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DbPhoenix

Market Wizard
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Everything posted by DbPhoenix

  1. DbPhoenix
    This particular chart is not derived directly from the two charts above it that are included in the same post (#21). Its purpose is to show three types of S/R, not to illustrate a "zoom in". At the time I drew it, the bulk of the trading activity was between 1760 and 1800, within the hinge, with the midpoint, or greatest number of trades, at 1780. Now, however, with so much trading activity between 1760 and 1710 over the past few days, the volume is more evenly spread across a wider zone.
  2. DbPhoenix
    Zeroing in further . . . to a daily EOD chart
  3. DbPhoenix
    As I explain in the "Springboard" post to my Blog, the "zone" is found by determining the greatest quantity of trading activity over the period under consideration. It's general, forming what is more or less a bell curve. One can narrow this down to get an equilibrium level, or widen it to find the limits at that time for support and resistance. The entire zone, however, provides its own support or resistance once price leaves it. Within the outer edges of this zone, there will be "levels" (see above chart) where tests have occurred. These aren't as important as the zone in its entirety because they don't represent much trading activity. The more these levels are tested, of course, the more trading activity. The more trading activity, the more potential S/R. What matters is not that they guarantee turning points but that you're aware of them before trading activity reaches them again. Locate the most likely S/R zones and levels ahead of time, then study what happens to the trading activity if and when the zones or levels are reached. These zones and levels and points are not guaranteed. That's the purpose of trading RT rather than putting in your orders and going to the movies. Use the image icon in your toolbar and supply the url of the image you've uploaded.
  4. DbPhoenix
    I posted this chart yesterday to provide context for the movements that the market has been making over the past few weeks, though I had not extended the demand and supply lines all the way to the right edge. However, the zone can easily be expanded to include the band just above. Whether we actually make it that far is to be seen. But it is certainly within the realm of possibility. In that event, the midpoint will of course be raised. I also posted this chart as a response to a question about where to locate S/R. I look, in order of importance, to zones, then levels, then points. It's interesting that price rallied to 1760 overnight. The relevance to RT trading, of course, is that one must first find those areas or levels where traders are most likely to get excited and perhaps prompt a reversal or continuation. Today that area would appear to be 1750/60.
  5. DbPhoenix
    More than a couple 1. It's only marginally lower, but it's possible. If it's under accumulation, there will likely be many of these. 2. No. 3. See 2. 4. Depends on whether or not the advance is sustained. If it isn't, it's more likely short-covering. 5. See 4. 6. To decide what? 7. If I were interested in trading this, I'd wait to see where the first rally takes it and whether or not that might offer potential R. The easy money has likely been made here.
  6. DbPhoenix
    Since you're talking about a retracement rather than a reversal, yes, I always trade with the trend. Doesn't have anything to do with megabucks. Trading with the trend is a principle that holds true whether trading a monthly chart or a tick chart. Fortunately, since I now daytrade, I no longer have to worry about the longer-term trend.
  7. DbPhoenix
    Apparently we're not on the same page after all. If you're talking about a LT bull trend and you've got a retracement, I wouldn't be looking at a short trade. I'd be looking to add to my long position.
  8. DbPhoenix
    Short answer, yes.
  9. DbPhoenix
    That's not what I consider to be accumulation/distribution. It's not important enough. But if it works for you, that's great. Jargon is supposed to serve as a shortcut, but also as an aid to communication. Without it, medicine, for example, would be in a world of trouble. And if one is working alone, he can use whatever terms he likes (calling shooting stars "spindles") as long as they help him with his trading. But when you mix together Market Profile and VSA and TradeGuider and Wyckoff and Evans and Williams (both pre and post-TG) and Market Delta and SMI, for a start, you've got an awful lot of jargon, much of it conflicting, and communication and clarity get the short straw. Therefore, I try to avoid jargon whenever and wherever possible, which is one of the reasons why I, for example, use "buying pressure" and "selling pressure" rather than demand and supply. They more accurately characterize what's going on and elaborate definitions are not required. So, as far as the shorter cycles go, I'd refer you as I did to Sledge to Eiger's post 299. Excellent job. The only thing I bring to the party is the addition of support and resistance, so that I know when what appear to be reversal signals probably really are reversal signals and not just bored traders looking for something to do.
  10. DbPhoenix
    You're mixing the market's accumulation/distribution cycle with the comparatively trivial buying and sellling cycles that take place on many timeframes from seconds to weeks. Do you want me to show you what you should have been sensitive to last September, or do you want to know how to tell when it's time to exit a long or short trade? If the latter, review the posts that Eiger made to Zeon (299).
  11. DbPhoenix
    Since we're not defining accumulation, distribution, mark-up and mark-down in the same ways, I'll exit the field regarding this particular aspect. Otherwise, confusion will reign.
  12. DbPhoenix
    Yes, that was my point, that a thrust is fake, and one expects that sort of shortening as a sign of exhaustion. As for anything outside of the original course, I don't get into it. I prefer to stick with Wyckoff's own work. For the same reason, I bought a copy of the 4th edition of Edwards and Magee, which is the last or next-to-last edition that Magee himself revised, and a first edition of Schabacker. Sometimes people do improve on work that isn't theirs. But more often they just muck it up. In any case, the jargon doesn't seem to make things any clearer. Usually the opposite. And if one can work his way down to the most central principles, of which there are very few, he doesn't have to consult a list, much less a book, every time he has to make a trading decision. At his best, Wyckoff illuminates what is in front of the trader, whether on the chart or on the tape. He doesn't massage it and manipulate it and impose a foreign language on it. He is as clear as crystal, and I've found that to be exceptionally rare in the world of trading.
  13. DbPhoenix
    We're getting mired in jargon, which is why I try to avoid the SMI overlays. There are four stages: accumulation, mark-up, distribution, mark-down. The mark-up phase begins when the accumuation phase is finished, though one could argue that it's the last act of accumulation. Distribution begins soon thereafter, while demand is still high for the shares (or whatever). It does not begin at the top. The top is the fumes. The mark-down phase begins after distribution, but some of it can also occur during the end stages of distribution. These are not discrete stages, starts here on this day and ends on that one. What is most important is not to label everything but to detect the exhaustion, and this was abundantly clear in September. Look, for example, at the transports. Now some people apply these terms to brief buying and selling forays that to me have little to do with accumulation and distribution, but I've stopped arguing about it. As long as people know how to detect imbalances in buying and selling pressure and the signs of buying and selling exhaustion, that's good enough.
  14. DbPhoenix
    You are correct. He refers to "upthrusts" and "upward thrusts" a number of times, but he does use the term "downward thrust" once, referring to the end of April. Drinks are on me
  15. DbPhoenix
    Long before the scenario you've provided. Money that is literally "smart" sells on the way up, not at the top. Volume in September was crap across all the major averages. This suggested to me that they were done. Some people called it a head and shoulders. I didn't because the volume pattern wasn't right. But the end result was the same.
  16. DbPhoenix
    There are a number of posts above addressing today's action, and there are a number of things that should be kept in mind. First, we are at multi-year support. It's much better in the NDX than the SPX, but it's there nonetheless. Therfore, it should come as no surprise that there are going to be interesting times here. Second, the market has been gliding into this area since the end of January. In fact, one could argue that the volume at the beginning of the hinge signaled preliminary support, if not a selling climax (volume was also decent at the beginnings of the same hinges in the SPX and DJIA). Third, the hot poker today was news-related. If there was in fact accumulation going on in the underlying, the news may have sparked a response for which some of the bigger players may not have been prepared. Perhaps whatever accumulation was going on, if any, was supposed to go on longer. And it may well do so here (refer to the chart I posted earlier and note where we are with regard to longer-term S&R). While it's always possible that we may head right back into the old zone, it's also possible we may establish a new, lower one here.
  17. DbPhoenix
    I suspect that the "SOT" comes from SMI. Wyckoff's thrust was a short, sharp, and headfake move up, the opposite of a shakeout. What you're referring to is simply a secondary test or retest. FYI
  18. DbPhoenix
    Today's R in the NQ was 1730. Potential S was 1720 which, if we begin a bottoming (temporary) process here, may become the midpoint of the range to come, or the "POC". Where we are now:
  19. DbPhoenix
  20. DbPhoenix
    I prefer zones, then levels, last points. This is addressed fully in my Blog: PVSR Q&A S&R and Trading Trend The Springboard I'll try to provide a chart later.
  21. DbPhoenix
    Screen time will do that for you, but I'm glad I was able to contribute. It might also help -- or not -- to remember that there is no such thing as a "close" unless the trading literally stops, that what we refer to as a "close" is solely a function of the choices we make regarding how we display the data. Price couldn't care less. On the other hand, if this makes you dizzy, just forget I said anything.
  22. DbPhoenix
    Freedom from distractions, for one, like message boards. Also replay. And by "replay" I mean the sort that replays moving bars, not that just scrolls through completed bar after completed bar.
  23. DbPhoenix
    That's okay. It'll all cloud over again soon. That's the way of it. The learning curve can be accelerated under certain conditions, but looking at price action this way requires a certain conceptual and perceptual bias, and some people (many? most?) are never able to develop it. Fortunately, there are many ways to make money, though to me none of them make as much sense.
  24. DbPhoenix
    You're trying to isolate the variables and keep them separate in order to study them, but they all work together simultaneously. If you were to see the bars move, this would be clearer, and the simultaneity more obvious. A "volume bar" represents trading activity, both buying and selling. Trying to separate the two is pointless. If trading activity is "low" relative to the trading activity (or TrAc, if that's okay; I can't call it "TA") during other segments of the price/volume continuum (and it is a continuum), then there may be little interest on both sides, or there may be a great deal of interest on one side but not the other. You'll know which by how price behaves. If you've chosen to represent price by a bar, and there's a great deal of buying interest but not much selling interest, price will riese because there's "too much money pursuing too few goods". In other words, everybody's desperate for bananas, but there are only a few bananas available. So the price will skyrocket, but the number of transactions will be few. Therefore, if your price bar is extending itself as it reaches R and the volume bar is unremarkable, then you've got a lot of buying pressure (demand) which is driving price higher, but very little resistance (supply or selling pressure) to that demand, keeping "volume" or TrAc, low. With me?
  25. DbPhoenix
    Perhaps rather than settle for a representation of absorption, you could actually see it by having a chart with a smaller bar interval alongside or underneath. In this way, you may be able to see the brakes being applied, and you may not even find it necessary to wait for your regular bar interval to "close" before you make your move. All of this at S/R, of course.
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