literally, purely technical, whether short-covering, misinterpretation of the inflow of buying pressure, or the ever-present desire to "catch the bottom". In the case of short-covering, it isn't "real" buying, i.e., the buyer doesn't wind up holding anything. As for the other buying, it is of the kind that will reverse itself at the first sign of trouble. It is not committed. But oftentimes, the only way to tell whether the rally is technical or not is to wait and see whether or not the shares or contracts are quickly thrown back into the market, and, if so, when, which is what the "secondary reaction" is all about (though there's nothing wrong with calling it, simply, a test, since that's what it is; if jargon isn't necessary, why bother?). If and when those shares/contracts are thrown back into the market, one can then have more confidence that whatever buying occurs after the test is "good" buying, i.e., people that plan to hold onto what they've bought, and maybe even buy more. There is also the issue of "climax", which is often explained badly, perhaps even by me, resulting in the beginner's continuing search for it, signalling the opportunity to buy. Genuine climaxes, however, are relatively rare, and they are often seen as such only in hindsight, which doesn't do the real-time trader any good (though pegging them impresses the hell out of the gallery when the "pro" is presenting his hindsight analysis). "Climactic volume", on the other hand, comes along more often, and though the difference can seem niggling, these episodes of climactic volume can serve as flashing yellow lights, warning of important events to come. Here, you have at least two of these, the first two red lines. One can call these "preliminary support", which hardly qualfies as jargon if one knows what the word "support" means. Otherwise, one can simply point out that the balance between buying pressure and selling pressure has shifted -- or will quickly shift, since the volume can come in on the way down -- to the buyside (which is actually the explanation that I prefer; avoids doubt as to the poster's intent). One can't know at the time whether one is actually looking at a climax or not until at least the supply line is broken or the test has taken place. Here, the supply line is not broken and you end up with lower lows. Hence, no climax. After the third spike in trading activity, price still doesn't break the supply line, but there is no lower low, and volume on the test is much less than it had been within the spike. When volume spikes again, it comes in on the upside, and the supply line is finally broken. Is this a climax? Yes and no. It is "a" climax, but it is not "the" climax. How does one know? Support and resistance, which is what nearly everyone leaves out of the equation. Unless you're looking at relatively serious S/R, it is likely that what you think is a climax is more nearly climactic action that a genuine climax. Since you can never be absolutely sure in real time, this doesn't mean that you can't go ahead and play what you think is a climax as a climax. You may after all be right. It happens. Just don't be surprised if your trade has no legs and price has further downside to go. The real climax, of course, takes place at important S, which is at 28.75+/-. All of this occurs at 1530 (one can see this S by including the 23rd thru 27th). One can expect it to occur here (which is one of the chief advantages of this approach), watch it happen, then take advantage of it. Granted, 1530 may be a little late in the day, but it provides an awfully nice setup for the following Monday IF one is prepared to act as soon as the market opens (or one can take a position a little earlier, at 0800, if one is comfortable trading premkt). A final note: static charts and hindsight analysis have their place. They serve primarily to illustrate principles. And I can understand and appreciate the effort that people put in to creating these charts and presenting them for comment. However, there isn't a single principle that hasn't been illustrated to death by the hundreds of charts already posted here and in my blog. If one truly wants to understand this, at least to the point of actually being able to use that understanding in real time to make money, he must study it in real time. And that means the chat room, unless the beginner wants to pay somebody to sit with him alone during the trading sessions. But not only can that be expensive, one is then limited to only one point-of-view. Granted, some people think the chat room is a waste of time. And there can be a lot of literal "chat" when the trading gets boring. But that's what the Ignore function is for. If one declines instead to tap into the talent and skill and experience that is represented in this chat room, then he can expect to spend a great deal more time grappling with the problem of how to ride these waves and eddies and currents during the trading day. On the other hand, those who cannot trade during the day are urged to divert their attention to EOD trading, where the opportunities may yield even more profit, and with a hell of a lot less stress. These charts can be posted prior to the point where action is required (no reason to post them afterward), making them "precognitive", which is even better than real time.

Oh, jeez. I sure hope somebody is given the opportunity to "cleanse" the scripts before they're archived. Otherwise, this could have a pretty inhibiting effect on some participants. Of course, what occurs in the chat room depends in part on whether one views it as a visit to the pub or as attending church. I prefer the former, as long as the bouncers are at their posts (so far there's been only one problem, a visitor who had an unnatural interest in my "equipment" -- flattering, but off topic).

1. Of course. The boxes are not an indicator. They're just trading ranges, what MP calls "value areas". They exist because trades are forever looking for trades, like sharks are forever looking for the next meal (and I don't mean to imply that traders are sharks, only that they're always on the move, looking for a trade; that's what they/we do). Therefore, like a school of krill, they can change direction at any time at any place, for reasons that may not be apparent at the time but which are illustrated on the chart. 2. What is intriguing about AMT is that it "works" as often as it does, which is nearly always. The midpoints and limits of each range are like the seasonal homes of migratory animals, and unless there is some important, intervening event, price works its way from one end to the other in an unusually predictable way, if one knows where to look. Even so, there are no block walls at each edge of the range, and the mix of participants changes before, during, and after each turn. But regardless of changes in the mix, the "instinct" is still there, and traders will work their way back and forth in a way that is predictable enough to enable the individual who's paying attention to profit.

Any relation to Hairy Hindquarters?

Someone asked me today about what boxes I watch and I replied that I watch primarily the most recent, particularly if we happen to open on or inside it. However, as Hlm has pointed out repeatedly, price will also find its own S/R intraday, and one has to be sensitive to that. Being stubborn and taking trades only at what he has determined premkt to be the most important S/R is certainly one route to take, but being too stubborn has the effect of closing one's eyes to what traders are doing right in front of him, which defeats the purpose of learning this approach in the first place. Today, for example, we found R at a just-premkt level and the short was on. But instead of travelling all the way into one of the larger, older ranges, we stopped at 80, at the other side of what had become a smaller range which began, more or less, on the 30th. We then reversed back to the upper level of this range at our old friend 1200. We then broke out of this for a long. But how far could this be expected to go? There was no "range" per se. No "value area". Just a 100% retracement from 1240. But the midpoint of this /\ was 1220. And guess where we found R? Therefore, regardless of how much preplanning and possibility mapping one has done premkt, he must always maintain a watchful eye and an open mind, like a hunter, and remain sensitive to what traders are doing at the moment. The chat room helps here as others who are watching the same thing may notice things that one doesn't. So don't be too quick to ignore. One never knows who's going to pick up on what.

Unfortunately, this should be done before you go to bed, and you're about ready to do so. By tomorrow, this will be nothing but hindsight and the usual intellectual exercise. The principles are the same. The only difference is how you apply them. Take the open, for example. The short was pretty clear, but what happens when the first target is reached? Do you scale out? SAR? How do you make the most of whatever reversal may occur? There are all kinds of ways to play that, and the choice depends on how well one reads the price movement, whether or how he scales out, what his risk tolerance is, and so on. But as to your later entry, charted here, you entered at the right time for the right reasons. And while taking profits at 2 points is certainly an option and certainly okay, it also suggests that you have no interest in learning how to read traders' actions and would rather be airlifted out of the water than try to ride the wave. In terms of PA, there's no particular reason to exit as long as you're making lower highs and lower lows. The first sign of trouble is the lack of a stairstep on the next swing high. It in fact creates almost a double "top". When the lower low is then so wimpy, you have to look for a reversal signal, even though you may not be at what you thought was S, knowing that price will often create its own intraday S. I believe you did all that, and you exited appropriately. If you had had an SAR setup ready to go at the swing low, sure, go ahead. If you didn't, then you didn't, and the next opportunity is either a long at a higher low or another short at a test of R. Your choice, all in the context of whether or not you want to be in all the time or close to it, how much profit you're willing to settle for, how tight you want your stops to be, how much you're willing to pay in commissions, and so on. It's all right, in other words, to wait for those opportunities which present the highest probability of a move that's worth your while, but may not be worth anybody else's, just as what is worth someone else's may not be worth yours. This means a lot more waiting, but at least you won't be talking yourself into trades that at bottom you believe just aren't worth the effort. When someone says you ought to do this or you ought to do that and none of it is right for you, just nod your head and go on about your business. The P&L isn't all there is to it. You also have to consider how much energy you have to expend to achieve a certain result, how much stress you have to endure, how enjoyable one course is over another, and how much time all of this takes. You may also want to look over again that bit I posted from Innerworth on Possibility Mapping. It will make your day a lot easier.

I'm pressed for time. I'm hoping that FW or Head or one of the others who's been working on this so vigorously will give it a shot. If not, I'll get to it when I can. Sorry. Actually, anybody who's still in the shallow end is welcome to give it a shot as well. It's not like there's only one answer.

Not exactly. Remember that these bars did not exist in the form you've plotted until at least 11:15. Therefore, they aren't going to tell you much about S/R until it's too late to do anything about it. If you're going to use VAP in real time, then you have to attend to whatever message they send you in real time and then respond to it -- if any response is called for -- in real time. So, in real time, you would see these VAP bars being formed. Without regarding them as "boxes" or as formal S/R of any kind, what would they be telling you by 1015 by forming at certain price levels in front of your very eyes? What would they be telling you by 1020? Keep in mind that you have two goals: to determine which direction the breakout, if any, will take, and to find that level at which you can enter ahead of the breakout.

No problems at all. Thank you.

Probably not. But I have no moral objection to it as long as it doesn't affect the stability of the chat room. Ditto with the game room.

The issue has nothing to do with "resisting change". It has to do with making the room useable. The whiteboard "room" is, after all, entirely separate. One can use it or not. Like the game room. What I'm looking forward to is a room that doesn't repeatedly crash.

Edit: never mind:)...

I'm not real clear on the purpose of the whiteboard. So far, all we've seen is doodles and drawings of animals. What exactly is it for in terms of a trading application?

Would it be possible to get the old chat room back while the issues with the new one are being worked out?

It isn’t so much what one thinks as what one believes. One who believes the market is random will trade it one way; one who believes that it’s non-random will trade it another. One who believes that it’s a vast, manipulative conspiracy out to trick him will trade it differently from one who does not. One who believes that the keys to the kingdom lie in a bar chart, or a T&S display, or “the book” will trade differently from one who does not. One reason why so many of the "discussions" on message boards fragment so easily is that everyone is operating on different belief systems. This is largely what Douglas is all about, that our behavior stems from our values which in turn stem from our beliefs. In that context, he proposes what he calls the "five fundamental truths": 1. Anything can happen. 2. You don’t need to know what is going to happen next in order to make money. 3. There is a random distribution between wins and losses for any given set of variables that define an edge. 4. An edge is nothing more than an indication of a higher probability of one thing happening over another. 5. Every moment in the market is unique. #2, for example, may or may not be realistic or practical depending on one’s beliefs. If one believes that he must know what will happen next in order to make money, then his focus shifts toward being right, and a focus on being right invites all the ego issues which so many beginners talk about. On the other hand, if he believes that he doesn’t need to know what’s going to happen next in order to make money, a great weight is lifted. But regardless of the set of beliefs with which one begins his study, at some point the strategy will either be profitable or it will not. If it is not, then whatever one believes is immaterial. The most fervently-held belief will not turn a loss into a profit. Therefore, if one is able to apply the scientific method to his study, he may be able to begin doing fairly well rather quickly and "psychology" may play only a small part, if any. But if he drags along a lot of baggage, he may never achieve any success at all.

In and of itself, not so much. But there's a lot more here. Yes. Since you're using Volume At Price, what does the VAP tell you in your chart?

I don't know that this belongs here either, but I don't know where else to put it, so here is as good a place as any. Are you saying that you had no idea which way price was going to go before it broke out of the hinge?

Remember first of all that daytrading is not the ultimate goal of every market participant. There is no generally-held belief that you have not arrived until you're a daytrader. Granted it all appears romantic and sexy, but it is primarily little more than busy. Playing World of Warcraft would keep you just as busy and it would be a lot easier on your pocketbook. Keep in mind also that many of those who go on about the riches to be found in daytrading aren't actually trading, or, if they are trading, they are making little or no money (eventually they disappear, with or without fanfare, and one learns after a while not to pay a great deal of attention to the claims made on message boards). Therefore, rid yourself of any notions that if you're not daytrading, you're not really trading. Traders can also trade daily charts, or even weekly. And if you can't be at your computer during the trading session, daytrading -- or intraday trading -- just may not be for you. Since you have experience with mutual funds, you know all about patience. And given your particular tax situation, frequent trading will likely generate more frustration than it's worth, certainly more than is necessary. Consider, then, a postponement of your trip to the real-time world as well as all the paraphernalia required to go there and work there. Once one has decided to make a big change, he naturally wants to get on with it, and as quickly as possible, which is why so many people go from the one extreme of long-term investing to the other extreme of intraday scalping. You appear to understand that there's more to it than buying a charting program, subscribing to a streaming datafeed, and opening a brokerage account. You also appear to understand that there is a process through which one must go, either now, fresh and with a clean slate, or later, after a string of disappointments and failures. Therefore, at least entertain the idea of EOD (End Of Day) trading. Not only will this not require you to be in front of your computer all day every day, it will neither require you to wait an intolerable amount of time for your work to pay off. While some have compared EOD trading to watching concrete set, doing it the "Wyckoff way" is something different, waiting until just the right moment to take the trade, then reaping the benefits (or getting stopped out) almost immediately. Gringo, for example, proposed two trades in the EOD thread, one of which he took and one of which he didn't. But both ripened within only two or three days. For someone with a full-time job and family responsibilities, two or three days is a mere blip. Of course, if you're desperate to daytrade, why not? The best way to learn what you're in for, and up against, is to try it. But if you have a life, and many things to occupy your time, you may find that EOD trading is just the thing. Far faster than the mutual fund route if you approach it as Wyckoff would, but without all the pressure and anxiety of intrady trading. The same principles apply, the same procedures, and often greater rewards. And you don't even need a real-time feed.

If you've spent more than ten minutes on message boards, you must know that my answer is going to be "it depends", or, better still, "yes and no". The core of W's approach is to find the best opportunities at the time one can expect them to move and to limit one's risk to the fullest extent possible at the time of and during the trade. You're on the right track, but you need to think long and hard about risk. You have a lot to think about and a lot of prep to do. But there's no hurry. The market will be here whenever you're ready to go for your first ride. Take your time and go step by step. That way, there'll be no fear, no anxiety, no panic.

It's magic (see my avatar). I'll take you to Diagon Alley to get your wand.

Lest this thread wither, I refer interested readers to review a series of posts made to the EOD thread. They do go on a bit, but they jibe nicely with the material that Bearbull et al have posted here. The process of identifying trading opportunities is after all the same, whether one is trading EOD or intraday.

If you have no experience, I suggest you begin with the least expensive option available, though what is least expensive will depend in part of what datafeed you select, and what datafeed you select will depend on what you decide you want to trade. Since you'll need nothing but price and volume, there's no need to purchase anything more involved. After that, I suggest you select one of either currencies or indexes, whichever you understand better. If you don't understand either of them, consider ETFs or even stocks. If you don't understand those, either, find something that is not a complete mystery. Then get to know it. Once you have a basic understanding of whatever it is you want to trade, then begin studying how it's traded. And for that, Head2K's advice in another thread is pretty much what I would suggest. But coming from a fellow beginner (I assume you're a beginner, or close to it), perhaps it will carry a bit more weight. I am a beginner and I've been studying Wyckoff for quite a short time, but I believe your observations are basically correct. First one needs to choose a way. A way of thinking about market, understanding, interpreting and analyzing the market's action. After some rambling from one thing to another I found Wyckoff and fell in love with him. This way is beautiful in its simplicity and it gives you a chance to get in harmony with the flow of the market (Not saying I got to this phase, but I have some bright moments). Being in harmony with the market's flow provides a kind of inner peace, and implies confidence. As for the process of learning, first one needs to understand the theory. This forum and Db's blog are great for that. Texts and static charts should serve the purpose. Once you think you understand the theory to some meaningful degree and you can interpret historical charts, you should move to live charts. Not trading, but analyzing and interpreting. Without hindsight it gets much harder. Then, if you think you gained enough experience to actually exploit your understanding, you should start with strategy development and paper trading. And once your plan is developed and you gain consistency on paper, you can start live. Each of these steps is going to take time, perhaps more time than you're willing to invest. If you go through these steps methodically and deliberately, it will take less time than if you rush. And if that sounds like I said it backwards, I didn't. Another resource is the Trader's Journal, which will help you figure out what you want and how to go about getting it. You may have already made some of these decisions, which is all to the good.