The Price / Volume Relationship

[PointOne 10]

In my view, you have a complete sequence down starting bar 71 prev day (1520, open), followed by a complete sequence up starting bar 78 (1555, open). The up sequence ends with an FTT of the accelerated BBT (or whatever level of container) formed by the bars 3 and 4 of today (0940 and 0945, open), its pt 2 being Mon, and pt3 Tue.

 

Thanks, yes those are exactly the sequences I'm trying to get to work, that must have been what happened. Where's P2 of your 1520 sequence?

[ehorn 10]

Get your Pre-flight check established.

 

* Where am I in the sequences?

* How fast are things changing?

* WMCN?

 

Perform the MADA routine

 

Extract from the pool

 

Wash, rinse, repeat.

[MomentumMike 10]

In my view, you have a complete sequence down starting bar 71 prev day (1520, open), followed by a complete sequence up starting bar 78 (1555, open). The up sequence ends with an FTT of the accelerated BBT (or whatever level of container) formed by the bars 3 and 4 of today (0940 and 0945, open), its pt 2 being Mon, and pt3 Tue.

 

I saw this, but dismissed it because of what appeared to be the invalidation of P1 due to gap removal. Did you view this as a valid double-top with gap removed? Or maybe a down-traverse w/o gap removed?

[romanus 10]

In my view, you have a complete sequence down starting bar 71 prev day (1520, open), followed by a complete sequence up starting bar 78 (1555, open). The up sequence ends with an FTT of the accelerated BBT (or whatever level of container) formed by the bars 3 and 4 of today (0940 and 0945, open), its pt 2 being Mon, and pt3 Tue.

Thank you for sharing this. In the attached, bar 1 on increasing volume fails to reach the LTL and signals peak volume, bar 2 is IBGS on increasing volume and it's close breaks the previous up tape drawn from the final bar on the previous day (black arrow pointing to it). Why would one hold through it and not go short? Thank you.

[become 10]

Romanus, I sympathize with your frustration (though I worry less about binary logic).

 

As it happens, I went long on bar 2. If it will help, here's why.

 

Bar 1 isn't peak volume, since the first bar of the day always has far more volume than the last 2 bars of the preceding day. (Your "P" is just marked by an algorithm, and I would drop it altogether, as it registers too many false positives, and misses some real Peaks.)

The ibgs is a subfractal retrace that fails: increasing volume that fails to break the prior bar's low, and retreats substantially from its low. As far as sequences go, I expected to see increasing black to complete the sequence begun the day before, and we hadn't got it yet. So my analysis confirmed my expectations.

 

I exited on the VE 2 bars later. I remain unconvinced about entering short because of a lower volume VE, just before an important news item - context tells us to expect a reduction in volume. If the news had been a substantial positive surprise, we would have had a big black bar, and would be seeing the preceding 2 bars as a lateral retrace.

 

HTH

 

- become

[rs5 10]

Wednesday 24 February 2010

[cnms2 10]

Thank you for sharing this. In the attached, bar 1 on increasing volume fails to reach the LTL and signals peak volume, bar 2 is IBGS on increasing volume and it's close breaks the previous up tape drawn from the final bar on the previous day (black arrow pointing to it). Why would one hold through it and not go short? Thank you.

The day starts looking for pt3 up. Bar 1 is usually much larger volume than the 80, 81, so I wouldn't call it peak volume. It sets pt3. Bar 2 is translation on increasing black volume. Its close is a great place to enter long (or wait if the second bar is too early for your level of confidence). Bars 3 and 4 are translations too on decreasing black volume anticipating change. Bar 3's mode is up, bar 4's mode is down (decreasing volume and close outside). Bars 5 and 6 are FBPs on decreasing red volume building a lateral (after pt3). Next bar breaks down on increasing red volume. You could've reversed short on bar 4 (highest high, and highest close), or a little later. Edited February 24, 2010 by cnms2

[cnms2 10]

Thanks, yes those are exactly the sequences I'm trying to get to work, that must have been what happened. Where's P2 of your 1520 sequence?

I considered 1525 (open) bar (decreasing black volume) as the non-dominant move of that container (incr red, decr black, incr red). Especially during high volume periods, which usually happens at the start and the end of the day, you could have traverses where moves can happen over a single bar (I remember some examples provided by spydertrader)..

[cnms2 10]

I saw this, but dismissed it because of what appeared to be the invalidation of P1 due to gap removal. Did you view this as a valid double-top with gap removed? Or maybe a down-traverse w/o gap removed?

I don't quite understand your view here... I considered the volume sequence, and removed the price gap. I didn't look for a double top.

[Spydertrader 10]

Wednesday 24 February 2010

 

According to your chart annotations, your 'day' began at 16:00 PM Tuesday. Do you agree with such a statement, or did your 'day' actually begin earlier than 16:00 PM Tuesday? Also, your chart shows a mysterious red Bar as its final (Tuesday) Bar. I do not have such a bar on my chart. IF said Bar represents a function of the charting software (or datafeed), take care not to include said bar in your analysis and decision making. Lastly, you have additional 'laterals' highlighted on your charts (in addition those in The Lateral Formation Drill [and Follow Up]). Make sure you have a specific rule set in place (based on a process of differentiation) for these laterals (in addition to those in The Lateral Formation Drill [and Follow Up]). Otherwise, the automation of these objects may cause you to 'see' things in a far different fashion than required.

 

(All Times Eastern and [close of] ES Bars)

 

HTH.

 

- Spydertrader

[double eagle 10]

Here's my chart for 02/24/2010.

[Spydertrader 10]

Here's my chart for 02/24/2010.

 

[ptunic 10]

Thank you for sharing this. In the attached, bar 1 on increasing volume fails to reach the LTL and signals peak volume, bar 2 is IBGS on increasing volume and it's close breaks the previous up tape drawn from the final bar on the previous day (black arrow pointing to it). Why would one hold through it and not go short? Thank you.

 

Romanus, I had a pretty similar view on that section to become's analysis (made a mistake bar 2 in real-time though) see attached snippet.

 

Here's my thoughts kind of starting around 15:35 on 02/22/2010:

 

Pink Down Tape:

I started this (on my snipet labelled 1 in pink) because of an outside bar/ibgs, with decreasing red.

 

By 15:45 you see the huge red down bar and this is the dominant red part of the pink down tape. Though I didn't label it on this snippet it also breaks a RTL of a Traverse or possible channel as well.

 

Then we get 2 black bars, I label these as non-dominant (pt 2 to pt 3 movement). The end of day volume distorts their volume but once adjusted for end of day volume (which I don't know the rule but just roughly divide it in half or so) they are decreasing black.

 

The last bar of the day is really interesting. I see this as an ibgs. The bar starts with dominant red volume, confirming that it has created the pt 3 of the pink down Tape. However, on the very same bar, price moves all the way back and closes on the open, creating a kind of spike (not sure if these are officially spike bars or not). This to me is an SOC/FTT. I would still want see confirmation, in the form of a BO of the RTL in a bar or two, but other than that by end of bar I am annotating this as the pt 1 of a new black Tape.

 

So let's go to the next bar, which is now beginning of the day, bar 1 of 2/23/2010. I see this as dominant black which confirms that the previous bar was the pt 1 of our new up tape (labeled forest green on my snippet). Actually, this and the next bar I was very much on the fence on, because of the beginning of day volume effects, you could easily make the case the mode was non-dominant (decreasing volume) as well. But for this purpose what I feel makes the most sense is it is dominant black volume.

 

Bar 2 I labelled as non-dominant red volume, thus confirming the previous bar as the pt 2 of the green Up Tape. The reason I did this even though its volume was increasing over the previous bar, was it is an ibgs. With ibgs, I give special wiggle-room if that is the right word, and I assumed that most of the volume was when the bar was making a higher high, as opposed to the downward retrace. I guess if you have YM, you have an advantage since you can look in more granularity, but I only use 5 min ES (and wasn't looking at PRV in real-time either so had no way of knowing).

 

Bar 3, I labelled as dominant black volume, even though volume was slightly decreasing. Again, this gets to mentally splitting up Bar 2 into 2 parts: a high volume increasing black bar and a decreasing red bar. So this confirmed the previous bar (bar 2) was the pt 3 of the black up tape.

 

Bar 4: at this point we are passed the pt 3 so we are looking for a SOC. I'm not sure if the SOC is this bar, or Bar 5, or Bar 6 when you see the lateral formation, but one of the three bars ends the green Up Tape. In realtime, I labelled it differently (incorrectly), thinking the VE was sufficient enough to lead to the NSW moving on this fractal (Up Tape). So I was expecting a decreasing red BBT and than an increasing black BBT and then would look for the possibly final FTT. Of course that didn't happen, so I need to spend more debrief on when VE's are FTTs versus move the NSW.

 

It is very possible the Green Tape is a BBT or sub-fractal, instead of a Tape, but I labelled it as a Tape.

[innersky 10]

 

Why doesn't the Blue Thing belong to this chart?

 

--

innersky

[rs5 10]

According to your chart annotations.............

 

Thank you so much for your feedback! Actually I have the present up container from 13:05CST yesterday (14:05EST). And yes that mystery first bar - I have been starting the first bar at 8:25 so I could be "warned" regarding the position where the actual first bar of the day starts (before gap removal tool) - Thank you for noticing And thank you for the reminder that it needs to be taken into consideration now with the remove gap tool. Here is a view without that warning bar. I have shown vertical blue line at today's first bar.

 

Edit: Also with revised Sym Lateral annotation.

Edited February 25, 2010 by rs5

[Spydertrader 10]

Why doesn't the Blue Thing belong to this chart?

 

Because "The Blue Thing" does not accurately reflect the information provided by the market.

 

- Spydertrader

[rs5 10]

My current coding for laterals:

 

Fushsia = SYM Lateral per Lateral Drill

Cornflower = all other sym laterals

Chartreuse = all ftp laterals

Yellow = all fbp laterals

 

Focus is on the Sym Laterals per Drill. The others are there for decoration at the moment.

[Spydertrader 10]

Actually I have the present up container from 13:05CST yesterday (14:05EST).

 

Now that you have 'corrected' your 'start of day' annotations, you should have the ability to see where you have failed to include other annotations (some that existed previously and others which did not appear on your charts at all).

 

- Spydertrader

Edited February 25, 2010 by Spydertrader
needed to add an 'S'

[Spydertrader 10]

The others are there for decoration at the moment.

 

In order to determine whether (or not) such automated annotations add (or detract) value to your M - A - D - A, ask yourself, "What do I [you] think when those different color laterals appear on my [your] chart in real time?"

 

Do you think, "Damn! I still need to differentiate these things, but lets check 'inside' to see what is happening."

 

or, do you think, "O.K.. I'm in a certain type of Lateral (based on a certain color), so let's pay attention and see if I can learn something."

 

One answer indicates the lack of the need for the annotation itself, the other answer indicates an incorrect focus (on Price, rather than, on Volume).

 

Differentiation occurs after market hours. Applying the fruits of one's labor occurs during market hours. Make sure you are performing the correct tasks at the correct times. Again, since 'X' amount of time has passed since I first introduced you to, and provided the expected results from, thoroughly differentiating The Lateral Formation Drill (and Follow Up), and since you still appear to struggle with laterals which do not conform to those drills, I'm simply pointing out that looking at a problem from a different point of view, might provide some benefit.

 

- Spydertrader

[Spydertrader 10]

Edit: Also with revised Sym Lateral annotation.

 

Do you feel your chart contains all the necessary trend lines as directed by the market itself?

 

- Spydertrader

[rs5 10]

 

- Spydertrader

 

Thank you so much Spydertrader! I have removed all lateral notations leaving only the Sym laterals conforming with the lateral drill here.

 

Sym lateral 2 (on 2/23) is in the B2B segment of the up container and exits in the B2B segment continuing the dominant move.

 

Sym lateral 1 (on 2/24) is in the 2R segment of the up container and exits into 2B segment, continuing the dominant move.

 

The Sym laterals appear to exit in the dominant side of the sequence of the larger container being formed. I will need to test this to see if it occurs in all the other instances.

Edited February 25, 2010 by rs5

[innersky 10]

Because "The Blue Thing" does not accurately reflect the information provided by the market.

 

- Spydertrader

 

Because "The Blue Thing" is above our trading fractal?

 

--

innersky

[Spydertrader 10]

Because "The Blue Thing" is above our trading fractal?

 

Because placing "The Blue Thing" on your charts fails to provide sufficent information for most individuals to distinguish between one fractal or another. In other words, "The Blue Thing" says to the trader one thing, when quite another thing entirely is taking place.

 

- Spydertrader

[double eagle 10]

Thank you Spydertrader for the feedback.

 

Here is a second version of my 02/24/2010 chart. I removed the automated laterals and drew the laterals that I hypothesized would help me draw my guassians. I also attempted to come up with a better coloring and numbering scheme to provide clarity. You'll note that I made quite a few changes to the guassians as I tried to correct my nesting of fractals. Hopefully, I made a step in the right direction. I will know fairly quickly when the market opens if my medium weight pink trend (from 13:35) is going to be invalidated by a bar that goes above the gap adjusted 13:35 bar.

[Spydertrader 10]

Here is a second version of my 02/24/2010 chart.

 

Much better.

 

I will know fairly quickly when the market opens if my medium weight pink trend (from 13:35) is going to be invalidated by a bar that goes above the gap adjusted 13:35 bar.

 

This is how we learn. Step by step. Piece by piece.

 

Keep up the great work.

 

- Spydertrader