Wolfe

[Guest Tresor]

While BlowFish is hopefully drawing his lines and points let us have a look in the meantime at a converging Wolfe which seems to be taught in the basic Wolfe course.

 

Nice and clean $1k of profit during a 3.5h trade yesterday on forex.

[waveslider 10]

This has gotten pretty ugly...

 

I would once again like to ask participants in this thread to stick to call out "their version" of wolfe waves..

 

I was hoping to engage you all in identifying a wave in the S&P (see my post date a week or 2 ago).. While all of this bickering was going on there was a nice 40-50pt move that just completed...

[waveslider 10]

Tresor, what you are posting doesn't help too much since they are posted in hind sight. Let's do this in real time. I would have posted mine in real time but I was trying to start a discussion and didn't want to influence other's pattern analysis.

I'm sure we value your contribution, but want to see how your version works in real time.

[Guest Tresor]

Who and why keeps on deleting my posts in this thread?

[thalestrader 14]

Who and why keeps on deleting my posts in this thread?

 

Since know one else has answered you, and since you remarkably are incapable of figuring this out for yourself, and since I do not want to click on this thread everyday only to see that what bumped it was you repeating this same question, again, I'll take a stab at it and say that your attitude, which, quite frankly, sucked, has clearly, it would seem, resulted in you become persona non gratis to this thread.

 

I do not know who keeps deleting your posts. But I suppose it must be a moderator.

 

I would suggest that if you wish to resume posting here, that you re-consider your approach and your tone toward the other members, and then start posting real time Wolfe wave's, which is, I presume, the subject matter of this thread.

 

If instead you are looking for a fight, or simply an arena in which to flex your ego, then may I suggest you start a Wolfe Wave thread (or a thread on any subject matter of your choosing) at Elite Trader - The #1 Site for Active Traders, where such behavior is not only tolerated, it is expected.

 

By the way, I'm just the messenger. Don't shoot the messenger, and don't ask me to where your black eye.

 

Best Wishes,

 

Thales

[Guest Tresor]

But I suppose it must be a moderator.

 

I suppose the same. I was just curious if it was the same brilliant moderator who thinks there can be different implementations of range bars.

 

I would suggest that if you wish to resume posting here, that you re-consider your approach and your tone toward the other members, and then start posting real time Wolfe wave's, which is, I presume, the subject matter of this thread.

 

Deleted where posts of educational value with diverging Wolfes. Hopefully BlowFish can testify such Wolfes are legitimate patterns once he decides to take an advanced course on Wolfe.

 

Hopefully my screenshots will be reposted then and beginners in Wolfe can learn the pattern (which is statistically more successful than a converging Wolfe).

 

If instead you are looking for a fight, or simply an arena in which to flex your ego....

 

I am not looking for any of the above. I only got a little upset when TL's gurus on Wolfe are resistant to new knowledge, which I always thoght would never hurt.

 

By the way, I'm just the messenger. Don't shoot the messenger, and don't ask me to where your black eye.

 

I am pro-peace.

[no_sandbags 10]

well now that the squabbling seems to be over . . .

 

thought i'd post a chart with a different take on things,

being that there's such a nice example from today on

the NQ, this is a 15 min chart

 

much of the talk about these waves is theory, and you

need theory to begin with, but as a practical matter its

best to pay attention to support and resistance in terms

of targets

 

some things to note on this chart . . .

 

1) the line from #1 to #3 is horizontal

 

2) the distance from #3 to #4 often gives a good projection

about where things are going to go

 

3) once that "flip level" is reached, the primary focus should

be on a counter (contra) wave forming

 

just food for thought . . .

 

[ATTACH][ATTACH][/ATTACH][/ATTACH]

[waveslider 10]

Welcome sandbagless,

 

Unfortunate about the bickering.

 

so you'd see the 1-3 line as balance for a mean reversion type trade. I can see that. The prob might lie when you examine volatility, if it is expanding then likely the #5 target would be over shot and the 1-3 line might not even be revisited.

 

Where would you have seen entries?

[no_sandbags 10]

hello waveslider,

 

the wave just gives a framework, there were entries all over the place

 

for starters the break of the (1,3) line was a short,

then there were momentum continuation plays on the way down

on smaller time frames, 5 min for instance. i mean there is

an assumption about where its going . . .

 

then the 1st time it hit 1958.00 @ 11:05 was a nice long

 

then the test back down . . . it ain't going to turn on a dime

 

the idea is that a smaller counter wave is going to form in that

area (flip level), so you just play the swings

 

the last 1/2 hour of the day rallied from 1957 to 1972,

triggering the contra. you do see the small sell wave at

the bottom, right ?

 

hell, Wolfe himself was just a scalper, wasn't he ?

Edited May 5, 2010 by no_sandbags

[no_sandbags 10]

waveslider,

 

okay, here's a 5 min chart showing the counter

wave (contra) at the bottom. it triggered right at

the end of the day

 

so based off this little wave we'll be looking for a

"flip level" in the 1983 area tomorrow

 

does it always go to the "flip level" ? of course,

not . . . but it is a fairly common occurrence.

will it always stop at the "flip level" ? no again,

but one has to let the price action tell him these

things. and most importantly one needs a game

plan and a set of rules to follow

 

a bigger wave does have more meaning than a

smaller one, but its just one step at a time. if

it never gets back to the (1,3) line of the larger

wave, that's okay . . . and certainly not looking

for any (1,4) line move ;-)

 

[waveslider 10]

I see what you are saying, in this case subtract 2 from 3 and then add that amount to 3.

 

So the next step would be to define a flip level. Is it a double, triple test of a level?

 

The initial break of level 3 seems high risk/low reward. It would frequently be a false breakout. Probably the first re-test is the best entry from the opposite side of the flip-level.

 

Have you read the old posts by the chimp on the flip trade?

 

http://www.traderslaboratory.com/forums/34/flip-trade-support-resistance-changing-roles-1714-5.html

[no_sandbags 10]

I see what you are saying, in this case subtract 2 from 3 and then add that amount to 3.

 

So the next step would be to define a flip level. Is it a double, triple test of a level?

 

The initial break of level 3 seems high risk/low reward. It would frequently be a false breakout. Probably the first re-test is the best entry from the opposite side of the flip-level.

 

Have you read the old posts by the chimp on the flip trade?

 

 

well . . . not exactly, the points we are always using are #3 and #4.

 

just as in the original example:

 

1998 - 2038 = -40

 

1998 + (-40) = 1958 --- this IS the "flip level", just flipping #4 to the other side of #3

 

 

the difference between #3 & #4 is subtracted from #3 for a "buy wave",

and added to #3 for a "sell wave"

 

i glanced at the stuff you mentioned, but he's dealing with Keltner Bands,

this is just Wolfe Waves and the relationship between the #3 & #4 pts

 

i'm not telling anybody how to trade, or how to draw their lines, only

suggesting that you pay attention to the relationship between the #3

and #4 pts. quite often it is a way of quantifying where the "sweet zone"

is, and in my experience is much more beneficial than drawing some

line, the value of which is always changing as time goes on . . .

 

just food for thought

[waveslider 10]

in your picture above, the wolfe wave would actually be bearish target line going from 1-4. That assumes the 5 point is a false break.

 

I don't trade WW as I can't quantify me but it always fascinates me how often these patterns work (although my mind probably discards the ones that don't)

[no_sandbags 10]

you don't trade them ? aren't you the one who started this thread ?

 

just joking around . . .

 

okay, just as a bit of follow-up. you're right, the smaller wave at the

end of the day was a bearish (or sell) wave. still, my first assumption

is that its going to its "flip level"

 

this morning price went lower, so the 1958 level was just good for yesterday.

the first thing we want to do is check to see if there are any larger waves

in play, just go to a higher time frame and take a look

 

the following is a 60 min chart and we just go thru the process again

determining the "flip level". you do the math, i'm not making this up

 

just building on what we have learned. of course, one should always

be aware of the largest wave in play, so yes . . . we knew this yesterday

 

 

[brownsfan019 17]

I suppose the same. I was just curious if it was the same brilliant moderator who thinks there can be different implementations of range bars.

.

 

Are you not man enough to call the person out that you think is doing this? Go ahead, let us know who you think was deleting your posts. No need to act like a little child, act like a man and say who you think deleted your posts. Then head to the support area and file a complaint.

 

You are one funny, very disturbed person tresor.

 

[waveslider 10]

Thanks Brownsfan, that is long buried I think.

 

sandbags- I don't trade anything I can't quantify. But I love charts and obscure patterns that demonstrate balance in a market.

 

To make this idea more usable I would use something objective like the VWAP as a "flip level" and find times that price is oscillating around that.

[Tasuki 10]

yes, please no more bickering on this thread. let sleeping rats lie.

[waveslider 10]

This is a pretty convincing WW on the daily timeframe.

 

#2 point is a major high

4-5 move is quick and violent

 

I'm sure many other chartists are seeing this as a head and shoulders breakdown on the weekly chart. Do people still use H&S patterns to trade? Do they use the 50/200 day MA?

 

It's there built into their psychology.

[Tasuki 10]

This is a pretty convincing WW on the daily timeframe.

 

#2 point is a major high

4-5 move is quick and violent

 

I'm sure many other chartists are seeing this as a head and shoulders breakdown on the weekly chart. Do people still use H&S patterns to trade? Do they use the 50/200 day MA?

 

It's there built into their psychology.

 

To answer your question, Tom Bulkowski shows statistics proving that the traditional H&S is a very successful pattern. Also, John Murphy's email today shows the utility of the 50/200 SMA cross.

 

Thanks for the convincing Wolfe Wave on the ES. It'll take a while to play out. What would be your target for point 6?

 

Tasuki

[waveslider 10]

Hey Tasuki, good to hear from you again. Must be getting hot down in SD these days, I heard the water temp got up into the 70's! We're having a little heat spell on the island here too.

 

I do remember that Bulkowski took (downward sloping neckline) H&S as being one of the most successful longer term chart patterns. The 50/200 cross has been discussed quite a bit also.

The problem is that everyone sees these, so back to the age old question - are chart patterns self fulfilling or a product of an underlying dynamic.

With this WW it's the same argument.

The target is there up in the 1140-1150 area.

This 1040 area is previous support, now resistance. If prices flip over it there would likely be a big move higher, since technically the weekly charts are still bullish.

WW does work plenty of times (particularly on lower time frames) , and is pretty accurate, and certainly self fulfilling too. But the dynamic I like about the pattern is the move from point 4 to point 5. If that move is strong enough and scary enough, and you see the pattern forming before hand, the participants in the scary move are like deer caught in headlights.

I'm still more inclined to trust a pitchfork than most chart patterns, then again I personally don't trade chart patterns so I guess I don't trust any of them.

Someday when I have a few little play accounts I would love to just trade patterns, they are fun..

[waveslider 10]

yeah looks like the reason for the rally today was my post yesterday. straight to the moon!

[macdfx 10]

I suppose the same. I was just curious if it was the same brilliant moderator who thinks there can be different implementations of range bars.

 

LOL. You mean former "full-time for a day" mod? :rofl:

 

Anyway, there are range bars and momentum bars. And they are not the same, despite what that so-called mod may think....

 

Back to the topic at hand....

[Tasuki 10]

Hey Tasuki, good to hear from you again.

 

But the dynamic I like about the pattern is the move from point 4 to point 5. If that move is strong enough and scary enough, and you see the pattern forming before hand, the participants in the scary move are like deer caught in headlights.

 

..

 

Hi waveslider,

The way I see it, the move up (or down) to pivot 2 is also designed to drag around people's emotions, and it's the interplay of pivots 2 and 5, pushing traders first one way, then the other, that gives the Wolfe Wave its unique power. In the bullish case, traders are giddy with euphoria going into pivot 2, which by definition (well, my definition at least) has to break into new highs, sucking in the breakout traders. Then they get slammed the other way into pivot 5, scaring the pants off of them and washing every last one of them out of their long positions, which they held through the chop between pivots 2 and 4. Well, that's the way I see the WW.

Tasuki

[BlowFish 10]

What would be your target for point 6?

 

Tasuki

 

I am sure waveslider will correct me if I am wrong but the intersection of 135 & 24 gives a point in time were the move should end (though W put less emphasis on this). By seeing where the target line is at that point in time a potential price can be found.

[waveslider 10]

Hi waveslider,

The way I see it, the move up (or down) to pivot 2 is also designed to drag around people's emotions, and it's the interplay of pivots 2 and 5, pushing traders first one way, then the other, that gives the Wolfe Wave its unique power. In the bullish case, traders are giddy with euphoria going into pivot 2, which by definition (well, my definition at least) has to break into new highs, sucking in the breakout traders. Then they get slammed the other way into pivot 5, scaring the pants off of them and washing every last one of them out of their long positions, which they held through the chop between pivots 2 and 4. Well, that's the way I see the WW.

Tasuki

 

explained perfectly! I think it works even better on markets that are actively traded, where traders get frustrated..