Iterative Refinement

Spydertrader, thank you for your kind offer.

I'd very much like to do it. Unfortunately this weekend I have to attend to a health related emergency in my family, and I don't know when I can get in front of my computer and for how long. But if you and others meet and discuss I'll either join you from time to time, or review the log later.

Thanks again.
Quote from Spydertrader:

How about this? We walk through each bar on the ES Chart you posted above - beginning with the third bar of your screen shot. Only instead of me telling you how to trade it, we walk through so you can 'see' the logic for yourself and know what decisions to make and when to make them.

We can do this in the ET chatroom to make it faster (nobody is in there on the weekends), or maybe over Skype and GotoMeeting.com type of shared view of a chart.

However, a properly annotated chart remains the first requirement of a trader looking to 'see' the signals provided by the market. As such, we have a few things missing from the ES chart posted above. Add them to the ES, so we might have a better opportunity to 'know' the context at all times. Highlight (in any fashion you desire) all Pennants and Lateral Formations.

- Spydertrader
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Hey Spyder, having a session would definitely help a ton. I thought about that "choppy" period all day yesterday and today and must confess having difficulty using only ES and YM to see the right side, even after the fact. It seemed like the 1-2-3's were having a standoff. I'd love to join in the discussion and the annotated chart will be ready to roll. :) Thank you.
 
Quote from TIKITRADER:

...I was with others at the time when this was discussed at the moment.
A lot of good thinking was taking place.
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yes, five pairs of eyes is def better than just one.
 
Quote from cnms2:

Unfortunately this weekend I have to attend to a health related emergency in my family, and I don't know when I can get in front of my computer and for how long.
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No worries, and I hope your family situation improves soon.

We do not have to do it this weekend. We can begin the discussion here (in this thread) for now, then walk through the period (in real time) at some point in the future using gotomeeting.com (or similar service) where more people can tune in.

- Spydertrader
 
Ok, ok... So I am not the only one doing this stuff on a Saturday evening :)

...and I hope your family situation improves soon....
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Same here cnms2...

I have annotated the YM-ES chart with how I see it. They are pretty sloppy as I am on a laptop with MS Paint as my tool.

I too would like to sit in on a chat if the gang decides to get together.
 

Attachments

OK, so cnms2 annotated the Pennants and The Outside Bars. A good start for sure, but what needs added?

Lateral Formations.

We want to make sure we annotate Lateral Formations as they provide context, not only as part of a Price and Volume sequence from Point Two to Point Three, but also in terms of determining what must come next if the market has signaled the trader sits on the wrong side of the market.

Once added to a chart (See attached), we see the attempt at a BO of a Pennant actually created the Lateral Formation. I say 'attempt' at B.O. becuase while Price did leave the Pennant formation, it did so on decreasing Volume. As a result, we have here a subtle difference between a true FBO (breakout on increasing Volume, but Price closes back within a formation boundary) and what the market has shown us.

When what must come next doesn't, expect the trend to change.

- Spydertrader

<img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=1804436>

Hint: Also note the Huge disparity in Volume from the Peak Volume Bar. What often has this Volume signature? What must come next? What must come next if we sit on the wrong side of the market?
 

Attachments

Quote from Spydertrader:


We can do this in the ET chatroom to make it faster (nobody is in there on the weekends), or maybe over Skype and GotoMeeting.com type of shared view of a chart.


- Spydertrader
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This was VERY DIFFICULT for me to navigate as well...

That being said, I think getting together to review is a great idea.

Count me in as well.
 
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