Iterative Refinement

Quote from Spydertrader:

Perhaps, you could take a moment to post your thoughts on the Entry and Hold. In this way, others may learn from your insights - just as you now wish to learn from mine (or Avi 8's).

- Spydertrader
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Good point.

Entry was made on the 11:40 a.m. bar on a newly formed Point 3 of a DOWN channel. Increased RED PRV on this bar confirmed then new channel down.

I personally was skepitical on this bar (11:40) because price closed back within the previous bars range AND we had not broken out (down) from the lateral starting on the 11:25 a.m bar.

After entry you continued to see price move lower on +PRV until the 12:00pm bar. On that bar you see a VE and an Intra Bar shift and the bar closes near its high signaling Non Dom traverse is starting.

12:05 and 12:10 show -PRV with 12:10 being lower than 12:05. Price also closed near the low on each of these bars.

12:15 pm showed +RED PRV again so time to draw a new accelerated channel using this bar as our new Point 3. Volume closes higher and price closes lower than the previous bar.

12:20 creates a VE, an intra bar shift and closes above the midpoint of the prior bar.

Hope Im in the ballpark.
 
Quote from TraderD72:

Good point.


12:05 and 12:10 show -PRV with 12:10 being lower than 12:05. Price also closed near the low on each of these bars.
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Thanks for the explanation, TraderD72. At 12:05 and 12:10 I'm assuming you were thinking price would continue down based on the condition of a lower low and low bar closes on both bars. Could you share what you were thinking at 2:35 and 2:40 (the black box in the chart with the arrow pointing toward it)? There we had high bar closes on price heading higher. Were you anticipating a resumption of increasing black or were you more cautious because of the lower volume levels? Trying to connect the dots. Thanks.
 

Attachments

Just noticed something. My apologies for some of the lines. I was tinkering with the chart when I saw that question and just automatically snipped. Of course, there is no excuse for the lack of annotations. Four stepper in progress. :D
 
Quote from Padawan:

Thanks for the explanation, TraderD72. At 12:05 and 12:10 I'm assuming you were thinking price would continue down based on the condition of a lower low and low bar closes on both bars. Could you share what you were thinking at 2:35 and 2:40 (the black box in the chart with the arrow pointing toward it)? There we had high bar closes on price heading higher. Were you anticipating a resumption of increasing black or were you more cautious because of the lower volume levels? Trying to connect the dots. Thanks.
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Padawan,

I saw the 2:20pm bar start an HVS ( Hope this is the correct observation) lasting until 2:40 pm bar.

Based on the very low volume on the :35 and :40 bars I couldnt identify either as a new, steeper Point 3 up channel.

I almost expected the 2:45 bar to do what it did...break the RTL on increased RED volume.

Again these are just my thoughts and views at the time. I hope they are of some help.
 
Quote from TraderD72:

Padawan,

I saw the 2:20pm bar start an HVS ( Hope this is the correct observation) lasting until 2:40 pm bar.

Based on the very low volume on the :35 and :40 bars I couldnt identify either as a new, steeper Point 3 up channel.

I almost expected the 2:45 bar to do what it did...break the RTL on increased RED volume.

Again these are just my thoughts and views at the time. I hope they are of some help.
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Yes, your thoughts definitely help. I was thinking the same there, too, actually. For the first time, I drew in two channels well in advance of the point 3. It happened Friday, one was the little green down channel that we just mentioned and the other was the up brown channel with the low of the day as pt1. Price hit and bounced off of them on the point 3 nearly to the tick.

I'd like to think it wasn't luck, but for now based on my inconsistent sim performance that's what we'll call it. I started practicing drawing channels in advance after reading about MAK doing so while describing the "pseudo bounding characteristics" of channels (I think that's the phrase he used). It helps to see if what you anticipate actually happens. It also helps to see when what you anticipate doesn't happen. Now, if only everyday happened like those two channels...
 
Quote from TraderD72:

...Hope Im in the ballpark.
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Great work 72.

I'll add a few more items of interest regarding this trade to further the discussion.

The entry: Since the ES was in a lateral formation, this gave me permission to look at the YM. What did the YM tell me around the time I entered (11:43:40)?

The hold and the exit: Note the similarities of the two bars, they almost 'look' the same. (1200 es bar and 1220) Why did I hold through one but not the other? Now look for the differences.

One final point, note the time of day for the exit. Also I was trading from a hotel room on my laptop with a 12" screen, and I had to go to my other work. (avi 8ing) :D
 
Quote from Avi 8:

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The hold and the exit: Note the similarities of the two bars, they almost 'look' the same. (1200 es bar and 1220) Why did I hold through one but not the other? Now look for the differences.
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When I reviewed your trade I noted the following:
12:00 bar was second VE so reason to start thinking "FTT", but since no flaws occurred before this bar one might hold and closely monitor YM for change.

In forming the flaw that followed, 12:05 had 75% black volume which is in line with FTT or retrace but note poor close. 12:10 closed with decreasing volume, equal high and lower low so it is a down bar and not in line with continuation of a retrace. Also note DT/odd harmonic which said down. At this point this formation could be HVS or become a Dip so watch for increasing red volume anticipating resume of dominant trend downward.

12:15 increasing red volume confirmed Dip = hold short.

12:20 third VE in addition to prior flaw would give reason to look for exit at/near LTL so watch YM closely.

12:23 YM while halfway through the bar showed large PRV slightly less than previous bar yet only a 6pt vs 25pt range. This says change so exit/reverse and smile. :)
 
Quote from Avi 8:

Note the similarities of the two bars, they almost 'look' the same. (1200 es bar and 1220) Why did I hold through one but not the other? Now look for the differences.
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The differences I see between the 2 bar themselves are:

The range on the first bar (12:00) is smaller then the second. 1.75 points vs. 3.5 points.

The first bar closed .25 under its open vs. 1.25 on the second.

The first bar closed back within the range of the previous bar where the second did not.

If I add volume into the picture I notice some differences as well but based on the way you quesion was worded, I am just noting the differences in the BARS only.

Is this a correct interpretation of the question? Or should I include the volume to give you a better answer???
 
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