The Price / Volume Relationship

[Spydertrader 10]

So in Neoxx's example with price blocked out and with the gaussians drawn in we should know it was a traverse. On other examples, (of traverses) it might not be so clear.

 

Absolutely correct. In this example, Volume told you everything required to arrive at a correct decision. In most every other example, such is not the case. Hence, Jack's frequent posts on, "how one could almost do this with Volume alone."

 

- Spydertrader

[Spydertrader 10]

Could you post a few charts with examples of tapes on them, that look like traverses

 

It appears you continue to miss my point.

 

Whatever something "looks like" in the Price Pane falls under the catagory of unimportant because a tape does not ever look like a traverse (or anything else) when observing the Volume Pane.

 

You can call something a tape, traverse or channel (hell, call it a goat if you like) by looking at a Price Pane, but Volume always indicates exactly what the market has built for you to see.

 

Without exception.

 

Three choices exist, and we call these three choices tapes, traverses and channels (skinny, medium and thick; or L1, L2 & L3 if you prefer different nomenclature).

 

No more 'Chubby' tapes.

No more 'Faster Fractal' Traverses.

No more Lateral 'Movement.'

 

Tapes build Traverses and Traverses Build Channels.

 

Again, whatever something "looks like" in the Price pane does not matter in the slightest. The Gaussians always tell you what the market has created.

 

Without a doubt, if asked, a roomful of traders would provide as many answers with respect to what the market created across most of today (7-20-2009). Again, if one chooses to look at what today's 'something' "looks like" by observing the Price Pane, a variety of opinions develop. However, only one possible accurate answer exists, and it resides in the signals the market has provided in The Volume Pane.

 

HTH.

 

- Spydertrader

[Neoxx 10]

It is great to have an active discussion of the method again. It is entirely possible to have a sharp, clear discussion without resorting to things 'pissy and snippy', such as condescension, ad hominems, misrepresentations, etc. It is most frequently the arrogance of ignorance which gives rise to such manoeuvers and as true discussants of the method we are above all that.

 

With respect to these methods, I agree that discussion can be valuable if one party is a definitive source (aka transference). Otherwise, the perceived benefit differs enormously from the actual benefit.

 

IMO, one creates an appropriate ego by putting it on the line and and building it anew when necessary. This should not be a big deal for anyone, although it does take a little practice to get used to doing it. The reward is new knowledge. Multiple moments of 'doh' will inevitably lead to a fabled 'aha'. If you experience a few 'haha's' at your own expense on the way to the 'aha', that makes it even better.

 

Differentiation is the path to ahas and 'new knowledge', and ego has no place there.

[ljyoung 10]

With respect to these methods, I agree that discussion can be valuable if one party is a definitive source (aka transference). Otherwise, the perceived benefit differs enormously from the actual benefit.

 

 

 

Differentiation is the path to ahas and 'new knowledge', and ego has no place there.

 

Science teaches us (and I'm quite sure the same thing can be said of other disciplines as well) that one sould be appropriately sceptical and avoid pedants. Similarly one learns to be aware and beware of knowledge by decree. There is a singular paucity of such things hereabouts. However, I do not share your need for a definitive source because in reality, IMO, there is no such person. An open mind can always learn from another open mind.

 

As for your second comment, I couldn't agree more.

 

A question for Spyder. Are you aware of situations where the trendline-Gaussian correlation falls apart?

lj

Edited July 20, 2009 by ljyoung
word change

[ehorn 10]

The most definitive source of correct and accurate information is the market itself. Everyday it provides us feedback. It shows a trader everything he/she needs and it shows us where our strengths and/or weaknesses lie. It tells us where we are solid and where there is room for refinement. Spydertrader cannot make the journey for anyone of us but only act as a guide. In his great efforts, he has provided us all a record of the things required to learn to listen to the market and to learn from the market. I think many of us have come to a place where we feel the need to be graded on our homework. The market gives out grades everyday and it gives out homework as well.

 

Just my 2c

Edited July 20, 2009 by ehorn
spelling

[ljyoung 10]

The most definitive source of correct and accurate information is the market itself. Everyday it provides us feedback. It shows a trader everything he/she needs and it shows us where our strengths and/or weaknesses lie. It tells us where we are solid and where there is room for refinement. Spydertrader cannot make the journey for anyone of us but only act as a guide. In his great efforts, he has provided us all a record of the things required to learn to listen to the market and to learn from the market. I think many of us have come to a place where we feel the need to be graded on our homework. The market gives out grades everyday and it gives out homework as well.

 

Just my 2c

 

Well put ehorn. If I might add it also hands out detention when we're bad and think that we know more than we really do .

 

lj

[Spydertrader 10]

Are you aware of situations where the trendline-Gaussian correlation falls apart?

lj

 

No such circumstance exists - ever.

 

- Spydertrader

[gucci 10]

It appears you continue to miss my point.

 

 

Such may be the case.

 

 

Tapes build Traverses and Traverses Build Channels.

 

Again, whatever something "looks like" in the Price pane does not matter in the slightest. The Gaussians always tell you what the market has created.

 

HTH.

 

- Spydertrader

 

This is exactly the reason I asked to omit the Gaussians annotations but leave the ones in the Price pane on those charts. For me personally that would allow to gauge the importance of various building blocks of Gaussians.

Edited July 21, 2009 by gucci
spelling

[Neoxx 10]

The most definitive source of correct and accurate information is the market itself. Everyday it provides us feedback. It shows a trader everything he/she needs and it shows us where our strengths and/or weaknesses lie. It tells us where we are solid and where there is room for refinement. Spydertrader cannot make the journey for anyone of us but only act as a guide. In his great efforts, he has provided us all a record of the things required to learn to listen to the market and to learn from the market. I think many of us have come to a place where we feel the need to be graded on our homework. The market gives out grades everyday and it gives out homework as well.

 

Just my 2c

 

Exactly.

 

Discussion is a poor substitute for differentiation, where the answers come from the market itself.

 

However, if one chooses to advance their knowledge via discussion, IMHO it should be with someone who has the answers and can act as a guide, rather than someone still searching for the answers themselves.

[gucci 10]

Spyder,

 

would the information provided by the Gaussians to the right of the marked ftt in the attached chart suffice, in order to unambiguously classify "this something" as a traverse. If so, would it be dominant or non-dominant one?

[Spydertrader 10]

would the information provided by the Gaussians to the right of the marked ftt in the attached chart suffice, in order to unambiguously classify "this something" as a traverse. If so, would it be dominant or non-dominant one?

 

Your Gaussians have no variation in line thickness, nor do they show variation in color (red or black), nor have you chosen to show Price annotation in this specific example. I'm gonna' go out on a limb here and suggest, perhaps, creating thoroughly annotated charts provides more information to the trader than you currently have the ability to see.

 

So how about you give creating a thoroughly annotated chart a try. Even if you get everything incorrect at first, you'll (at least) start to learn the process (finally).

 

- Spydertrader

[gucci 10]

Your Gaussians have no variation in line thickness, nor do they show variation in color (red or black), nor have you chosen to show Price annotation in this specific example. I'm gonna' go out on a limb here and suggest, perhaps, creating thoroughly annotated charts provides more information to the trader than you currently have the ability to see.

 

So how about you give creating a thoroughly annotated chart a try. Even if you get everything incorrect at first, you'll (at least) start to learn the process (finally).

 

- Spydertrader

 

Spyder,

 

I find myself in a position, where anything I say about your last two answers can and will be interpreted as an attempt to debate something. The reasonable decision in such a situation is to abstain from it. So I will comply.

 

Your suggestion to embark upon differentiation process is without question a conducive one. As far as I understand the nature of the above mentioned process and am able to educe its appropriate modus operandi, I would associate it with falsifying the theories in critical rationality. With your knowledgeable answers I hoped to falsify my theories about some relationships between price and volume and move on. This would be really helpful, I thought.

 

By the way, my last question didn’t have anything to do with annotations at all (Gaussians are Gaussians, do they have anything to do with annotations?). But I guess that was my fault, because I asked it.

 

Thank you for your time.

[Spydertrader 10]

As far as I understand the nature of the above mentioned process and am able to educe its appropriate modus operandi, I would associate it with falsifying the theories in critical rationality.

 

Whether through falsification or validation, the entire process begins with starting at a baseline of understanding. Whatever information comprises said baseline matters little, but the baseline of understanding must exist in order to begin. Currently, you have provided an annotation baseline which fails to provide you any worthwhile information

 

With your knowledgeable answers I hoped to falsify my theories about some relationships between price and volume and move on. This would be really helpful, I thought.

 

The whole purpose of this thread involves learning a process one which shows how (and where) to differentiate that which people believe from that which actually exists.

 

However, you appear to favor a different process. You (along with a few others) seem to feel having me provide answers to your questions represents the best and most efficient path toward success. I've suggested (instead) a path whereby the individual learns to obtain their answers from the one location which is always right - the market.

 

By the way, my last question didn’t have anything to do with annotations at all (Gaussians are Gaussians, do they have anything to do with annotations?). But I guess that was my fault, because I asked it.

 

Not all that long ago, you simply refused to place Volume on your charts - opting instead to learn about the Price / Volume Relationship by using Volatility as a proxy. To be clear, everyone should feel entitled to learn about the Price / Volume Relationship in any manner they feel best suits their needs.

 

Understand, I really do not care whether or not you follow the advice provided in this thread (or others), nor do I hold any ill will toward you in any way shape or form. However, if you can't see something (which exists right in front of your face), and several people advise you how you can go about the process of learning to see it, perhaps something of value can be gleaned from following directions.

 

HTH.

 

- Spydertrader

[dkm 10]

So, “our gaussians must match our trend lines” and “our gaussians always tell us what has been created”. Our trend lines come from correctly drawn tapes, traverses and channels so clearly, the trendlines have to be drawn first in order that the gaussians can be drawn to match the trendlines. For the gaussians to tell us what has been created, am I correct in assuming that we use the volume sequences b2b2r2b or r2r2b2r?

[Spydertrader 10]

For the gaussians to tell us what has been created, am I correct in assuming that we use the volume sequences b2b2r2b or r2r2b2r?

 

Always and without exception.

 

- Spydertrader

[gucci 10]

Spyder,

 

the first passage in your response doesn't have anything to do with the quote.

 

In your second two passages, the first one doesn't have anything to do with the quote and the second one tries to obnubilate a reprehension.

 

The last two paragraphs simply contain some tinglers.

 

Thank you for your time, Spyder.

 

PS: Guys, I apologies for this "rude" answer, I won't bother you anymore with my posts.

 

I wish all of you a lot of success.

Edited July 21, 2009 by gucci
grammar

[Spydertrader 10]

Thank you for your time, Spyder.

 

I wish you tremendous success in your future endeavors.

 

- Spydertrader

[TIKITRADER 10]

This is an old chart from Spyder I had added some of my annotated thoughts from quit a while ago.

 

Is this one part in the correct direction in volume / price relation ?

[Spydertrader 10]

Is this one part in the correct direction in volume / price relation ?

 

A danger exists with using older charts to find one's way. First, depending on the discussion (at the specific point in time of the chart's creation) annotation convention may differ in an effort to highlight the specific area under discussion. In other words, a discussion with respect to a 'faster fractal traverse' would see those areas highlighted in the annotated chart, and possibly, very few (if any 'actual' tapes), whereas currently, this discussion only considers three fractals - tape, traverse and channel (or if you prefer, skinny, medium and thick; L1, L2 & L3). Second (as is the case with this specific chart), the previous annotation convention may not apply to the current discussion at all. For example, note the Gaussians on the chart you attached. They only show two levels. Moving forward, we want to focus on 'seeing' all three levels of Gaussian activity and only three levels.

 

Again, I don't want to discourage the use of older charts. I just want to caustion everyone to view these artifacts as intended at the time of their creation, and not, from the vantage point of an improved knowledge plateau.

 

HTH.

 

- Spydertrader

[TIKITRADER 10]

Starting out at the most basic level, is this correct for the AM today on taping ? Volume gaussians are at the correct tape weight.

[dkm 10]

This is an attempt to differentiate tapes and traverses.

 

A tape begins as a 2 or 3 bar element with a LTL and a RTL. The tape RTL might steepen due to a close outside the tape LTL on increasing volume. A tape RTL may also require fanning to become shallower. In all cases a tape will continue as each new bar is formed until price closes outside the tape RTL.

 

A traverse must have a minimum of 3 tapes, forming p1 to p2, p2 to p3, and p3 to p1 of the next traverse. A traverse will include a full gaussian cycle of b2b2r2b or r2r2b2r. Any trend containing less than a full gaussian cycle cannot be a traverse and therefore must be a tape. The gaussians must match the trendlines. Traverses overlap at point 1 only.

 

Gaussian annotations on attached chart for traverses only.

[TIKITRADER 10]

Good post Dkm.

 

ok so lets start to differentiate a tape from a traverse.

There is a certain construct that will build a tape.

There is also a construct for the traverse.

 

These two can be compared against each other to differentiate.

 

We know a traverse is built of dominant- non dominant- dominant compartments to complete the traverse. Volume sequences will complete this.

Then each individual compartment that builds the traverse needs to be examined to see their construct.

We can look at each individual compartment of the traverse to see if they are built of a dominant- non dominant - dominant with volume cycles also completing this.

 

Tapes should be building each of the 3 compartments that build a traverse.

Tapes can be compared to a traverse to see if they require the same construct.

 

A traverse must have dom - non dom - dom in its build. Volume in a completed traverse will be increasing - decreasing - increasing .Does each compartment of the traverse require the same ?

 

Tapes build the compartments that build the traverse so

must a tape be built of the same ? increasing volume, decreasing volume, increasing volume ?

What exactly is the construct of a tape ?

 

 

What should be seen in the tape when it comes to volume sequences if any ?

 

This is posted to possibly bring about discussions of differentiation.

[romanus 10]

Starting out at the most basic level, is this correct for the AM today on taping ? Volume gaussians are at the correct tape weight.

IMO annotating the first two down tapes the way you did would result in a tape sequence (dom, non-dom and dom) creating a completed traverse sequence on tapes ( and consequently on medium thickness gaussians as well) at 10:05 OB. The first tape is drawn to decreasing volume bar. As such it has all three Points (1,2 & 3) on the same bar - Bar 1. Bar is an increasing volume bar which makes lower low. As such we must fan to accommodate it inside the original tape trendlines ( the way dkm did on his chart that he posted). The fanned out (decelerated tape - red on dkm's chart) has it's Point 3 on Bar 3. Drawing the tape from Bar 2 to Bar 3 the way you did would result in tape having it's Point 3 on Bar 3 and consequently two trends of different slope sharing the same Point 3. I don't believe this is a possibility.

[Ezzy 10]

 

 

Tapes build the compartments that build the traverse so

must a tape be built of the same ? increasing volume, decreasing volume, increasing volume ?

What exactly is the construct of a tape ?

 

What should be seen in the tape when it comes to volume sequences if any ?

 

This is posted to possibly bring about discussions of differentiation.

 

Hey Tiki,

 

Nice to have you back with us. Your questions are why I had posted a page ago regarding the above pics, and getting clarification for points 1,2,3 on the 2 bar tape. Assuming the smallest possible traverse you would need at least 6 bars (possibly 5?) to complete a traverse: 2 bar tape up, 2 bar tape down or lateral, 2 bar tape up. For a 2 bar tape the volume acceleration-deceleration-acceleration might be difficult to see over just two 5 minute bars. This is assuming that we need to apply the traverse and channel rules to tapes.

[Ezzy 10]

This is an attempt to differentiate tapes and traverses.

Nice work. I might want to add an accelerated pt3 at 12:40 or so for the traverse but that may be a bit OT for the time being. Looks good to me.