Sandbox

[Copycat 10]

Hi,

 

What will I have to do if I want to speculate (on large swings) with European stocks? Can leaders be found in Europe? Or are leaders American stocks exclusively? Is an European Index good enough as a proxy for a general market trend?

 

I guess the term leader is kind of unclear to me. I heard someone saying that European stocks are lagging behind American stock. With this in mind, focusing on American stocks would be better.

 

I love this Wyckoff section btw. (enough buttkissing :p)

[DbPhoenix 42]

Hi,

 

What will I have to do if I want to speculate (on large swings) with European stocks? Can leaders be found in Europe? Or are leaders American stocks exclusively? Is an European Index good enough as a proxy for a general market trend?

 

I guess the term leader is kind of unclear to me. I heard someone saying that European stocks are lagging behind American stock. With this in mind, focusing on American stocks would be better.

 

I love this Wyckoff section btw. (enough buttkissing :p)

 

Leaders can be found in any market. If, for example, you were interested only in financials, you could trade the leaders in financials (though you'd have to determine the position of the general market in order to determine whether or not financials provided a trading opportunity at all). If you're looking at an entire index, the procedure for finding the leaders is the same as anywhere else. A more important concern might be liquidity, i.e., is there enough interest in the index to provide opportunities?

 

In this particular case (the American market), one looks for those stocks which have moved farthest and fastest in the Dow (one could also use some other market average, but the Dow theoretically is a proxy for the market as a whole, and it's comprised of only 30 stocks, which makes the job easier). One can do this by looking at MAs, Slope, ROC, or by just eyeballing it (the eyeballing is generally the most accurate). Or one can let someone like StockCharts do the work. SC compares whatever you want to compare across whatever timeframe you want to make the comparison by means of its "Performance Charts" function.

 

As for speculating in large swings, see the Groups thread to get started, then take a look at the Trading Off Daily Charts thread (there will likely be much in the latter thread that you can skip).

 

I'm glad you're enjoying the forum

Edited May 27, 2009 by DbPhoenix

[innovation1520887469 10]

I know that's how Wyckoff and Dow did it, but it seems that this method weights stock prices that are high (which can be rather arbitrary) much heavier (e.g. ACME is at $50, DYNO is at $20, both are similar sized companies, but ACME is weighted in the index 2.5x greater). It could be that normalizing the data was too computationally intensive in the early 1900s.

 

I'm sure it's not a huge deal, or Wyckoff would have given it some notice, but it might give a better picture of the constructed index.

 

I thought the same thing (the elements should be normalised to show relative changes) but then on reflection thought that the actual $ value shows how much money is moving around to provide support or otherwise. It might be interesting to see if what the differences are, if any.

[DbPhoenix 42]

I thought the same thing (the elements should be normalised to show relative changes) but then on reflection thought that the actual $ value shows how much money is moving around to provide support or otherwise. It might be interesting to see if what the differences are, if any.

 

Anyone who wants to weight them is welcome to do so. I used to, but I didn't see enough difference to make the effort worthwhile, partly because the point is to determine relative performance and partly because the composition can change fairly often. If the composite isn't doing what it's supposed to do (i.e., act as a canary), one will know pretty quickly.

 

One can also just find the five leaders (or, in this case, four or six), follow their charts, and combine them in his head.

[mlb_trader 10]

I don't know if anyone has posted this information (Ed: see next post) but if you go to the SMI site on yahoo (files section), someone converted the bars for "Analysis of 1930-31 charts" into csv form. It makes going through the PDF much easier when you can draw trendlines, volume at price etc. using your own charting package. Hope this helps

Edited June 5, 2009 by DbPhoenix

[DbPhoenix 42]

I created that file almost 10 years ago when I took the SMI course. It took some judgment and lots of time to extract the H,L,C and Volume, but I did my best. Please note that I doubled the Volume on the Saturday sessions and I used the SMI Section 7 chart as the basis. I noticed some time later that there were some minor discrepancies between the SMI chart and Wyckoff's original chart.

 

Always good to see credit go where it's due. And I know what you mean by the "lots of time" part. I've restored a number of charts in the original course, and in many cases it's bar by bar by bar.

 

But it's a kind of therapy as well. Like basket-weaving.

[disperados-x 10]

Always good to see credit go where it's due. And I know what you mean by the "lots of time" part. I've restored a number of charts in the original course, and in many cases it's bar by bar by bar.

 

But it's a kind of therapy as well. Like basket-weaving.

 

Db!

What is the difference between SMI course Hank Pruden "Analyzing the Price and Volume Movement of Market Tradable Item According to the Principles of Mass Psychology" and the SMI Stewart Taylor course "Wyckoff Analysis, The art Price and Volume"? What does Pruden and Taylor to the Wyckoff Stock market institute?

[DbPhoenix 42]

Db!

What is the difference between SMI course Hank Pruden "Analyzing the Price and Volume Movement of Market Tradable Item According to the Principles of Mass Psychology" and the SMI Stewart Taylor course "Wyckoff Analysis, The art Price and Volume"? What does Pruden and Taylor to the Wyckoff Stock market institute?

 

The differences among all the variations to Wyckoff's original work range from few to many, whether they be Evans, Pruden, Ross, Darvas, Dunnigan, Steidlmayer, Williams, or any of a number of other people. To explore them all would be exhaustive and might even be interesting. But the task would be irrelevant to the Wyckoff Forum.

 

When one begins an investigation of something, whether he's a researcher, a student, a reporter or whatever, it is important to begin with the source material. If one is beginning an investigation of Wyckoff's approach, then the source material becomes whatever Wyckoff himself wrote, not on what somebody else wrote based on Wyckoff wrote (including me). One can then, if he so chooses, move on into some variation or adaptation or interpretation of Wyckoff (the same applies to reading Dow before moving on to Hamilton, or Schabacker before moving on to Edwards and Magee). Or he may be more than happy to work with the original material and come up with his own variations on the themes (as I've done with my boxes, though doing no more than drawing a box around a range that's been defined according to Wyckoff isn't that much of a variation). Those are the trader's choices.

 

But to begin with the adaptations or variations or whatever one wants to call them and deny the trader access to the original material is to assume that one knows best what the trader ought to know. That's why -- all the posts and threads and charts aside -- the core of the Wyckoff Forum is Wyckoff's own material. The trader can ignore every single post, every single attachment and instead focus on Wyckoff's work alone, forming his own hypotheses and coming to his own conclusions without prejudice or bias or preconception.

 

The benefits of studying the original material can be seen by comparing recent efforts to sell a newsletter that was allegedly Wyckoff but was actually an adaptation. Only two trades were made in five weeks, both losers. But those who had not read the adaptation and focused on the original material provided more accurate analyses and had, instead, winning trades. Even so, those who want to discuss these adaptations and variations are welcome to do so. I ask only that they not do it here since this is, again, a forum for discussing the original material. While this may seem "heavy-handed" to some, it is primarily a matter of focus.

 

Wyckoff is simple, straightforward, and essentially plain-speaking. Though there are terms that are used in a particular way (like "climax" or "test"), he couldn't care less what term you use to describe something as long as you understand what's happening (see all the synonyms he provides for apex, hinge, wedge, dead center, etc). To say that it's simple, however, is not to imply that it's easy. Even though charting software has been available to the average retail trader for only ten years, a trading culture that is based on bars of various sorts and indicators of a near-infinite variety has entrenched itself so thoroughly that few beginners are able to conceptualize price movement in any way other than by some type of bar, and to be able to conceptualize price movement independently of whatever means one chooses to illustrate it or record it is crucial to implementing the Wyckoff approach. Otherwise, one risks joining the camps of those who believe that, for example, just because they have volume plotted on their charts that they are "doing Wyckoff" or who are forever trying to determine what a particular bar "means".

 

A long-winded answer that very likely tells you far more than you want to know about the subject, but I'd like to lay this to rest. Those who want to discuss Evans, Pruden, etc are welcome to do so elsewhere (though when that opportunity was recently provided, nobody pursued it). It isn't as though I'm going to insist that interested parties be gagged and thrown into a closet. The Wyckoff Forum is about Wyckoff. Therefore, if you truly want to grasp the concepts, I suggest you begin with the Stickies to the forum, then move on to the sections on volume and group strength, as suggested earlier. If you need illustrations, explore the "Most-Thanked Posts" Stickie. If you have further questions (and you very likely will), ask. There are a number of people who are working their way through this along with you and will be happy to be of assistance.

Edited April 26, 2012 by DbPhoenix

[disperados-x 10]

Db,

 

Thank you for unrolled answer! I am pleased existence of the similar forum due to, which possible get and be divided by greater information on Wyckoff method!

Edited June 6, 2009 by disperados-x

[DbPhoenix 42]

Db,

 

Thank you for unrolled answer!

__________________

Taylor and Pruden wrote SMI course from their own thoughts or all their work came out of Wyckoff Stock market institute? Possible these work to consider the original course Wyckoff Stock market institute?

 

Perhaps the only way of answering this satisfactorily is for you to obtain the Taylor course, the Pruden material, the SMI course, and the original Wyckoff course in its entirety and make the comparisons yourself. Otherwise you're in the position of relying on somebody else to tell you what you should know rather than relying on your own work to make that determination.

 

Some may say that I myself am setting myself up as someone who is telling you what you should know, and if the Wyckoff material weren't here, then that would be true. However, it is here, and one can study it at his leisure without paying the slightest bit of attention to anything I say about it.

 

Therefore, if you want to spend the money to buy other courses and materials, nobody's going to tell you that you can't. It is, after all, your money and your time. But I'm not in a position to advise you on those purchases.

 

(Note: seems I posted this before you posted your edit. However, what I've posted above still applies to anyone who wants to do more than trade the market superficially.)

Edited June 29, 2009 by DbPhoenix

[disperados-x 10]

Perhaps the only way of answering this satisfactorily is for you to obtain the Taylor course, the Pruden material, the SMI course, and the original Wyckoff course in its entirety and make the comparisons yourself. Otherwise you're in the position of relying on somebody else to tell you what you should know rather than relying on your own work to make that determination.

 

Some may say that I myself am setting myself up as someone who is telling you what you should know, and if the Wyckoff material weren't here, then that would be true. However, it is here, and one can study it at his leisure without paying the slightest bit of attention to anything I say about it.

 

Therefore, if you want to spend the money to buy other courses and materials, nobody's going to tell you that you can't. It is, after all, your money and your time. But I'm not in a position to advise you on those purchases.

 

(Note: seems I posted this before you posted your edit. However, what I've posted above still applies to anyone who wants to do more than trade the market superficially.)

 

I have edited the message since have understood not correction its question. I have understood that you not introduce;make familiar with with material these course Stewart Taylor and Pruden. Itself I their already studied. Particularly course Pruden SMI and book Behavorial Skill, with S.Taylor I while sign less. In course SMI from Pruden I have found the general principles from Behavorial Skill and separate parts from the other work possible most Wyckoff - absorption, hypodermix, stopping volume and others, but they were without explanations (only pictures). I it is difficult to judge about that pertain these notions to original Wyckoff. Since from his(its) original work I sign only with Studies tape reading (in her is not revealled essence of the method trading range) and Investing in stock and bonds (little useful information). But read Coppola, Forte, Pruden, Williams, Taylor, Hutson, Db. So I should like to honour Stock market technique. I seem in her are stated main notions trading range (the type hypodernix, absorption, springboard and other) in original Wyckoff. I am a rights? Itself I bad know english so paper texts for me not available since translation by means of computer translator.

Edited June 6, 2009 by disperados-x

[DbPhoenix 42]

I have edited the message since have understood not correction its question. I have understood that you not introduce;make familiar with with material these course Stewart Taylor and Pruden. Itself I their already studied. Particularly course Pruden SMI and book Behavorial Skill, with S.Taylor I while sign less. In course SMI from Pruden I have found the general principles from Behavorial Skill and separate parts from the other work possible most Wyckoff - absorption, hypodermix, stopping volume and others, but they were without explanations (only pictures). I it is difficult to judge about that pertain these notions to original Wyckoff. Since from his(its) original work I sign only with Studies tape reading (in her is not revealled essence of the method trading range) and Investing in stock and bonds (little useful information). But read Coppola, Forte, Pruden, Williams, Taylor, Hutson, Db. So I should like to honour Stock market technique. I seem in her are stated main notions trading range (the type hypodernix, absorption, springboard and other) in original Wyckoff. I am a rights? Itself I bad know english so paper texts for me not available since translation by means of computer translator.

 

Yes, language can be a bitch, but we'll keep at it

 

And, yes, examples mean more than verbal explanations. A picture's worth a thousand words and so on.

 

So, let's move on to your specific concerns rather than go on again about concepts.

 

Absorption is first addressed in Section 7, p 8.

 

Hypodermics are first addressed in Section 7, p 11, and Section 8, pp 5 and 15.

 

Springboards are addressed in thirteen different sections, beginning with 4 (not posted here), 7, and 8. Use Ctrl+F to locate the specific pages. You can also refer to the springboards section of my blog.

 

As for "stopping volume", this is not mentioned in Wyckoff's course, though it's pretty self-explanatory, i.e., volume which is heavy enough to stop price in its tracks. This type of volume can often be found in climaxes, though it often occurs shortly after what appears to be -- at the time -- climactic volume.

 

If there's anything more than doesn't have to do specifically with Wyckoff Resources, feel free to take advantage of the Ask Any Wyckoff-Related Question or Trading the Wyckoff Way, or any other thread which may be more specifically related to your question. Annotated charts are probably going to mean a lot more to you than more verbal explanations.

[disperados-x 10]

Yes, language can be a bitch, but we'll keep at it

 

And, yes, examples mean more than verbal explanations. A picture's worth a thousand words and so on.

 

So, let's move on to your specific concerns rather than go on again about concepts.

 

Absorption is first addressed in Section 7, p 8.

 

Hypodermics are first addressed in Section 7, p 11, and Section 8, pp 5 and 15.

 

Springboards are addressed in thirteen different sections, beginning with 4 (not posted here), 7, and 8. Use Ctrl+F to locate the specific pages. You can also refer to the springboards section of my blog.

 

As for "stopping volume", this is not mentioned in Wyckoff's course, though it's pretty self-explanatory, i.e., volume which is heavy enough to stop price in its tracks. This type of volume can often be found in climaxes, though it often occurs shortly after what appears to be -- at the time -- climactic volume.

 

If there's anything more than doesn't have to do specifically with Wyckoff Resources, feel free to take advantage of the Ask Any Wyckoff-Related Question or Trading the Wyckoff Way, or any other thread which may be more specifically related to your question. Annotated charts are probably going to mean a lot more to you than more verbal explanations.

 

Thank you Db!

You may briefly describe the contents of the book Wyckoff -Stock Market Technique? Never read this book, there is in her description of the action in trading range and main notion glossary Wyckoff? Cost(stand)s her(its) read for the best assimilation philosophy Wyckoff and his(its) notion, or it is enough information this Wyckoff forum, SMI course, and opinions Pruden, Coppola, Forte, Williams and others?

[disperados-x 10]

Has Read the reviews about Stock Market Technique on Amazon. The Conclusion - in book one Philosophy not revealling essence of the method Wyckoff. There is beside Wyckoff books which reveal the essence of his(its) methods to trade or this only in SMI course?

[DbPhoenix 42]

Thank you Db!

You may briefly describe the contents of the book Wyckoff -Stock Market Technique? Never read this book, there is in her description of the action in trading range and main notion glossary Wyckoff? Cost(stand)s her(its) read for the best assimilation philosophy Wyckoff and his(its) notion, or it is enough information this Wyckoff forum, SMI course, and opinions Pruden, Coppola, Forte, Williams and others?

 

Has Read the reviews about Stock Market Technique on Amazon. The Conclusion - in book one Philosophy not revealling essence of the method Wyckoff. There is beside Wyckoff books which reveal the essence of his(its) methods to trade or this only in SMI course?

 

I no longer have any of my Wyckoff books. I was introduced to Wyckoff in the late 90s and the material made so much sense to me that I knew I'd be wasting my time with anything else. So I bought everything I could find that Wyckoff had written (nearly all of which is available on Amazon), but, even though I got a relatively good idea of Wyckoff's thoughts regarding the markets and market participants and so forth, it wasn't specific enough. I didn't know how to translate all that into a trading strategy. The most valuable book in that regard, until I obtained a copy of W's course, was the Hutson book, Charting the Stock Market.

 

As to what is enough, I guess that depends on how interested you are in the approach. Certainly anything that W wrote would add to your knowledge of and appreciation of how he approached the market and trading. But is it necessary to read all that? No.

 

As to the glossary, there's one here.

 

As to how to interpret the action in a trading range, I can think of a couple of examples offhand -- there's one here and here regarding the trading range that occurred in the NQ in May and a series of posts beginning here that address the behavior of price in a hinge, which is a special kind of trading range/springboard -- but there are more. Perhaps other members might remember an example in one of the threads that stuck with them and helped clarify something for them. I also suggest, again, the Most-Thanked Posts Sticky, which is only 60 or so posts as opposed to a thousand. Once you've real all that, plus the other stickies, plus the threads in the forum, plus my blog, then you'll know whether or not you need to buy books.

 

Note: Wyckoff goes into the process of trend, rest, trend, rest, trend, rest, the rests being trading ranges or springboards or both. But Auction Market Theory goes into the why trading ranges occur in the first place, and understanding that might help you understand what's going on and why in whatever range you're looking at.

Edited January 29, 2010 by DbPhoenix

[DbPhoenix 42]

Visiting the canaries:

 

 

 

 

 

 

 

[jonbig04 10]

Interesting DB, looks like the market as a whole is at a very important area. The January high of the S&P was right around 940, which is just under where the current rally has stalled a bit. We did have that spike up to 957 on globex, but clearly demand wasn't there as it quickly dropped back into the 933-947 range. Considering the time frame, I think its safe to say that the whole 940 area is potentially very powerful resistance. I'm not one for "calls" or predictions, but if I had to say I would think that this area presents possibly the most significant area of resistance in a long time and I wouldn't be surprised to see it break down a bit, especially with the (as you've showed) market-wide confluence.

[uexkuell 10]

Or we have a lot of buyers buying at the bid or there is clearly something i am missing here.

 

May I ask which quote feed you are using?

 

Big boys have sophisticated infrastructure at their hands that allows them to disguise whether they traded at bid or ask, especially (but not necessarily) if you look at it with a feed that sometimes lags.

 

Just imagine that their software can shoot impulses of trades that are coming in so fast that the quote feed cannot adjust the dom stack (especially level 0 - bid and ask) fast enough.

 

This way every software or trader that relies on bid/ask-relations can get highly confused.

 

Perhaps also reasons for strange observations:

- Rollover close for ESTX (block trades happening)

- Some major change in the market on the way

[monad 10]

If by "rising market" you mean price that is rising after having bounced off support, then it's actually the opposite, i.e., demand has overcome supply, or, more exactly, sellers are done and demand is allowed to move price higher without being impeded.

 

Again, it's always more helpful to have a chart. But there are plenty of examples available already. See the Volume Observation thread, for one.

 

Actually meant prices have risen for a while i.e trend has been underway with a couple of higher lows and higher highs.

But you are right if the price has just bounced off the support, than the scenario you just outlined would be relevant.

 

Anyway all this would benefit if the person makes some effort to put up charts and make an effort to go through some of the excellent threads on your forum especially the volume thread and trading the wyckoff way just to highlight two, IMO

[DbPhoenix 42]

 

Anyway all this would benefit if the person makes some effort to put up charts and make an effort to go through some of the excellent threads on your forum especially the volume thread and trading the wyckoff way just to highlight two, IMO

 

I forget, however, that there are a number of ways to find new posts and threads and work one's way into various forums, and facc may not be posting in the right place. I should point out, then, that this particular approach couldn't care less about bid and ask volume. Unless and until there's a transaction, the "intent" is irrelevant.

 

Those who are interested in volume -- including those who have become discouraged by the whole bid and ask thing -- can look at the thread I linked to earlier, and/or the Volume Studies pdf.

 

Those who are instead interested in LII and so forth will find boatloads of information on it in other forums. But the Wyckoff Forum, at least in terms of LII and other forms of bid and ask, is a dry well.

[brownsfan019 17]

To answer the OP's question of 'how important is volume really?' my reply would be - it's not important at all.

 

 

I have no indicators of volume nor volume itself anywhere on my charts.

 

So that's one side of the coin for you. Others would say the exact opposite.

[DbPhoenix 42]

To answer the OP's question of 'how important is volume really?' my reply would be - it's not important at all.

 

I have no indicators of volume nor volume itself anywhere on my charts.

 

So that's one side of the coin for you. Others would say the exact opposite.

 

OTOH, volume is central to the Wyckoff approach. And this is the Wyckoff Forum. Those who are interested in Wyckoff will also be interested in volume. Those who aren't, maybe not. One can assume, however, that anyone who posts here is. Unless they got lost.

[Tams 20]

The OP is asking the question in The Wyckoff Forum...

I would assume he is asking in reference to the Wyckoff method,

If the OP is asking the question in general, this thread should then be relocated to the Technical Analysis Forum so that "other" opinions can chime in.

[DbPhoenix 42]

The OP is asking the question in The Wyckoff Forum...

I would assume he is asking in reference to the Wyckoff method,

If the OP is asking the question in general, this thread should then be relocated to the Technical Analysis Forum so that "other" opinions can chime in.

 

That's up to the OP. I suspect, like all other members, that he already has a mother.

[thalestrader 14]

I do not use volume myself. I do think that one can gain a good deal from studying Wyckoff's writings even if one does not incorporate volume as an indicator used in the decision making process. I believe I owe much to my reading of Wyckoff, and I do consider myself a Wyckoff influenced trader, even if I do not pass muster as a Wyckoff trader as defined by those who are the arbiters of such definitions.

 

The old saying, if I remember correctly, is that "price follows volume." I would suggest that that is backward, and in reality, "volume follows price." Here is one of my favorite stocks of the last three months. It came on a screen I run each night using Worden Brothers Telechart 2007. I put volume on the chart for this post, but I do not usually have volume showing. This stock came on my screen eod 3/30/3009. It is up 1203% since then. I do not have volume as part of the screening criteria. My criteria is based upon price movement only.

 

I post this only to demonstrate that one can make good trading decisions based upon nothing other than price movement without considering volume. I do not mean to imply that volume may not have value in making trading decisions.

Edited June 18, 2009 by thalestrader
typos