The Price / Volume Relationship

[patrader 10]

here's a few recent trading days where i read at least parts of the market day as 'rollin" so that is how i annotated.hth

[stepan7 10]

And this is another way.

 

For me it's too many lines.

 

Chart becomes clouded and it's easy to lose perspective.

 

I found impractical to annotate lower fractals.

 

Switching to 10 minute chart help me to sit on the trade to the end - new p1 and reduced number of trades to a few.

 

Does old timers remember "Hold" button?

 

All above are IMHO of course, nothing personal or pretending to teach someone, just my experience in this business.

 

St.

[patrader 10]

Here's a few more "rollin" charts.I have found that if you can anticipate the market going into a "rollin" mode then you can keep from repeatedly reading ftt's that turn into a zero slope retrace or lateral in grinding market mode conditions. This helps me to stay on the correct side of the market during these market situations.Many times the "rollin" comes after the market has finally broken thru a slow rtl creating a pt 2 in a new direction on increased pace.Then the market "downshifts" into a slightly lower pace level but continues to trend in the new direction just in a decelerated sloped container(rollin) compared to the original breakout container.hth

[patrader 10]

For me it's too many lines.

 

Chart becomes clouded and it's easy to lose perspective.

 

I found impractical to annotate lower fractals.

 

Switching to 10 minute chart help me to sit on the trade to the end - new p1 and reduced number of trades to a few.

 

Does old timers remember "Hold" button?

 

All above are IMHO of course, nothing personal or pretending to teach someone, just my experience in this business.

 

St.

 

Many ways to extract just depends on your personality and resolution level.

[stepan7 10]

Many ways to extract just depends on your personality and resolution level.

 

Yes, you are right.

 

Useful reading BTW - Peterson, Richard L. - Inside The Investors Brain

Edited January 11, 2012 by stepan7

[xioxxio 10]

Here's a few of spydertrader's posts on how he fans containers:"If I need to 'fan out' a channel (when price leaves the channel on decreasing volume) I usually fan from my last Point Three. Not only does the decreased slope of the new (fanned) channel visually represent a reduction in market pace, but using the Point Three vs. recycling the Old Point One normally results in fewer fans as time moves forward. Either way works. Choose whichever you feel best allows you to 'see' the market","When fanning out channels, Jack recycles his previous Point One. Because I look at a need to fan as a slowing down of market pace (and therefore, potentially providing an opportunity for the market to begin to roll over), I choose instead to recycle Point Three's into new Point One's. Doing so causes me to have to 'fan' less often, and allows me to 'see' the change in pace better. During the time frame you posted above, my original Point Three started waaaaay back. To me, recycling from that point, so far away, didn't make sense. Instead, I chose to recycle from an FBO that bounced off the RTL. In this fashion, I mirrored the use of a 'Point Three' - just further down the line. In other words, Any time I have Price return to the RTL, only to bounce directly off and move higher, I consider using that point as a new Point One, if need be - especially when the Points One and Three started so far back in the day from where I need the fan.","I 'recycle' my Point Three into a New Point One, rather than, use the Original Point One because I 'see' the market in terms of 'rolling through' various points instead of starting and stopping on those points of change. I annotate my channels in real time, and when Price breaks a RTL on decreasing Volume, we often have yet to see the end of the current trend. In other words, the channel needs changing because the trend did not change. When a particular channel continues on for quite some time, I may need to use the most recent 'trough' of Price (most likely a flaw, but could be an FBO point) for the New Point One - rather than go all the way back to the Point Three. This is the way I fan my channels as I feel it gives me the best view of the actual market. Others, who may view things differently might draw their fanned channels differently.","When the market 'rolls over' or 'rolls under' fanning from (recycling) the Point Three more accurately represents these changes. Jack refers to these changes as 'saucer shape' formations","The market tells us if we have correctly contained Price within our channels. One need look no further for confirmation on correct fanning than the market itself. Numerous examples exist each day showing how the channel has changed, but the trend did not. This occurs on every fractal, resolution and time frame","By fanning outward (channel deceleration), we show the intact trend (i.e. one which has not changed direction long or short), but we also contain the altered money velocity (we no longer profit as much per unit time as we once did). In other words, we haven't stopped making money, we just don't make it at the same rate as before","And 'fanned' channels always do fit into larger containers. Whether or not those larger containers assist the trader to either better 'see' the market, or enable the trader to bank more profits remains a matter of experience.

 

Choosing to recycle a Point Three into a New Point One, or to 'fan' using the original Point One remains a matter of personal preference. For me, I 'see' the market as 'rolling over' from Point to point, and as a result, recycling Point Three makes better sense to me. However, someone else, who 'sees' things from a slightly different perspective might find 'fanning' from the same Point One provides better clarity.

 

Again, two different paths which cause two different traders to arrive at the exact same place." hth

 

 

If you remember a while back I raised the whole issue of fanning out of pt.3

 

I am not sure how old the above is comments from Spyder are?

 

Towards the end of his postings the charts that had fanned out/ rolling pt3, Spyder created a new 1,2,3 and kept the original 1,2,3 in place.

 

hth.

[xioxxio 10]

Great rolling action in the SPI today.

[stepan7 10]

Here's a few of spydertrader's posts on how he fans containers:"If I need to 'fan out' a channel (when price leaves the channel on decreasing

 

[skiped]

 

find 'fanning' from the same Point One provides better clarity.

 

Again, two different paths which cause two different traders to arrive at the exact same place." hth

 

Could you please provide a link to authoritative source?

 

St

Edited January 12, 2012 by stepan7

[Tams 20]

Could you please provide a link to authoritative source?

 

St

 

click here

... authoritative source

 

 

 

 

.

[SK0 10]

It seems you did really good work chasing the elusive "lateral exit" rule, and although you didn't solve it at your satisfaction I'm sure you didn't spent all that time in vain.

 

It is definitely possible to correctly annotate without knowing in advance the direction of a lateral formation exit, and even completely ignoring all laterals.

 

As with most signals and key words used with this method to describe the market, it's easy to cross the boundaries of anticipation into prediction, which obviously goes against the spirit of the method.

 

Even if you can't "predict" the direction the price will exit a lateral, this shouldn't alter in any way the order you expect the events to unfold: 1-2-3-ftt, as the volume and price define them.

 

It seems that occasionally laterals end their scope before the price closes consecutively twice outside their boundaries, and continuing to look at them as lateral formations beyond that point can be misleading.

 

Obviously, all these are my interpretations of the method under discussion here, and shouldn't be interpreted more than such.

 

:dito In general, I treat lateral formations as non-dominant moves. I should be in good shape to know that trading fractal continues if the exit (BO) direction is the same as the entry direction and end if the exit direction is opposite of the entry direction. FBO is interesting.

[stepan7 10]

click here

... authoritative source

.

 

Nice.

Search is redundant.

It's mean that patrader provide a freewill compilation of Spadertrader’s words.

 

 

If you remember a while back I raised the whole issue of fanning out of pt.3

 

I am not sure how old the above is comments from Spyder are?

 

Towards the end of his postings the charts that had fanned out/ rolling pt3, Spyder created a new 1,2,3 and kept the original 1,2,3 in place.

 

hth.

 

And xioxxio is 100% right.

 

When I asked about fan - not fan - Spydertrader told me exactly same thing.

 

St.

[vienna 10]

:dito In general, I treat lateral formations as non-dominant moves. I should be in good shape to know that trading fractal continues if the exit (BO) direction is the same as the entry direction and end if the exit direction is opposite of the entry direction. FBO is interesting.

 

Here is one more schematic I did... the blue bar denotes where I would expect strength to occur within the Lat ("the thing"), either by boundary, inc volume or whatever (the 40 or so cases prev. mentioned)... is just a draft (for example, I am not sure about case "e" etc...

 

Comments appreciated...

LATS LONG.pdf

LATS SHORT.pdf

[patrader 10]

Could you please provide a link to authoritative source?

 

St

 

Forums - Spydertrader's Jack Hershey Futures Trading Journal Forums - Spydertrader's Jack Hershey Futures Trading Journal Forums - Spydertrader's Jack Hershey Futures Trading Journal Forums - Iterative Refinement Forums - Spydertrader's Jack Hershey Futures Trading Journal

[cnms2 10]

Another way of looking at the lateraldrill snippet.

[SK0 10]

Here is one more schematic I did... the blue bar denotes where I would expect strength to occur within the Lat ("the thing"), either by boundary, inc volume or whatever (the 40 or so cases prev. mentioned)... is just a draft (for example, I am not sure about case "e" etc...

 

Comments appreciated...

 

Personal opinion.

 

I feel that you are not going to reach any sound conclusion with your lateral-exit-direction study based on "cases" inside Lateral Formations.

 

Only the CONTEXT can help to tell you the exit direction of a lateral formation. I mean where the Forming Lateral is located in both Traverse and Channel containers, dominant or non-dominant. There are limited places where Laterals form.

 

If you are interested in "cases", may be you want to study deeper into the completion of fast fractal Pattern inside Lateral formations. However, the horizontal boundaries could serve to FAN or contain the faster fractal Pattern inside a Lateral.

 

[xioxxio 10]

study deeper into the completion of fast fractal Pattern inside Lateral formations:

 

That is exactly how I make any sense of laterals.

[vienna 10]

Personal opinion.

 

Only the CONTEXT can help to tell you the exit direction of a lateral formation. I mean where the Forming Lateral is located in both Traverse and Channel containers, dominant or non-dominant. There are limited places where Laterals form.

 

If you are interested in "cases", may be you want to study deeper into the completion of fast fractal Pattern inside Lateral formations. However, the horizontal boundaries could serve to FAN or contain the faster fractal Pattern inside a Lateral.

 

 

OK, and thanks for the suggestion!

 

Perhaps there was a misunderstanding re my schematic: It was not intended to show "lateral-exit-direction study based on "cases" inside Lateral Formations".

It was intended to show where you would expect strength to occur based on the location of the Lat (which seems to be the approach you recommend as well).

Perhaps "cases" was the wrong word, since one immediately connects it to the tape cases. Call them scenarios. One spends a lot of time on these forums clarifying semantic issues it seems....

 

So, I was trying to break the problem into 2 levels:

1. The Context/ Order of things

2. The Thing itself

 

Context (1.) tells you which direction the lat is likely to break to, the Thing (2) should reinforce that, by showing strength in the anticipated direction. (If everything were only a question of context, why did Spyder spend so much time to have people differentiate "the thing", such as the difference between Sym lats, Sym Lats with boundary etc. etc.?)

 

Having said that, the question of how you differentiate "the thing itself" is a separate Subject. I had posted some graphics before which tried to approach this.

In the end, ot might very well be solved by looking at the completion of a fast fractal within the lat, as you suggest.

Also, cnms told me that he felt you could annotate just ignoring the lats...which seems like a possible approach as well.

I am still working from the assumption that what Spyder says in the thread-that you can know clearly and binary how any lat will exit, not perhaps, maybe etc.- is meant literally.

 

 

hth,

 

Vienna

[vienna 10]

Another way of looking at the lateraldrill snippet.

 

Please see attached...

unless I misunderstood what you intended...

[gosu 10]

I think the suggestion was to not over complicate as you seem to enjoy doing.

[xioxxio 10]

I think the suggestion was to not over complicate as you seem to enjoy doing.

 

It seems he is trying to build a rule base; if...then....else

 

If the above is possible (which I believe it is) it could be programmed into a trading system.

 

The best way to do it is data mining and work with probabilities. Advanced GET software is based on such probabilities.

 

If you do take on such a task, accurate data is critical.

[cnms2 10]

Please see attached...

unless I misunderstood what you intended...

If you meant "color" when you wrote "direction", I think we determine the color of any bar based on its extremes in relation to the precedent bar's extremes. I don't quite understand your if-then reasoning. Also, you don't present actual chart snippets, so it is more difficult to analyze them.

 

Do you, or does anybody have a collection of quotes from Spydertrader posts (with links and time stamps) about being 100% certain about the direction price will exit a lateral formation? It might be beneficial to re-read the Master's words.

[vienna 10]

m.

 

Do you, or does anybody have a collection of quotes from Spydertrader posts (with links and time stamps) about being 100% certain about the direction price will exit a lateral formation? It might be beneficial to re-read the Master's words.

 

Quote:

"Originally Posted by saturo »

"Is the BO direction ALWAYS knowable as soon as price tells us we have a lat?"

 

Yup, and without exception. Probably why I keep encouraging people to work through the process of Lateral Differentiation.

 

I designed The Lateral Formation Drill (and its follow up) to remind people to learn to differentiate ...

 

1. Context

2. Order of Events.

3. and then the thing (in this case laterals).

 

HTH.

 

- Spydertrader "

 

End of quote, pge 144.

 

(Italics and underline are mine).

 

So, I took this to mean what it says...However, it seems that we can not even agree on:

 

1. you can actually anticipate the exit direction of a lat (at least 2 people told me that that they thought that "this is not really what Spyder meant"),

 

2. the process depends on the differentiation of:

a. Context/Order of Events.

b. and then the thing (in this case laterals)

It seems that either people think that this is not possible, or that it comes from my desire to "overcomplicate things".

 

All I had tried is to differentiate a and b.

What I had actually hoped to find here was someone who had actually completed the process that Spyder suggested, and who could therefore perhaps provide some guidance.......??

 

best,

 

Vienna

[gosu 10]

I get where you're coming from a bit better now.

 

In my experience, the premise just doesn't hold. However, it's not my intention to discourage you.

 

Good luck.

[cnms2 10]

Quote:

"Originally Posted by saturo »

"Is the BO direction ALWAYS knowable as soon as price tells us we have a lat?"

 

Yup, and without exception.

 

... Vienna

From this quote and some additional browsing of those pages, it sounds that it should be possible to make that prediction indeed, at least for that subset of laterals. However, my personal belief is that in principle it can't be done with 100% certainty, even for that subset. Anyway, I wish you good luck!

[SK0 10]

OK, and thanks for the suggestion!

 

Perhaps there was a misunderstanding re my schematic: It was not intended to show "lateral-exit-direction study based on "cases" inside Lateral Formations".

It was intended to show where you would expect strength to occur based on the location of the Lat (which seems to be the approach you recommend as well).

Perhaps "cases" was the wrong word, since one immediately connects it to the tape cases. Call them scenarios. One spends a lot of time on these forums clarifying semantic issues it seems....

 

So, I was trying to break the problem into 2 levels:

1. The Context/ Order of things

2. The Thing itself

 

Context (1.) tells you which direction the lat is likely to break to, the Thing (2) should reinforce that, by showing strength in the anticipated direction. (If everything were only a question of context, why did Spyder spend so much time to have people differentiate "the thing", such as the difference between Sym lats, Sym Lats with boundary etc. etc.?)

 

Having said that, the question of how you differentiate "the thing itself" is a separate Subject. I had posted some graphics before which tried to approach this.

In the end, ot might very well be solved by looking at the completion of a fast fractal within the lat, as you suggest.

Also, cnms told me that he felt you could annotate just ignoring the lats...which seems like a possible approach as well.

I am still working from the assumption that what Spyder says in the thread-that you can know clearly and binary how any lat will exit, not perhaps, maybe etc.- is meant literally.

 

hth,

 

Vienna

 

Just a suggestion. Group samples of Lateral Formations according to the Context/OOE.