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The Lateral Drill laterals all have a higher volume peak for the 1st bar that forms the lateral (or in 1 case the bar before the 1st bar of the lateral which is the same color) than the previous volume peak of the opposite direction price movement.

 

In 1/13/2010 bar 79 this is less apparent but that is because of the end of day effect.

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To inject some life into the lateral formation drill discussion...

 

My hypothesis is that the laterals in questions have two characteristics that separate them from other laterals:

 

1) they begin with a SYM pennant

2) they all form as a R2R or B2B completes (aka pt2) for some fractal level

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Thursday 21 January 2010

 

rs5 - IMO a declining volume long channel started at 11:45 and ended at 14:35... the rest of the day is R2R on the channel fractal. (channel = your medium gaussian lines)

 

...at least that's how I see it.

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rs5 - IMO a declining volume long channel started at 11:45 and ended at 14:35... the rest of the day is R2R on the channel fractal. (channel = your medium gaussian lines)

 

Thank you for your input. Do you mean that you fanned the RTL (small container) from 11:45 est (p1) to 12:55 est (p3)? Or does your 2B (medium container) have p1 at 11:45 rather than at 1:05 est (shown in chart)?

Edited by rs5

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Here is a closer look at the daily chart for ES.

Not a great chart but you get the idea.

It is from October until now. I have also re-attached the Monthy ES that I posted the other day for ease in comparing the charts.

 

Interesting how the volume is dropping on this up leg on the monthly. The daily looks the same way. Hmmm.

 

 

you do think loud.... ..... .....

 

 

;-)

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Thanks for sharing this. I know several people wanted a more in-depth description of what you do. Perhaps you might be able to show some real-time analysis of these concepts this coming week? As you know full well, annotating a chart in hindsight is very different from being able to do the same thing real time (which is very different from being able to act on observations).

 

Agree with you. It is where most beginners make mistakes - i think in knowing the exceptions to the rules.

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See attached.

 

What makes the two highlighted areas different?

 

The 'SYM Lateral 1 - Dom' conforms to the examples in The Lateral Formation Drill (and follow up). 'SYM lateral 2 - Non-Dom' does not conform to the examples in The Lateral Formation Drill (and follow up).

 

Note the difference.

 

- Spydertrader

notsame.jpg.b8cadbe1f7a0191b6cd80e2cd4efb49b.jpg

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I can see how you can group these into those that start with a Sym, and then test the high or low of the 1st bar (without penetrating it), before penetrating the lateral boundary on a later bar.

 

However, from post #1171, I am confused a bit here. It looks like the bar 55 and bar 79 laterals fit this same pattern, but the 67 lateral does not (it starts with a Sym, but there is no bar that tests the lateral before it is penetrated). Just wanted to confirm that neither of those 3 laterals fit into the same set of laterals from the Lateral Drill.

 

I've attached the chart under discussion from #1171 for reference.

example1.gif.ff1b16ba4f55abdf4796e326801d7bbc.gif

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I realize that my question is somewhat off topic, but I am posting in the hope that somebody could point me in the right direction, either here in the thread or by PM, if they wish to remain anonymous. One of the examples of the problem that I am unable to resolve in the present state of my observational skills and sensory acuity is represented in the attached chart: by 11:30 on 1/22 it appears that the container is formed that moved the price from Point 1 to Point 2 of the Traverse. This hypothesis seems to be confirmed by what was developed by the end of the day. The subsequent short tape ending at 12:15 on 1/22 appears to have moved the Price to Point 3 of the Traverse and 12:15 to 12:40 long tape seem to have finished the construction of the Traverse.

 

I have been trying to locate the solution that would indicate that annotating in real time as shown in the attached would be a mistake and that the 11:35 to 12:15 tape COULD IN NO WAY represent the r2r (p1 to p2) of the container that moves the price from Point 2 to Point 3 of the Traverse and that the 12:20 to 12:40 long tape COULD IN NO WAY represent the retrace in the short container that moves the price from Point 2 to Point 3 of the Traverse.

 

In other words, how can one KNOW in real time that 1135-1215 and 1220-1240 tapes represent medium \R and medium /B as opposed to skinny r2r and skinny 2b of the container that one may think is moving the Price from Point 2 to Point 3 of the Traverse.

 

Thank you to whoever would be kind enough to point me in the right direction.

1_22_2010.thumb.png.22272d45812e536e470b6f278830fa98.png

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See attached.

 

What makes the two highlighted areas different?

 

The 'SYM Lateral 1 - Dom' conforms to the examples in The Lateral Formation Drill (and follow up). 'SYM lateral 2 - Non-Dom' does not conform to the examples in The Lateral Formation Drill (and follow up).

 

Note the difference.

 

- Spydertrader

 

Hi Spydertrader and All JHM Students,

 

A) Observation on SYM Lateral starts on Bar 43---

 

1) SYM forms on Bar 44

2) Bar 46 is the first bar which tests the bottom boundary of the Lateral

3) This is a legitimate SYM Lateral comparing to the Lateral Drill pattern.

 

B) Observation on [sYM] Lateral starts on Bar 57---

 

a) Ignoring the rule that an IBGS with Increasing Volume terminates a Lateral:

1) SYM forms on Bar 58

2) Bar 62 is the bar which tests the bottom boundary of the Lateral; yet, Bar 61

penetrated (FBO) the bottom boundary of the Lateral before Bar 62 .

3) This is not a legitimate SYM Lateral comparing to the Lateral Drill pattern.

 

b) Apply the rule that an IBGS with Increasing Volume terminates a Lateral:

1) SYM forms on Bar 58

2) Bar 61 penetrated (FBO) the bottom boundary of the Lateral and ends the Lateral.

3) There is no bar testing the bottom boundary of the Lateral before Bar 61.

4) This is not a legitimate SYM Lateral comparing to the Lateral Drill pattern.

 

All comments are welcome and appreciated! TIA

5aa70fb37195a_SYMLateralDifferentiation.gif.86d9749526e92da5f3efe8c78f27e8a3.gif

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I am confused a bit here. It looks like the bar 55 and bar 79 laterals fit this same pattern, but the 67 lateral does not (it starts with a Sym, but there is no bar that tests the lateral before it is penetrated). Just wanted to confirm that neither of those 3 laterals fit into the same set of laterals from the Lateral Drill.

 

67 does not. The other ones do. I posted the corrected chart here: http://www.traderslaboratory.com/forums/34/price-volume-relationship-6320-30.html#post86620

 

It also gives you a bonus lateral, one on the next day, that is the same. And one later that day that isn't. These two were mention in the post before the chart and so were included. The Green circles are all conforming laterals.

Edited by Ezzy

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The first lateral starts with a dominant bar, while the second starts with a non-dominant bar, however, this bar is also an outside bar.

 

Another difference is that the first lateral moves in the non dominant direction after the second bar, while the other lateral moves in the dominant direction after the second bar.

 

Also the lateral boundary test is not at the same side.

 

--

innersky

 

See attached.

 

What makes the two highlighted areas different?

 

The 'SYM Lateral 1 - Dom' conforms to the examples in The Lateral Formation Drill (and follow up). 'SYM lateral 2 - Non-Dom' does not conform to the examples in The Lateral Formation Drill (and follow up).

 

Note the difference.

 

- Spydertrader

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In other words, how can one KNOW in real time that 1135-1215 and 1220-1240 tapes represent medium \R and medium /B as opposed to skinny r2r and skinny 2b of the container that one may think is moving the Price from Point 2 to Point 3 of the Traverse.

 

You cannot see what the market has provided because of a bias caused by vocabulary. For now, try not to think in terms of 'tapes' building 'traverses' and 'traverses' building 'channels.' Instead, think in terms of 'fractals' (pipes, tubes, containers or pathways [whatever works best for you]) without names where one fractal builds another moving up to slower and slower fractals, but also, where one fractal is built by something faster moving downward.

 

Remove the overall bias by deleting your Gaussians, and look for an alternative way to annotate the area from 10:20 AM to 11:30 AM. For it is here where the real annotation error resides.

 

Once you can see why the 10:20 AM to 11:30 AM area cannot result in your current annotations, you'll have the answer to your question.

 

HTH.

 

- Spydertrader

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Ignoring the rule that an IBGS with Increasing Volume terminates a Lateral

 

Before one can concern themselves with how something ends, one must (for certain) know how that something begins. Adding uneccesary paramters provides nothing but uneeded complexity. As such, one need not consider (at this point) how any sort of Lateral examples end.

 

Remain focused on how any example begins in order to see whether or not any lateral you see conforms to the examples provided by The Lateral Formation Drill (and follow up). After you know you have an appropriate example, then you can determine what (if any) subtle differences (in the formation of the object itself) differ in such a way where one has the ability to clearly 'see' what information the market has provided. Finally, by combining this information with context and order of events one can know exactly to annotate a different thing on the chart's Volume Pane.

 

HTH.

 

- Spydertrader

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The first lateral starts with a dominant bar, while the second starts with a non-dominant bar, .

 

--

innersky

 

Yes I see this and agree. Laterals form from bar 1 of the lateral, as a dominant bar, or a non dominant bar, and that begins creating the lateral. Respective of the fractal they are on.

 

While a series of laterals within one fractal exist as dom, non dom, dom ( ex: traverse ), on another fractal they may each be dominant( ex: tape level ).

( which may help eliminate fractal jumping and staying on course)

 

jbarnby had begun to differentiate and posted this in the past

 

http://www.traderslaboratory.com/forums/34/price-volume-relationship-6320-27.html#post72076

 

and a reply to his work posted here

 

http://www.traderslaboratory.com/forums/34/price-volume-relationship-6320-27.html#post72091

Edited by TIKITRADER
added comment

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Also the lateral boundary test is not at the same side.

 

The Second Lateral (the 'non-dom' labled example) does not conform to the examples in The Lateral Formation Drill (and follow up). Understand why it does not.

 

- Spydertrader

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This is monthly ES with gaps closed. Looks to me like we probably made a 2 point of the current up tape. Still working on getting differentiated with lateral formations. Thanks for the discussion.

 

MKTr

5aa70fb3a62ac_MK20100124MnthlyES.thumb.png.a64b48c67f185658a3aa788e00a53912.png

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