Statistics

[bigbird 10]

Dear Rob,

 

The second chart has the second exception. If a swing in the direction of the higher time frame line is followed by acceptance back beyond the top or bottom 1/8th of the prior swing extreme, then the swing is counted as corrective, even though it's in the direction of the trend. Swing CD is corrective.

 

Is there any reason why the type of B-C in the second chart is not mentioned:question:

 

And in the 3rd attachment is AA-BB impulsive? There's a large retracement and it is part of a 5d range.

 

I have edited the 3rd attachment to include more labels. Are BB-C, C-D and D-E corrective:question:

 

This question is related to Ray's description about R0 subnormal on page 19 of the NOT book. Ray said:

For example, in a 5-day up-move, the 18-day impulse move will be below mean and the 5-day impulse move will be less than average. (A 5-day impulse move usually comprises more than one 5-day impulse move.) In Figure 1.17, we have a 5-day impulse move commencing October 10,2002 and ending on December 2,2002. After the 5-day line turned down, we find that the impulse move is below average. Were there any moves that indicated this may be so before the 5-day turned down? The first 5-day move -- from October 10, 2002 to October 28, 2002 -- is mean. However, the two succeeding 5-day moves are below average, giving us a clue that the 5-day impulse move will also be below average.

 

There is repeated mentions of 5-day which confuses me. Are the underlined words meant to be 18-day instead:question:

 

Thanks for your time.

[gassah 10]

Hi,

 

 

Is there any reason why the type of B-C in the second chart is not mentioned:question:

 

BB-C isn't mentioned because there isn't anything special about it. It's just a normal correction. I used the chart you posted.

 

Are BB-C, C-D and D-E corrective:question:

 

Yes.

 

 

This question is related to Ray's description about R0 subnormal on page 19 of the NOT book. Ray said:

For example, in a 5-day up-move, the 18-day impulse move will be below mean and the 5-day impulse move will be less than average. (A 5-day impulse move usually comprises more than one 5-day impulse move.) In Figure 1.17, we have a 5-day impulse move commencing October 10,2002 and ending on December 2,2002. After the 5-day line turned down, we find that the impulse move is below average. Were there any moves that indicated this may be so before the 5-day turned down? The first 5-day move -- from October 10, 2002 to October 28, 2002 -- is mean. However, the two succeeding 5-day moves are below average, giving us a clue that the 5-day impulse move will also be below average.

 

There is repeated mentions of 5-day which confuses me. Are the underlined words meant to be 18-day instead:question:

 

I'll have to take a look at the book tonight.

[bigbird 10]

Dear Rob,

 

BB-C isn't mentioned because there isn't anything special about it. It's just a normal correction. I used the chart you posted.

 

I'm referring to the chart attached in this post. Is B-C a corrective?

 

 

I'll have to take a look at the book tonight.

 

Thanks!

[gassah 10]

Yes, BC is corrective. BTW, this info is very important for stats calculations.

[gassah 10]

 

This question is related to Ray's description about R0 subnormal on page 19 of the NOT book. Ray said:

 

For example, in an 18-day up-move, the 18-day impulse move will be below mean and the 5-day impulse moves will be less than average. (An 18-day impulse move is usually comprised of more than one 5-day impulse move). In Figure 1.17, we have an 18-day impulse move commencing October 10, 2002 and ending on December 2, 2002. After the 5-d line turned down, we find that the impulse move is below average. Were there any moves that indicated this may be so before the 5-d turned down? The first 5-d move -- from October 10, 2002 to October 28, 2002 -- is mean. However, the two succeeding 5-day moves are below average, giving us a clue that the 5-day impulse move will also be below average.

 

 

I also find the R0 section difficult to decipher and Ray has acknowledged it is the worst written part of the book. I wish he'd come out with another edition. I've edited the quote to something I think makes more sense.

 

Here's some more infomation taken from one of his webinars:

 

R0 CONDITIONS

 

(Assume a new uptrend)

 

1. Takes place usually as a Wave 2; if it takes place after the trend has been an existence for some time. then it is a 50-50 bet it will be a failed move and hence a CIT; or the correction signals that the impulse to follow will be the ultimate high of this time frame.

2. Wave 1 is below normal (i.e. less than mean -1/2)

3. Wave 2 is a deep correction greater than 67% retracement of Wave 1.

4. Wave 3 breaks above high of Wave 1 (may or may not form a WPC).

5. Wave 4 is a deep correction greater than 67% retracement of Wave 3. Sometimes this marks the end of the R0. If not

6. Wave 5 breaks above Wave-3 high (may or may not form a WPC).

7. Wave 6 usually corrects 40% to 60% of Wave 5.

8. When R0 completes the corrective structure we should see strong legs up.

9. The breakout above wave 5 high is usually a Wide Range Breakout Bar.

10. A 6-wave R0 is an exception to my rules to trade responsively. I will take a WRB breakout without a WPC.

11. If a 6-wave up R0 fails expect strong downside continuation.

 

In addition:

 

The strength of an impulse move is related to its correction - from weakest to strongest impulse move: Single line, 3 wave zig-zag, Sideways, Running, Irregular, R0.