Niko

Thanks George, I looked for that even in the Bloomberg terminal and could not find it. I have used the information on the NYT 1930-31 data for creating an excel spreadsheet, that allows whoever is using it to go through the chart step by step, I think this helps and saves a sheet of paper,hehehe. I hope this serves any useful purpose. [ATTACH]29319[/ATTACH] If the button does not work, is because a macro restriction, I cant upload the macro file, I guess because of virus protection.

Ok, here goes my analysis, I must recognize that this one was harder than the last one, as prices were very erratic at some points of the period of interest. This kind of work really brings the market to one´s head, and it improves immensely the ability to spot things in real time, of course I am just starting with this, but I already feel the change in my rationale when watching the intraday chart. Thanks DB once again, this is a great thing you are doing here, I have looked everywhere for a forum in which traders (experts and amateurs) could share without being pitched this or that indicator. During July the market was stuck in ta trading range between 93.55 and 100 with a midpoint around 97. By July 22nd the prices rose on decreasing volume up to the resistance area, were the advance was stopped without a significant increase in pressure from the sellers, this denoted weakness on the buyers side. On the 26th the struggle between buyers and sellers intensified, but the sellers did not manage to hold the decline by the close of the market. Sellers came in strong on the 27th dragging the price to the midpoint of the trading range where the decline was momentarily stopped on the 28th before continuing its down movement with increased volume. On august 1st buyers came into the market but where neutralized at the midpoint where strong resistance came in and took prices to the bottom of the trading range. On Aug 2nd came the breakout after which the market went on a freefall on increasing volume until Aug 9th, when the market developed a selling climax after which the market had a normal 50% reversal on decreased volume, signaling weakness on the sellers side. This was confirmed on the 18th when prices fell all day, (nevertheless it should be noted that volume did not increase substantially), on the 19th, an increase in volume came from the buyer´s side signaling buyers coming into the market around 79. Prices rose again on decreasing volume signaling a possible reversal on the 23rd and 24th of august, this reversal in prices did occur, but prices again found support intraday on the 25th on the midpoint of the last rally, this might have served as a warning signal for those who went short on the 24th. The upside gap on the 29th confirmed the doubts about the downtrend, but although the high of the august 17th was broken, the limited advance in prices without significant increase in volume did not show particular strength on the buyers side, that was confirmed with the reversal in prices at the end of September. Buyers came in at 83, just below the midpoint of the last rally and around the trendline formed with the lows of Aug 9th and Aug 19th, after this the market had a rapid advance (measured by the spread of the September 7th), but found resistance just above the last high of September 1st, then prices fell on increased volume, then rose on even more volume, but were not able to rise above resistance on September 13, signaling that that day sellers were not interested in seeing prices go above resistance. The following 3 days prices went into a trading range on decreasing volume, this trading range was broken on the 19th, and that coincided with the breakdown of the trendline. The market then fell on increased volume, and found support around the lows of Aug 19th, then came a rally on decreasing volume to the midpoint of the last trading range. After this the market fell on increasing volume, until reaching the low of august 9th where it found support. Prices retraced on increasing volume for 2 days before buyers lost their impulse and up-volume faded on October 10th just around the midpoint of the Aug-Sep trading range. Up to this day, it was not clear if buyers or sellers were in control, looking back all the way to July it seems like by Oct 13th we were on a potential point of continuation of the downtrend. This was proved wrong on the following days when the market went up on low volume until it reached resistance at the high of September. By Oct 20th prices retraced to the midpoint of the Aug-Sep trading range, where they found support on increased volume and started their ascend on increasing interest from the buyers who were able to break above Sep resistance and keep prices going up until they reached the lower end of the July trading range, there prices created a new trading range between the two congestion zones of July and Aug-Sep. At the end of the chart, prices had found support at 90 (the top of the Aug-Sep trading range), but did not show any clear signal of a possible breakout direction. As for points of entry for long trades, I really could not find as many as DB identified, but these are the ones I would have taken, I am only describing entry levels, without defining stops or take profits: 1. Stop entry after the Selling climax of Aug 9th , this trade had limited potential (and finally failed), as it could possibly stop its advance at the midpoint of the last rally, as it did. Decreasing volume meant that there were not new buyers coming in on the way to the midpoint. 2. Stop entry on the high of Sep 1st (That would have been executed in Sep 7th). Due to the risk involved in buying the high, the reasons I find to take this trade are mainly because of the spread in prices on the 7th and the increase in volume. 3. Stop entry at the high of Sep 26th, after the test of Aug 9th low. Decreasing volume on the entry day was a warning sign. This trade failed miserably as prices bounced back down on the midpoint of the last trading range. 4. Stop entry at the high Oct 4th after the re-test of Aug 9th low. Increasing volume on the entry day served as confirmation. 5. Stop entry at the high of Oct 20th , after the market found support on the midpoint of the Aug-Sep trading range.

Db, but how do you tell the difference between a pause and a technical rally, I have understood a technical rally as the rebound after a climax, does that mean that Friday action cannot be classified as a climax?

The first development of the week came in yesterday with a technical rally. Let´s see how this develops during the rest of the week.

Db, thanks again for taking the time to read my comments and going through the hassle of giving the thread participants some homework, I hope I got at least the basics right. Here it goes... After coming out of a range in the 29th of March on increasing volume the market again entered into a congestion zone between 101 and 105. By April 23rd the market was in a dead center at the middle of this trading range, it started testing resistance without a significant increase in volume, and by the end of April had reached the resistance level of this trading range without strength, which could mean an absence of selling interest and not a significant increase in buying interest. At this time, one would have to wait for either a breakout or an increase in volume to the downside to define a possible outcome. By May 1st there was a breakout on increased volume but not really significant if compared with the previous month activity, so I think it would be better to wait for confirmation to the upside. On the second of may prices retreated on increased volume, which signaled the buyers had lost control of the market. This could have been an opportunity to go short, with a stop above the high of the 1st. The market then fell on increasing volume breaking support on the May 4th, then stopped on May 7th at the Nov-Feb support level (not on the chart). After that the market entered a congestion area once again until forming a hinge in decreasing volume on May 11th. Then on May 12 the market broke the level of support at 95 on not very significant volume. Then volume increased, but prices did not advance very much, measured by the difference between open and close, giving warning signals on the strength of the sellers, but not signaling though, strength on the buyer side. Although a small trading range formed during the 16 and the 17th of may, the buyers could not bring significant interest to the market on 92,5, that was the low of the (Nov-Feb range), this level was broken on decreased volume, this in the context can be interpreted as sellers leaving the market on its own, in order to measure the strength of buyers, a weakness sign. As the market approached 90 (the top of the Aug-Nov trading range), it went again into another trading range, it formed a hinge on the 25th and then buyers tried to take control of the market but failed on the 29th losing terrain on increased volume. At this point, all signals point to weakness, not justifying long commitments, but perhaps giving an opportunity to enter short on a breakout to the downside of this last trading range. After breaking the 90 support level, the market has been going down on increased volume. By last Friday, the market had declined significantly and close near the lows, a signal of sellers keeping control of the market, this do not give promising prospects for bottom catchers as me, hehehe. This signals the sellers who are already committed to stay short, and those awaiting for an opportunity to wait for the development of another congestion zone, perhaps around 82 (the midpoint of the Aug-Nov trading range), in order to define if the market is finally going to have a significant reversal, or if after another small trading range is going to keep on going down. We will have to stay alert during the week awaiting developments.

Now taking this a step further, after yesterday trading it can be seen how the midpoint of the aug-nov range held the market above 83, on what appears to me as a climatic day. Now, we can either expect the market to: Keep going lower on high volume and reach 77 by tuesday or wednesday. Stop for a few days and keep going lower trying to reach 77 within 2 weeks. Have a technichal rally trying to reach 90, establishing a new congestion zone. Anyhow, I think it would be a good idea to go long 1 dollar or less above the low of friday with a stop under the low and keeping an eye on price when resistance is reached. Any comments?

Db, thanks great explaination, now, regarding entry strategies, do these resting stops serve any predictive value according to your experience regarding Wickoff trading system. I mean If one just entered long at 90 some weeks ago (assuming that was a valid resistance level, and of course ignoring the strong downtrend) and got stopped at 88/89, would It be prudent in Wycoff methodology to trun the position from long to short, perhaps with a stop entry that got activated as the long position is closed? Or even if one was neutral, would it have been a good entry to short at 88/89 with a stop order on the breakout of that 4 day range.

Db, Thank you for your comments. One of the things that I found most fascinating about Wyckoff, trading method was the ability to buy in the lows of an ending downtrend and sell on the highs of an uptrend. Of course that fascinates me and intrigues me, because I have not been able to grasp how does Wyckoff tells a good entry in this kind of conditions from a wrong one, as the ones I have had in the past.... hehe. By what you wrote, I understand that I must forget about catching bottoms and tops unless there is a climatic action at the S/R level. And then the question that arises is how to define the proper S/R levels, as can be seen from my charts I got carried away with a lot of levels. Assuming one has VP tools, as those shown in the charts, should one only focus on the extremes of the volume distribution and on the middle, or what can be an appropriate criteria? If this is explained somewhere else in the site and I have skipped it please excuse me for asking stuff that has already been mentioned.

Below I have posted my estimates for SR for the WTI Spot price in the weekly and daily chart. I think the course of action suggested by these charts, is the following: We are in a downtrend so one would look for support in order to define possible long entry levels if at those prices in the intraday charts one can find a successful test of support. The stop would be located under the support levels. As the current price is 86,55, one would expect to find support at the following prices: 84,76 daily chart nearest support level. 83 weekly chart next support level 82 daily chart next support level 79.55 daily chart next support level As we are on a down trend, one would not expect a reversal anytime soon, so I suppose one should be expecting to take profits when prices meet resistance or at least reduce one´s position and take the rest to breakeven. But as we are in a downtrend I would be more inclined to close and reverse to a short position at resistance levels. One would expect to find resistance at: 88 weekly chart nearest resistance level 89,25 daily chart next resistance level 92,5 weekly chart next resistance level 95,38 weekly chart next resistance level One could enter if those resistance levels are successfully tested with a stop above resistance and keep the trade going unchanged until a support level is reached, then I think the stop should be trailed (I am not sure if to a breakeven level as this can be easily touched depending on the circumstances of the market at that level). I think one can trail the stop to the next broken support level as this would now act as possible resistance. Well, those are my conclusions (I am an amateur at this so I would appreciate your comments) Weekly Daily

Db, thanks for the explanation, I appreciate very much what you have done; my extratrading activities do not allow me to meet the end of day deadlines in an easy manner (the price of fatherhood, at least in my case). I am very interested in the study of S/R. As I posted in another thread, I mainly trade intraday with a mechanical system that uses moving averages and other indicators. Although it works decently, I have been always very frustrated because I have not been able to know the WHY, and I just recently began realizing this things when I happened to find the Wyckoff courses (by chance), and your posts, that I have to thank for being so clear cut and pertinent. What I am trying to do is to be able to enter the market, not because one line crosses over the other one, but because I identify that either buyers or sellers are in control and be able to close my position, not because my backtested TP tick target has been met, but because I find that those players who were in control are no longer the leaders in the market. I guess that is easy for some of the guys in this thread, but is a change of paradigm in my case. I will then make the same exercise with the CL contract for an EOD chart, now that it is not required to get things published as fast as in the other Thread. Thanks again.

Ok, this are my estimates of S/R for the CL july contract.

Ok, I will then post my charts at the end of tomorrow. Thanks for the advise

Thanks for the Reply DB, I will then post S/R levels for oil tomorrow before the open in case anyone is interested in the discussion.

I see this thread is mainly for index traders, and I must say is a very interesting and educational thread. I trade Oil. I would like to know if posting S/R levels of CL is of any interest here?

Db, when you say that the trader must understand the continuous movement of price, what do you suggest (if is in another thread, I apologize for asking something that has already been written) is a good methodology for learning how to grasp this continuous price movement. I currently try to do that using a 20 seconds bar chart with volume, and a tick by tick chart with volume, although I have not been able to consistently identify real changes in the short term trend from the second. Thanks for your valuable contribution in this thread

Thank you Db, I had been looking everywhere for the second part of the course. BTW this thread is great, it had served me a lot to understand plenty of things that I did not get from reading the Wickoff course directly. Edit: Db, the Scribd file is corrupted, do you kwow where else can this part of the course be found?

Db, thank you for your reply, as I said, I currently trade a non-wyckoff system that I created mainly using moving averages (When I said proven by my standards, it is because although it is profitable, I think I can get much more of it), I just recently started studying Wyckoff (less than a year) and I have tryed to include volume and price movement in the system, that has improved substantialy my percentage of profitable trades. I currently consider myself a very fearfull trader as my previous experiences with the market were not as good as I expected them to be. So as you pointed, this has led me to define very thight stops and to move my trailing stops very soon, wich at the same time causes me to almost never reach the take profit targets I initialy define on the trades. This is also the motive to increase my knowledge base using Wyckoff in order to understand better the relation between price and volume when setting the trailing stops. In the other hand, I have NEVER been able to consistently make money on non-trending markets where my moving average system simply doesnt work. That is why the charts I posted were charts of non-trending markets, for wich I am trying to develop a system based on W. rules. Thanks again for your reply.

I am curently working on building a trading system based on Wyckoff, I mainily trade trending markets with a proven system (at least proven by my standards) and applying Wyckoff principles about volume and price movement has helped me a lot, but it has always intrigued me how to make money in ranges and during the transicion from a range to a trend.

This is where I always fail. Following the trade I just suggested, is it advisable to move my stop under the new support area at 60 (is it a support area?), pehaps to 58 . Chart attached, and new stop suggested is in the red rectangle

Range breakout without volume. I am currently following CL, and I am seeig this as it happens (Chart attached) my interpretation of Wyckoff theory is that ther is not going to be a donwside breakout bellow 104,55 due to the fact that there is not selling volume following the downside movement, and that this is posibly a shakeout of bulls. I would think about buying at 60 with a take profit around 90 and stop around 50. Any comments?

I have been trying to do the count (Number of bars in the different counts) on the Oil P&F Chart in order to define targets for my profit taking but I find two problems: 1. What is the best horizontal line to do the count 2. In this case is a 3 point chart, but i find that if I multiply the number of bars from each count by 3 my theoretical target most of the time would be way too far for my timeframe. Any comments will be enlightening.

Thanks for your reply, yes actually before the FOMC statement the other reason holding the market from moving was the Crude Oil Inventories report. What I am trying to do, (if it is even possible) is to interpret from market action before the report what could be the most probable direction the market would take.

The entry was around 9:35 ET, it was a short trade, It was closed at 10:30 after the release of the Crude Oil Inventories data.

Hi, i just wanted to post a trade (Attached chart) I am in at this moment (10:08 ET) that is related to the Springboard question I made some days ago. As can be seen in the chart, price had been falling during the early morning and is currently stuck in a range. From reading the volume behaviour during the range it is not clear for me if the odds favor a breakout to the downside or to the upside. Perhaps someone in the room has a clearer vision and can spot things I can´t, Any comments would be appreciated.