The Price / Volume Relationship

[Ezzy 10]

A little more food for thought. If you had a valid 2 bar tape, (rare) how could you have four volume bars go dec blk -> inc blk -> dec red -> inc blk? b2b2r2b. So the cycle happens within those 2 bars.

[rs5 10]

Wednesday 28 October 2009

[Breakeven 10]

I don't see where dec red tape goes to a dec black tape. Could you doctor the pic?

 

Thanks very much for the replys!

 

With the dec red to dec black I was trying to describe how I saw the bars moving inside the single down tape. In effect trying to see the R2R2B2R within the Tape, but I see now what you are saying about the sequence not always being visible on the 5min.

 

A little more food for thought. If you had a valid 2 bar tape, (rare) how could you have four volume bars go dec blk -> inc blk -> dec red -> inc blk? b2b2r2b. So the cycle happens within those 2 bars.

 

This is a perfect insight to my question, and this example opened my eyes to what you are saying.

 

http://www.traderslaboratory.com/forums/34/price-volume-relationship-6320-3.html#post71051

 

I am really glad you referenced the "Clean Page 1" while explaning this because I have been looking there while trying to wrap my head around Tape volume fractals. Which leads to another question I have regarding the wording on clean page 1.

 

Part 3 refers to the Gaussian part 1 (rising) and part 2 (falling). Does the part 1 and part 2 combined refer to the R2R of the Tape, or would part 1 be the R2R and part 2 be 2B?

 

Thanks again for the assistance.

[romanus 10]

As much as I hate to alter my view yet again, this whole down thing is beginning to feel like medium R2R. Based on that subjective measure coupled with the possibility that p2 of monday's down traverse might have occured during the first 15 minutes of the day, the possibility that yesterday was an up traverse beginning to look very promising,

[romanus 10]

I am having a problem reconciling two of the images that Spyder posted near the beginning of the thread. One image shows a Traverse, with Tapes and Channel labeled. The second image is the volume pane fractals. I have combined the images for attachment.

 

For the life of me, I can not see the Tape volume fractals on this Traverse.

Me neither. Consider the possibility that in THIS particular case they don't exist.

 

 

 

...From the volume fractals image I see that each segment of a Traverse should have a full B2B2R2B or R2R2B2R representing the Tapes.

Consider the possibility that your interpretation of the image is different from the meaning that this image was intended to convey and that the qualifiers highlighted in red represent something you have assumed. My assumption is different and if you replace the 'each' qualifier with 'some', and the 'should' qualifier with 'might', you might arrive at the alternative point of view.

 

 

 

So, with my understanding of the volume fractals this is what I get on the attached Traverse. First Tape is Dec Red, Dec Black, Inc Red, which does not fit R2R2B2R. The other two Tapes are similar in that they seem to be missing one or more parts of the volume fractal sequence.

One school of thought is that the gaussians match the trendlines and not the actual volume bars.

[cnms2 10]

... Part 3 refers to the Gaussian part 1 (rising) and part 2 (falling). Does the part 1 and part 2 combined refer to the R2R of the Tape, or would part 1 be the R2R and part 2 be 2B?

 

Thanks again for the assistance.

My interpretation is that a gaussian is a volume formation that has an increasing slope followed by a falling slope. We can see gausians formed of volume bars, of groups of bars, of groups of groups of bars, ... x2X2y2X is another type of volume formation. If x, y represent decreasing volume, and X, Y increasing volume, then the gaussian is X2y, or dominant followed by non-dominant. So we have two types of gaussians R2b in down trends and B2r in up trends.

[cnms2 10]

... One school of thought is that the gaussians match the trendlines and not the actual volume bars.

By this I understand that when trendlines and gaussians are correctly drawn they should make sense. This refers both to the volume bar trends and to their pace.

[Breakeven 10]

After reviewing the charts I have annotated recently, I now see that all my annotations are one fractal "slow". By trying to draw a complete volume cycle for every Tape using 5min end of bar data I have been getting Tapes where a Traverse is actually present. In effect, my "sub-fractals" are actually Tapes and my Tapes are actually Traverses ect.

 

I just need to get it through my head that a Traverse is the fastest fractal that will always have a full visible gaussian cycle.

 

The bad news is that I have drawn a crap load of line that I have "labeled" wrong.

 

The good news is that since this is all fractal I just need to convince my brain to label these same lines one fractal faster. That should put all my goats in a row For this issue at least!

[Breakeven 10]

Consider the possibility that your interpretation of the image is different from the meaning that this image was intended to convey and that the qualifiers highlighted in red represent something you have assumed. My assumption is different and if you replace the 'each' qualifier with 'some', and the 'should' qualifier with 'might', you might arrive at the alternative point of view.

 

I think this is exactly where I went wrong. In the volume fractal diagram I took the "skinny" lines on one leg of the "medium" to mean that they would be visible for every leg. I now believe those lines are drawn on only one leg to indicate they are only visible on some legs.

 

Thanks for the help!

[Breakeven 10]

My interpretation is that a gaussian is a volume formation that has an increasing slope followed by a falling slope. We can see gausians formed of volume bars, of groups of bars, of groups of groups of bars, ... x2X2y2X is another type of volume formation. If x, y represent decreasing volume, and X, Y increasing volume, then the gaussian is X2y, or dominant followed by non-dominant. So we have two types of gaussians R2b in down trends and B2r in up trends.

 

 

I think I understand what you are saying, but it is late enough tonight that my brain isn't registering correctly. Give me some time on this one and I may pester you with more questions on this subject.

 

Thanks very much!

[Gregor_S 10]

I believe romanus’s chart represents the correct view of the past few days and that my view was wrong. I need to find out why I do not monitor correctly. I guess the first thing is that I do not pay enough attention to volume and that my concept of what makes a fractal is not correct.

 

I have changed some things and this is my view for yesterday, done after market close. The next step in my sequence is pt.2 on a traverse level.

[romanus 10]

I believe romanus’s chart represents the correct view of the past few days and that my view was wrong. I need to find out why I do not monitor correctly. I guess the first thing is that I do not pay enough attention to volume and that my concept of what makes a fractal is not correct.

 

I have changed some things and this is my view for yesterday, done after market close. The next step in my sequence is pt.2 on a traverse level.

If you attempt to hallucinate things in the same fashion as I do - be prepared for some big disappointments. As of now, what was expected to be a skinny p2 to p3 of the traverse, has broken the original tape trendline and started the climb towards the point two of the up traverse - which means the 1255 yesterday was point 2 of the down traverse which is extremely troubling since it is inside the lateral that doesn't look any different from any other lateral. The only thing that seems to hold true universally for all contexts - is that nothing is what it seems.

[Gregor_S 10]

I would not go so far as to say big disappointment, more like realizations of the truth

 

I find it amusing to see that I actually marked the 12:50-13:45 move on my volume pane yesterday aftermarket. But I dismissed it as a lower fractal move during RvR because of the high red volume later and the fact that it had such a strange position inside a big lateral.

 

It now looks to me like I missed the correct annotations and switched fractals – again. Ah, back to work.

[FJK 10]

My chart from the last two days. Pretty standard.

 

My traverse point 2 today is the only possible solution. Ask yourself why it can't be the 1025, 1115 or 1135 bar. (and yes, you can apply the correct answer to all point 1 --> 2 movements)

[FJK 10]

I believe romanus’s chart represents the correct view of the past few days and that my view was wrong. I need to find out why I do not monitor correctly. I guess the first thing is that I do not pay enough attention to volume and that my concept of what makes a fractal is not correct.

 

I have changed some things and this is my view for yesterday, done after market close. The next step in my sequence is pt.2 on a traverse level.

 

A word of advice, don't look at other peoples chart in this thread (especially not mine ) to establish what is right and wrong. The market tells you. Every single day. If you look at the channel fractal for the last couple of days, you should come to a clear conclusion about your annotations are correct or not.

 

When the market tells you that - perhaps - you are missing something. Ask yourself why. Why is the key. The key to applying it to your own trading - in realtime. For me, it is impossible to get to 'why' by looking at other peoples charts. YMMV of cause :missy:

 

Lastly, why have you chosen not to annotate all three fractals as advised in the beginning of this thread?

[rs5 10]

Thursday 29 October 2009

[Gregor_S 10]

@FJK

I know you are correct on both accounts.

[ehorn 10]

My view of the "bigger" picture...

[rightbyleft 10]

hello fellow traders,

 

there are some volume gaussians examples that spydertrader had posted from 2007

on another forum. it does not show strict black2black2red2black, for example,

sometimes its black2black2red2red. is this a shortcut or out of date? has anyone

ever found an exception to bb2r2b trend?

 

also for ninjatrader, how do you get the up arrow to plot on the volume window?

is it done by indicator or manually?

 

thanks.

Edited October 30, 2009 by rightbyleft
another question

[Tams 20]

hello fellow traders,

 

there are some volume gaussians examples that spydertrader had posted from 2007

on another forum. it does not show strict black2black2red2black, for example,

sometimes its black2black2red2red. is this a shortcut or out of date? has anyone

ever found an exception to bb2r2b trend?

 

thanks.

 

 

this has been explained, I think about a month ago.

if you have been following the progress, I am sure you have ran into it.

[padrotshik 10]

hello fellow traders,

 

there are some volume gaussians examples that spydertrader had posted from 2007

on another forum. it does not show strict black2black2red2black, for example,

sometimes its black2black2red2red. is this a shortcut or out of date? has anyone

ever found an exception to bb2r2b trend?

 

also for ninjatrader, how do you get the up arrow to plot on the volume window?

is it done by indicator or manually?

 

thanks.

Referring to your second question;

it is done by indicator pp_jhmvolume

[rs5 10]

Friday 30 October 2009

[TIKITRADER 10]

Monthly ES Chart for the close of October 2009

[FerdinandAlx 10]

Hello,

 

I'm sure most of you will remember me from Spyder's journal over at Elite Trader. Spyder PM'ed me a while ago to invite me to partake in the discussion here at Trader's Laboratory.

 

I'm wondering if you guys keep in touch during market hours on Skype or a in chatroom. It'd be nice to have some conversation with other traders who use the same price/volume method in their trading.

 

Ferdinand

[cnms2 10]

Friday 30 October 2009

On trending days, sometimes it's harder to see the three leg sequences on each of the three monitored fractals, but they're still there.