The Price / Volume Relationship

[Tams 20]

  dkm said:

Unfortunately that post did not help me in any way because I have yet to understand what it is you are alluding to with respect to differentiating laterals. It now seems that the boundary of a lateral is defined by a bar within the lateral and something is implied by whether or not it has incr or decr volume.

This could take forever..............

 

 

if you start taking note of the permutations,

it is never too late...

[Spydertrader 10]

  FilterTip said:

how can they both be correct?

 

Please review the post to which you refer - especially the quoted portions of the previous posters. You should note, one individual's (Ezzy) quote refers to a sequence of events. I indicated a correct set of annotations with a response to direction only.The second individual (TIKI) referred to how an Outside Bar formed (Price making a higher high [over the previous bar] prior to closing below the bar's open). I indicated he had posted a correct analysis with respect to the Outside bar only.

 

- Spydertrader

[FilterTip 10]

  sambrown said:

FilterTip and dmk,

 

Please compare Tiki's yesterday's lateral post with today's 11:10am lateral. Today lateral boundary was created by 11:20 and 11:25 bars. Did you see the same in Tiki's post?

The differences between the two are the way the first bar was formed and the direction the price exited. I hope this help.

 

Thx for the reply.

Yes I "see the same on TIKI's post".

 

I've attached the two charts your mention for reference.

(so we're all on the same page)

 

My understanding of what you are saying is :

 

1. Your chart shows a lateral, the first bar of which is on increasing volume.

2. TIKI's chart shows a lateral (the second red shaded lateral), the first bar of which is on decreasing volume.

3. Both are in the Dominant direction (on the basis that they both occur post b2b).

4. Both have bars within the lateral that touch (create, with") the "upper" boundary of the lateral.

5. Your lateral exits in the dominant direction (up)

6. TIKI's exits in the opposite direction (down)

 

Can we conclude there for the following differentiations:

1. A dominant lateral who's first bar is on decreasing volume that "creates, with" the upper boundary will exit in the opposite direction from which it entered?

 

2. A dominant lateral who's first bar is on increasing volume that "creates, with" the upper boundary will exit in the same direction from which it entered?

 

The above is specific to these "things" that have happened.

Thus they are dependent on

a. Lateral being dominant or non-dominant.

b. First bar of lateral having increasing or decreasing volume.

c. Whether it is the upper or lower boundary that has been "created, with".

 

 

I shall obviously have to look through 27 years worth of charts to "compare and contrast"

so any thoughts on the above and any assistance on "comparing and contrasting" are appreciated.

 

??

 

Many thx

Edited January 26, 2010 by FilterTip

[Spydertrader 10]

  romanus said:

I believe you are absolutely correct. The quoted definitions presuppose that an observer is able to define what "fractal" IS in some way that is consistent across all contexts.

 

I haven't presupposed anything.

 

Of the three 'things' which dictate what annotations belong on a chart (context, order of events and [differentiation of the actual] objects), I simply started with the easiest of the three.

 

In addition, knowing how Price must exit a specific lateral type provides opportunity for people to earn real money every time they see a certain 'thing' appear on a chart.

 

Lastly, Within the last two days, I've provided several examples of how one applies the scientific method for moving forward in an effort to show people what they must do in order to untangle that which they find confusing.

 

Unfortunately, very few have seen as beneficial that which has been posted over the last 2 days.

 

- Spydertrader

[romanus 10]

  Spydertrader said:

I haven't presupposed anything.

 

You are correct, the presupposition was created by me in the process of attempting to understand the intended meaning.

 

 

  Spydertrader said:

Of the three 'things' which dictate what annotations belong on a chart (context, order of events and [differentiation of the actual] objects), I simply started with the easiest of the three.

 

I don't disagree with the approach. Personally, I keep running into the same problem, the missed component of monitoring, that prevents me from knowing what comes next, - and my attempted humor in the quoted post was meant as " a reference only" to my personal state of being "stuck" in the particular place of my inquiry.

 

 

  Spydertrader said:

Unfortunately, very few have seen as beneficial that which has been posted over the last 2 days.

 

I have been fortunate to be reminded by you on numerous occasions that certain things repeatedly exist on charts irrespective of the observer's ability or inability to notice them. Keep in mind, it took me quite some time to tell the difference between those containers that have overlapping point's two and those that don't.:rofl:

 

So, the group of "very few", that you are referring to, includes at least one more member for sure (+1), that is myself.

 

 

P.S. Trying to define those "things", that one sees, in terms that don't allow for contradiction is a very hard and demanding task. And it may be appreciated by more people than you think.

[sambrown 10]

  Quote

Can we conclude there for the following differentiations:

1. A dominant lateral who's first bar is on decreasing volume that "creates, with" the upper boundary will exit in the opposite direction from which it entered?

 

2. A dominant lateral who's first bar is on increasing volume that "creates, with" the upper boundary will exit in the same direction from which it entered?

 

I have not gotten to a point of making these conclusions yet.

I am following Spyder's advise on analyzing the context and order of events.

[Spydertrader 10]

  FilterTip said:

I shall obviously have to look through 27 years worth of charts to "compare and contrast"

so any thoughts on the above and any assistance on "comparing and contrasting" are appreciated.

 

Step by step, follow these directions ...

 

  Spydertrader said:

Rather than saying, "the market tests the Lateral Boundary created at Bar 1," subsitute the words, "the market creates the Lateral Boundary with Bar 1." Now, run this test across both examples under discussion (as well as other examples from The Lateral Formation Drill (and follow up). Does each example conform do this definition?

 

Run the test on TIKI's chart. One Lateral meets the definition. One does not. (For now - and throughout this discussion for 5 weeks now) we only care about Laterals which meet the definition.

 

  Spydertrader said:

Using the above (re-worded) defintion, everyone should be able to create (in their mind's eye and on paper) three possible examples of a Lateral which conforms to the examples provided in The Lateral Formation Drill (and follow up), but also represent entirely different things from each other.

 

In other words, Three possible ways exist for this one type of Lateral (begins with a Sym pennant, and some bar in the future creates a boundary with Bar 1 of the Sym). What are those three ways? Two of those ways exist within the Lateral Formation Drill itself.

 

  Spydertrader said:

Good. Now, set aside Volume (for just a moment) and determine if all of the examples under discussion form in the exact same (as our reworded definition) way. Those that do not form in such a fashion fall into a different pile.

 

In other words, we have defined something based on price, and we will use (later) Volume to note the differences amongst the various examples of things within this specific pile of Laterals (as defined above). However, before one can move to seeing subtle differences (step two), a trader must first complete step one - locate three ways the object definied above can form - without looking at Volume (yet).

 

- Spydertrader

Edited January 26, 2010 by Spydertrader
fixed quotation formatting

[FilterTip 10]

  Spydertrader said:

Please review the post to which you refer - especially the quoted portions of the previous posters. You should note, one individual's (Ezzy) quote refers to a sequence of events. I indicated a correct set of annotations with a response to direction only.The second individual (TIKI) referred to how an Outside Bar formed (Price making a higher high [over the previous bar] prior to closing below the bar's open). I indicated he had posted a correct analysis with respect to the Outside bar only.

 

- Spydertrader

Thx for the reply.

 

If you're able to correctly reference posts together, well then so should I.

Although I'm reminded of that wonderful quote from the film Blow,

"my ambition has always far exceeded my talent"

 

To clarify (for me) TIKI got a "chicken dinner" because he correctly described the OB.

Not because his gaussians are correct?

 

I do see Ezzy and your posts referencing why there was no increasing black volume following (confirming) P3.

 

And in view of sambrown post 1272,

 

Ezzy's lateral would be one that we knew would exit opposite from the direction from which it entered (entered going up, exit going down)

because it was a dominant lateral, the first bar of the lateral being on decreasing volume,

and having "created with" the upper boundary of the lateral?

 

(Ezzy lateral attached for reference)

 

Spyder. thanks for your continued efforts.

I applaud you.

I want to understand this.

For that end, I will there for need to ask about everything that you have and hopefully will continue to try to explain, that I do not understand, until I do understand.

 

Kind Regards as always.

[FilterTip 10]

  Spydertrader said:

Step by step, follow these directions ...

 

Run the test on TIKI's chart. One Lateral meets the definition. One does not. (For now - and throughout this discussion for 5 weeks now) we only care about Laterals which meet the definition.

 

So TIKI's first lateral (grey shaded) does not conform because the boundaries of the lateral are not "created, with".

TIKI's 2nd lateral (red shaded) does conform because it has bars that "create, with" the boundaries of the lateral.

??

 

 

  Quote

In other words, Three possible ways exist for this one type of Lateral (begins with a Sym pennant, and some bar in the future creates a boundary with Bar 1 of the Sym). What are those three ways? Two of those ways exist within the Lateral Formation Drill itself.

 

"What are those 3 ways"?

 

that the boundaries of a lateral have bars that "create with"

1. the upper boundary.?

[EDIT] 1a. or more correctly, a boundary in the dominant direction (dominant boundary)?

2. the lower boundary?

[EDIT] 2a. a boundary in the non dominant direction (non-dom boundary)?

3. both the upper and lower boundaries?

 

  Quote

In other words, we have defined something based on price, and we will use (later) Volume to note the differences amongst the various examples of things within this specific pile of Laterals (as defined above). However, before one can move to seeing subtle differences (step two), a trader must first complete step one - locate three ways the object definied above can form - without looking at Volume (yet).

 

- Spydertrader

 

Yes understood. I made my post# 1283 prior to seeing this post of yours, so I was still referencing volume in my post# 1283.

 

Thx

Edited January 26, 2010 by FilterTip

[Spydertrader 10]

  FilterTip said:

To clarify (for me) TIKI got a "chicken dinner" because he correctly described the OB. Not because his gaussians are correct?

 

I never looked at the Gaussians supplied by TIKI. As such, I cannot speak to their accuracy. However, my comments about said "Chicken Dinner" did pertain exclusively to the correct analysis of the Outside Bar provided by TIKI.

 

  FilterTip said:

Ezzy's lateral would be one that we knew would exit opposite from the direction from which it entered (entered going up, exit going down)

because it was a dominant lateral, the first bar of the lateral being on decreasing volume,

and having "created with" the upper boundary of the lateral?

 

The Lateral to which you refer did form in the dominant direction (Bar 1 of the Sym), it did form on decreasing Volume (again, bar 1 of the Sym and the black bar which formed an equal high with the Sym Bar 1 ) and it did form by a third bar creating an 'upper boundary' with Bar 1 of the Sym. However, these are not the only things known at the time. With respect to Order of Events you had a completed sequence (across a non-dominant segment of a larger trend). Context also played a role (although not important in this specific example. As a result of these three things, Price had to exit through the lower part of the specific lateral in question.

 

The day's second example (beginning at 12:50) formed in the same fashion (with subtle Volume differences), but the Order of Events was different (again context played next to no role in this specific example as well). As such, the outcome was different.

 

HTH.

 

- Spydertrader

[romanus 10]

  FilterTip said:

 

"What are those 3 ways"?

 

that the boundaries of a lateral have bars that "create with"

1. the upper boundary.?

2. the lower boundary?

3. both the upper and lower boundaries?

 

 

One may find the words "upper" and "lower" slightly misleading. I would opt out for something more directionally neutral, such as "same" or an "opposite" as compared to the direction of the first bar.

 

[edit] P.S. This is obviously redundant since you had the same concern and reposted with edits.

Edited January 26, 2010 by romanus

[Spydertrader 10]

  FilterTip said:

So TIKI's first lateral (grey shaded) does not conform because the boundaries of the lateral are not "created, with".

TIKI's 2nd lateral (red shaded) does conform because it has bars that "create, with" the boundaries of the lateral??

 

Correct. However, try saying it this way ...

 

"TIKI's second example does comply because it has a bar which creates a Lateral boundary with Bar 1 of the Sym."

 

Perhaps, you'll find the above verbage easier to 'see' in your minds eye (and on a chart).

 

  FilterTip said:

"What are those 3 ways"?

 

that the boundaries of a lateral have bars that "create with"

1. the upper boundary.?

[EDIT] 1a. or more correctly, a boundary in the dominant direction (dominant boundary)?

2. the lower boundary?

[EDIT] 2a. a boundary in the non dominant direction (non-dom boundary)?

3. both the upper and lower boundaries?

 

Great. Dominant Boundary, Non-Dominant Boundary and Both Dominant and Non-Dominant Boundaries.

 

Easy as that.

 

- Spydertrader

[Spydertrader 10]

  romanus said:

Romanus' examples

 

I encourage you to remove the arrows from your examples. We have not yet looked at the direction as part of the prcoess of similarities - direction of the Bar , however, may represent an important subtle difference.

 

- Spydertrader

[FilterTip 10]

  Spydertrader said:

I never looked at the Gaussians supplied by TIKI. As such, I cannot speak to their accuracy. However, my comments about said "Chicken Dinner" did pertain exclusively to the correct analysis of the Outside Bar provided by TIKI.

 

 

 

The Lateral to which you refer did form in the dominant direction (Bar 1 of the Sym), it did form on decreasing Volume (again, bar 1 of the Sym and the black bar which formed an equal high with the Sym Bar 1 ) and it did form by a third bar creating an 'upper boundary' with Bar 1 of the Sym. However, these are not the only things known at the time. With respect to Order of Events you had a completed sequence (across a non-dominant segment of a larger trend). Context also played a role (although not important in this specific example. As a result of these three things, Price had to exit through the lower part of the specific lateral in question.

 

The day's second example (beginning at 12:50) formed in the same fashion (with subtle Volume differences), but the Order of Events was different (again context played next to no role in this specific example as well). As such, the outcome was different.

 

HTH.

 

- Spydertrader

 

Thx.

 

I still need clarification from your reply.

You refer to more than 3 reasons why we knew the Ezzy lateral (I wish this lateral would live up to it's name sake) would exit opposite from entry..?

 

1.

  Quote

The Lateral to which you refer did form in the dominant direction.

 

2.

  Quote

it did form on decreasing Volume

 

3.

  Quote

and the black bar which formed an equal high with the Sym Bar 1 )

 

4.

  Quote

and it did form by a third bar creating an 'upper boundary' with Bar 1 of the Sym.

 

5.

  Quote

Order of Events you had a completed sequence (across a non-dominant segment of a larger trend).

.

No with standing that we did not see the sequence complete with increasing black volume after a P3.

 

??

 

Thx

 

EDIT

PS..I've just seen your post # 1287.

I don't want to confuse issues....as if....

should I/we ignore the 5 differences I listed above, in light of your reply in post 1287?

 

thx

Edited January 26, 2010 by FilterTip

[romanus 10]

  Spydertrader said:

I encourage you to remove the arrows from your examples. We have not yet looked at the direction as part of the prcoess of similarities - direction of the Bar , however, may represent an important subtle difference.

 

- Spydertrader

If the Dom and Non-Dom boundaries are defined not based on the direction of the 1st bar of the lateral, but rather on the direction that the market provided dominance, how does one define the market dominance: would b2b/r2r prior to the formation of Bar 1 of the lateral be sufficient, or b2b2r/r2r2b would be necessary as in the lateral posted by Ezzy that you described as: "Bar 1 (9:45) of this specific example closed in the same direction that the market provided dominance (in this specific case - B2B) for this specific fractal. The market did so prior to the formation of Bar 1 of this specific lateral."

 

P.S. I am not being semantically sarcastic here, simply trying to ensure that i am looking at the same things that everybody else is looking at. E.g. when I am looking at the lateral boundaries in the attached, I 'd like to be able to determine which one is Dom and which one is Non-dom. ( I realize that the lateral in the attached is different from what we are discussing, and just using it as an example to illustrate my problems in comprehending the process of defining boundaries as Dom and Non-dom.)

Edited January 26, 2010 by romanus

[FilterTip 10]

  Spydertrader said:

Correct. However, try saying it this way ...

 

"TIKI's second example does comply because it has a bar which creates a Lateral boundary with Bar 1 of the Sym."

 

Perhaps, you'll find the above verbage easier to 'see' in your minds eye (and on a chart).

 

 

 

Great. Dominant Boundary, Non-Dominant Boundary and Both Dominant and Non-Dominant Boundaries.

 

Easy as that.

 

- Spydertrader

 

Thx for the confirmation.

I don't want my post# 1289 to interfere with this.

Posts are arriving on the thread while I'm composing mine so sorry for the cross overs.

 

A further clarification if you would kindly oblige..

 

When you say comply ?

We are complying with the 3 laterals in the lateral drill?

and that these 3 "types" of lateral fit within one of two "plies" ?

 

Just trying to get some order in my brain to this..

 

Thx I will use the verbiage you recommend.

Thx

[Spydertrader 10]

  FilterTip said:

Thx.

 

I still need clarification from your reply.

You refer to more than 3 reasons why we knew the Ezzy lateral (I wish this lateral would live up to it's name sake) would exit opposite from entry..?

 

Review my answer. My response to you should indicate the following ...

 

"While yes you did accurately assess the individual particulars of the area under discussion (decreasing volume, dominant direction, etc), you did not in your post (which listed three reasons for knowing the direction of Lateral exit), provide the additional (hence my use of "more than three [that you provided] reasons") pieces of information (context and order of events) one should know prior to reaching a conclusion about this specific event. In addition, you have not yet completed the process of understanding the simiarities of this specific type of lateral, nor have you fully reviewed the various subtle differences which would allow you to accurately see all the various information provided by the object itself. As I result, I recommend avoiding reaching any coclusions which take you outside the current area of discussion."

 

[end translation]

 

Step by step means finish one step before moving to another step.

 

- Spydertrader

[Spydertrader 10]

  romanus said:

If the Dom and Non-Dom boundaries are defined not based on the direction of the 1st bar of the lateral

 

I did not say this.

 

You are one step beyond where you need to be at this particular point in time. Unless and until one finishes the similarities step, one cannot move to the subtle differences step. You have yet to indicate you have fully grasped step one (although it appears you are almost there).

 

As an analogy, when you reviewed the "Seven Cases" post (about how to draw tapes using adjacent bars), did you see direction on those bars? Or, were all those bars without opens and closes?

 

- Spydertrader

[Spydertrader 10]

Seven Examples (Final Step in Similarities Section).

 

See attached.

 

Which Laterals listed comply (meets with the test provided) with those examples which exist in The Lateral Formation Drill? Why or Why not?

 

- Spydertrader

[TIKITRADER 10]

These highlighted laterals have similarities, although some that have similarities may be sub-grouped a little different. ( not sure if this really makes a difference )

 

as example . . . start with symp then continue for some time before touching lateral boundaries.

 

or start sym p then followed immediately by a bar touch of lateral boundaries

 

* also I have not noticed in drill an outside bar following the symp , and before a touch of the boundaries. Not sure of the importance of this yet if any ( #4)

Edited January 26, 2010 by TIKITRADER
clarify

[FilterTip 10]

  Spydertrader said:

Review my answer. My response to you should indicate the following ...

 

"While yes you did accurately assess the individual particulars of the area under discussion (decreasing volume, dominant direction, etc), you did not in your post (which listed three reasons for knowing the direction of Lateral exit), provide the additional (hence my use of "more than three [that you provided] reasons") pieces of information (context and order of events) one should know prior to reaching a conclusion about this specific event. In addition, you have not yet completed the process of understanding the simiarities of this specific type of lateral, nor have you fully reviewed the various subtle differences which would allow you to accurately see all the various information provided by the object itself. As I result, I recommend avoiding reaching any coclusions which take you outside the current area of discussion."

 

[end translation]

 

Step by step means finish one step before moving to another step.

 

- Spydertrader

 

What...?

 

I need a coffee

 

Thx

[romanus 10]

  Spydertrader said:

Seven Examples (Final Step in Similarities Section).

 

See attached.

 

Which Laterals listed comply (meets with the test provided) with those examples which exist in The Lateral Formation Drill? Why or Why not?

 

- Spydertrader

If the test that you are referring to is mentioned in post 1282 ("... this one type of Lateral (begins with a Sym pennant, and some bar in the future creates a boundary with Bar 1 of the Sym").

 

 

, then all examples, except for # 3 (which doesn't begin with a Sym pennant) meet the test.

[Spydertrader 10]

  FilterTip said:

What...?

 

Read, the response S ------ L ------- O ------ W ------ L ------- Y.

 

- Spydertrader

[Spydertrader 10]

  romanus said:

then all examples, except for # 3 (which doesn't begin with a Sym pennant) meet the test.

 

Incorrect. You see. You believed you had this down correctly, but not quite 100% accurate. Hopefully, it now makes sense why I didn't want you moving forward prior to completing this portion.

 

- Spydertrader

[FilterTip 10]

  Spydertrader said:

Seven Examples (Final Step in Similarities Section).

 

See attached.

 

Which Laterals listed comply (meets with the test provided) with those examples which exist in The Lateral Formation Drill? Why or Why not?

 

- Spydertrader

 

Do Comply:

1.

Starts with Sym and because it has a bar which creates a Lateral boundary with Bar 1 of the Sym.

4.

Starts with Sym and because it has a bar which creates a lateral boundary with Bar 1 of the Sym.

6

Starts with Sym and because it has a bar which creates a lateral boundary with Bar 1 of the Sym.

7.

Starts with Sym and because it has a bar which creates a lateral boundary with Bar 1 of the Sym.

 

Do Not Comply:

2. A bar does not create a lateral boundary with Bar 1 of the Sym, prior to a bar that exceeds the lateral boundary

3. Lateral starts with a FBP.

5. A bar does not create a lateral boundary with Bar 1 of the Sym, prior to a bar that exceeds the lateral boundary

 

..

Edited January 26, 2010 by FilterTip