The Price / Volume Relationship

[xioxxio 10]

Here you go...have my own brand of annotating though......(see Gaussians. I annotate the non-dom in grey)

 

hth, Vienna

 

Thanks for this, quick question at bar 40 or so did you draw the dom blue channel?

[patrader 10]

here's the rest of the week.hth

[vienna 10]

Thanks for this, quick question at bar 40 or so did you draw the dom blue channel?

 

No, I think later, when price made a new high, prob around bar 48. That is normally when I draw a slower channel (otherwise you might be too early). The slower LTL then gives you a target if you are long, and resistance, as well as support.

 

This was also an example of using a previous Point 3 or a previous trough as the new point One...Spyder posted about this.. perhaps somebody has a link to the thread (s) where he mentions it.

 

hth,

 

Vienna

[vienna 10]

These are the best opportunities IMO...

 

Just like we saw yesterday at ES before a great move up.

 

Volatiltiy expansion on the traverse as well as the forrest (main channel of the day) followed by an FTT.

 

 

regards,

Ivo

 

Please see attached...I don't chart the Euro, so I guessed the Gaussians...question is: wouldn't you want the price bars confirmed by Volume to make sure that this is really done going down?

[vienna 10]

Mada for this morning's EURUSD.

 

 

For me it helps to distinguish between signal and entry bar. Signal bar is the FTT and entry is as soon as the FTT bar is taken out by a few ticks. But in this case I was early as often is the case.

 

 

regards,

Ivo

 

Interesting post...reminds me of Vorzo's entry ideas in the ET Futures thread.

Forums - Spydertrader's Jack Hershey Futures Trading Journal

 

At least for his Point 3 entries, he used to wait for one bar in the direction of the trade (like your signal bar) and then enter when the high of that bar was taken out.... I am not sure if you are saying your signal bar has to close in the direction of the trade, does it? Can't tell from the picture...

I found this to get me in late and with a stop often too far away for good r/r for many point 3's, never tested it on FTT's...you don't have that issue?

Basically, Vorzo (and you) wait for confirmation (taking out the high of the bar) before taking action...

[vienna 10]

Yesterday, EOD.

Had to stop around 1:30, so anything after that is hindsight

 

HTH, Vienna

[mj_07_nc 10]

I had a pretty good day today. There were several areas that confused me and I was wondering if anyone might comment. I have circled the two areas on the chart and inserted some commentary as to what I was thinking at the time. Happy Friday and have a good weekend.

[ivob 10]

On a side note, I find it hard to continue to trade once I have an early winner. I have a big fear of giving back gains. Anybody else have this problem?

 

I look forward to continued dialogue. Thanks again!

 

Same here.... but we have to learn to stay cool. I believe this mentality keeps us from having really big gains. We should realize that and do our thing. Push buttons.

 

Ivo

[ivob 10]

I have seen this kind of FTT's often and know it's a A+ trade. No. I don't miss volume. Also Spyder does not talk about "confirmation by volume" as he claims volume precedes price.

 

First we get VE. then price tries to reach the Left trendline but fails. Then the moment it goes up I take the trade. If you take the trade the moment price goes up then it will go up at least some more ticks after my trade normally. Enough to put my stop to almost BE. From then on you follow bar by bar. Hold towards RTL. It breaks thru RTL so continue to hold.

 

As you can see I took the trade actually quite late..... Could have been somewhere halfway the FTT bar.

 

regards,

Ivo

 

 

 

 

Please see attached...I don't chart the Euro, so I guessed the Gaussians...question is: wouldn't you want the price bars confirmed by Volume to make sure that this is really done going down?

Edited October 7, 2011 by ivob

[vienna 10]

I had a pretty good day today. There were several areas that confused me and I was wondering if anyone might comment. I have circled the two areas on the chart and inserted some commentary as to what I was thinking at the time. Happy Friday and have a good weekend.

 

Attached my take on it...full disclosure: cleaned it up a bit EOD..am not that neat..and couldn't read half of it today until it was too late....

 

hth, see the areas you circled...we were in 2 lateral traverses with all kinds of nasty stuff (bar 31!)...the traverses widened the container and went from pt 2-3.

 

hth, Vienna

[ivob 10]

Yes..of course it has to close in the direction of your trade!! Preferrably at the high.

 

But it has two sides...enter late and take some heat maybe...or enter early and have a better price but more risk of being wrong/zigzagged. Well..if it's a real FTT there won't be too much zigzagging.

 

Best time for FTT is after a VE... checkout today's ES...the last 20 minutes or so. Great move down.

 

Anyway, one can also enter late and be wrong...incurring a bigger loss. It's probably better to enter early because you can enter early, be wrong, still make money and be on the right side of the market again.

 

The best is to enter some time while the FTT bar is going on. As soon as you know it's an FTT. But yes..I do sometimes wait for this bar to be taken out. Sometimes I enter right at RTL break but not later...I hate to enter at point 2. Point 2 is a point to exit (or reverse) and enter again at point 3 unless price has moved a big deal from 1-->2 and broke RTL.

 

So be careful in the markets with confirmation because if things are clear for everyone it's too late...you have a crappy price. Much easier to see the things when price is far away from your entry.

 

Think upside down...the moment you take the trade and price is going your direction you think "If I am wrong...this would be a great place to reverse... which I will do if price goes back and passes by one or two ticks this point here.".... So basically it's a risk free trade because you can only lose the spread right? And will be on the right side of the market again.

 

Everything is upside down in the market because the market acts against human psychology. Price goes up if it cannot go down anymore and vice versta. NEVER enter thinking something like "Wow what a move..I will join it now" because the market always tries to fool you. It spends the most time at crappy prices that will be zigzagged or taken out, the opportunities are on the edges (FTT). At the beginning of the move. How far it goes...I have no clue..let the market surprise you!!

 

regards,

Ivo

 

 

 

 

 

 

Interesting post...reminds me of Vorzo's entry ideas in the ET Futures thread.

Forums - Spydertrader's Jack Hershey Futures Trading Journal

 

At least for his Point 3 entries, he used to wait for one bar in the direction of the trade (like your signal bar) and then enter when the high of that bar was taken out.... I am not sure if you are saying your signal bar has to close in the direction of the trade, does it? Can't tell from the picture...

I found this to get me in late and with a stop often too far away for good r/r for many point 3's, never tested it on FTT's...you don't have that issue?

Basically, Vorzo (and you) wait for confirmation (taking out the high of the bar) before taking action...

Edited October 7, 2011 by ivob

[patrader 10]

10-7-11 degapped rth ES.For those interested the following are auto generated to help read the market.Green up and Red down arrows = increasing volume ibgs.Black up and down arrows = decreasing volume ibgs.Pink dot(on top of bars)=down stitch.Dark blue dot(on bottom of bars) = up stitch.Lite blue colored bar=sym bar.Lite green colored bar = decreasing volume ftp with bar close above open.Pink colored bar = decreasing volume fbp with bar close below open.Gray colored bars are all other ftp's or fbp's or eh's.hth

[amisme 10]

10-7-11 ES 5m. Had a late start so the first 2 hours or so are hindsight. Someday I might develop clearer volume annotation habits. It's a work in progress.

 

Re: bar 31, I considered it to be an unusually large price movement on a sub-tape fractal that did not take up enough chart space to annotate. A puzzle, though, to deal with in real time.

 

If I am correct and the weekend doesn't change anything, Monday will start out looking for a pt3 of a down traverse. I am sometimes dubious about weekend carryover though, it's a lot of time for sentiment to change in the minds of the market participants.

 

Waiting too long for confirmation on an FTT is definitely my biggest problem right now. I may start shooting for entries on pt3s and see how that treats me.

 

I am glad to see that our charts for today are very alike.

[xioxxio 10]

Vienna, the IBGS, what do they tell you, is that not more for "leaves and bugs"?

 

Thanks

[ivob 10]

I have to correct myself here....

 

The FTT itself.....is a failure to reach the left trendline.... So the FTT bar itself does not have to end at its high... it all depends when in the bar the FTT (the failure to reach LTL) takes place... Quite quickly after the FTT you expect price to go in your direction which may or may not be in the same bar. If the FTT takes place earlier in the bar then yes, you expect the bar to be at its high. (assuming we take a long).

 

Sometimes we even have a one tick FTT. We make a VE...next bar (FTT bar) tries to reach LTL by just one tick and then goes the other way (your way). checkout attach (it may have been 2 ticks...). This is the moment to enter.

 

I believe I can spot the FTT not just by not touching LTL but also by how price moves in the bar...(the way it ticks..).. It's calm....not nervous... less participation... The action was before, the action is over, the channel is over.

 

In this example after the VE you have your finger at the trigger... You wait one bar... ok this could be the FTT but close near the low... next bar...few ticks down..then up... this must be the FTT. Enter.

 

regards,

Ivo

 

 

 

Yes..of course it has to close in the direction of your trade!! Preferrably at the high.

[ivob 10]

Two remarks.

 

1.

Don't wait for the market to confirm before taking the trade. (well one tick is ok..) Wait for the market to confirm after the trade. If it doesn't, get out. You want to be at the beginning of the move..not the middle or the end. Especially do not wait for the market to de-confirm your trade because then you have a loss. Stops are just for emergency...don't let price hit it. In case of a long if price does not go up quickly get out. Because you can count on it that the market will go down if it doesn't go up. Don't wait for it to go down.

 

It's not a bad strategy actually to always get out...unless price goes in your favor very much. Something like a time stop.

 

Getting out is good. It frees your mind and you're ready for the next opportunity.

 

2. shooting for point 3...

I don't know...I don't find it easier to spot pt 3's than FTT's but you may..... In fact...the point 3 is just another FTT on a non dominant channel or on the tape. Best strategry (IMO) is recognizing FTT's.

 

Ivo

 

 

 

 

 

 

10-7-11 ES 5m. Had a late start so the first 2 hours or so are hindsight. Someday I might develop clearer volume annotation habits. It's a work in progress.

 

Re: bar 31, I considered it to be an unusually large price movement on a sub-tape fractal that did not take up enough chart space to annotate. A puzzle, though, to deal with in real time.

 

If I am correct and the weekend doesn't change anything, Monday will start out looking for a pt3 of a down traverse. I am sometimes dubious about weekend carryover though, it's a lot of time for sentiment to change in the minds of the market participants.

 

Waiting too long for confirmation on an FTT is definitely my biggest problem right now. I may start shooting for entries on pt3s and see how that treats me.

 

I am glad to see that our charts for today are very alike.

[xioxxio 10]

I have to correct myself here....

 

The FTT itself.....is a failure to reach the left trendline....

Ivo

 

The FTT is the failure to reach the right trend line. The right trend line is the dominant traverese, up or down.

[gamblerKi 10]

Hi Vienna,

 

 

Chart A is 4 Oct 2011 EOD. It is a clean chart without any annotations or degapping. The grid in the price pane represents 2-point ES.

 

Chart B is the snippet of your chart on 5 Oct 2011 (morning session).

 

The thing inside the pink rectangle looks like a tape to me because I couldn't find the non-dominant tape. But on your annotated chart, the thing inside the pink rectangle was a traverse. (Please refer to the attached chart)

 

What made you think the thing inside the pink rectangle was a traverse?

 

Thanks.

 

Regards,

 

Ki

[vienna 10]

Vienna, the IBGS, what do they tell you, is that not more for "leaves and bugs"?

 

Thanks

 

Well...think about entry, an Ibgs at the right moment can be a strong signal... check where they occur- look at b 12,31 (fakeout), 33, 73....

And annotating completely also helps prepare you to see more for the future. I should annotate stitches etc too, got lazy that day.

 

Vienna

[vienna 10]

Hi Vienna,

 

 

What made you think the thing inside the pink rectangle was a traverse?

 

Thanks.

 

Regards,

 

Ki

 

Ki,

 

..you could be right....this was a rocket (see the Volume level), they sometimes don't give you a tape break...then you get 3 bars inside and a huge pace drop on b 80...so i am thinking "Sym Lat". 17 bars closed inside the shadow of b76, basically going LTR...so I

annotated "Lat traverse". Note that inside of it, a nondom completed...

 

This is just what I see, could be different or flawed of course...

[vienna 10]

The FTT is the failure to reach the right trend line. The right trend line is the dominant traverese, up or down.

 

Xio,

 

You might want to reconsider that statement...

 

regards, Vienna

[vienna 10]

...No. I don't miss volume. .

 

regards,

Ivo

 

Ivo,

 

Interesting...I did that drill months back where i guessed (and drew) the price bars all day long by looking at volume only...at the end, I "knew" what kind of price bar was being formed in realtime in most cases...for example, if volume keeps accelerating to the end of the bar, you know the bar has closed at the top...so the two are completely connected, makes sense that you have trained yourself to do the reverse (for you, Volume is contained in the price bar, therefore you don't need it). That is called screentime lol.

 

Personally, I do like PRV , because it really does seem to give a heads up before things happen, especially if you watch the YM PRV at critical points, and I like to see pace levels, since they help clarify the big picture for me....but there are many ways to make this work. You probably are very sensitized to Price bar behavior, which might explain your great posts about the FTT!

 

thanks,

 

Vienna

[vienna 10]

Sorry for the serial posting, will go back and hibernate/lurk soon, I promise.....

 

See attached 60 Min chart for an example how the de-gapped Trendlines often act as support/resistance...amazes me every time.

[patrader 10]

In the spirit of "refinement", which two bar cases(http://www.traderslaboratory.com/forums/attachments/34/11926d1246812953-price-volume-relationship-tentapes.jpg) does the market sometimes combine the ibgs with the second bar of the two bar case? Why do ibgs's show up at so many "turning" points(pt 2,3 and ftt's) in the trading day? What effect or non effect do ibgs's have on laterals? Why did spydertrader say "An IBGS Bar (on increasing Volume) which breaks through the Lateral boundaries is the variety I use to 'kill off' the Laterals"(Forums - Iterative Refinement? How does increasing or decreasing volume play a role in reading ibgs's?

[ivob 10]

Hi Vienna,

 

Yeah but also PRV is deceiving because suddenly a lot of volume can come in in the last minute. As I trade mostly forex (and sometimes last 2 hours of the ES) I don't have volume anyway. It probably works but I only use price and see how the bar moves.

 

The FTT moves like a retracement. A retracement in the dominant direction(!!!)..... It's the last thing before change. It's like dry-up. There is no participation and price has to go to other areas to encounter participation. Price will always go to areas where people want to trade it and make volume. (buyers think it's a good price to buy, seller think it's a good price to sell). Pardon my simple English it's not my 1st language and my "Trader IQ" is even lower than that person who claims FTT is a failure to reach the right trendline ;-) Just kidding ;-)

 

All you need to do is wait for price to go into your direction after FTT. (at that moment I move to 1 minute chart where you would also see a FTT). The FTT doesn't move wildly....but slowly. Don't confuse the FTT with the FTT-bar as the FTT bar can move wildly and fast (after the actual FTT took place!!). I guess that's a IBGS (all these terms drive me nuts). In a fast market you can have VE, FTT and price moving in your direction in one bar...As long as price tries to go to LTL after that VE. Sometimes the FTT is just one tick but not impossible at all to catch because you have your hand at the trigger already.

 

Just follow very carefully how the bar is formed. It should go back slowly (= probably low volume LOL) one final time and try to reach LTL. (and shake out all those people who entered too early and give false hope to people who were holding..).

 

In a slow market it can take 3 bars...(you mentally put them together). As long as price is actually trying to reach LTL....and then it goes in your direction. That's when to enter. It would be interesting to make screenshots of all different kinds of FTT's that exists and learn about them. Even better: video capture.

 

Ivo

 

 

 

 

 

Ivo,

 

Interesting...I did that drill months back where i guessed (and drew) the price bars all day long by looking at volume only...at the end, I "knew" what kind of price bar was being formed in realtime in most cases...for example, if volume keeps accelerating to the end of the bar, you know the bar has closed at the top...so the two are completely connected, makes sense that you have trained yourself to do the reverse (for you, Volume is contained in the price bar, therefore you don't need it). That is called screentime lol.

 

Personally, I do like PRV , because it really does seem to give a heads up before things happen, especially if you watch the YM PRV at critical points, and I like to see pace levels, since they help clarify the big picture for me....but there are many ways to make this work. You probably are very sensitized to Price bar behavior, which might explain your great posts about the FTT!

 

thanks,

 

Vienna

Edited October 9, 2011 by ivob