Then I encourage you to look closer. The example Tums provided had but a single channel. The chart of mine you referenced had a Point Three Up channel form within a Point Three Down Channel. See attached.
Single Channel:
<img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=1822073>
Competing Channels:
<img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=1822070>
And I referenced two bars in response to question posted with respect to "moving a Point Three" and not "deciding to enter a long trade." In other words, a question about moving or 'fanning' a trend line is quite different than determining when to enter a trade. As to the latter, when what must come next doesn't, we expect the trend to change. Soooooooo, if you enter long on increasing black PRV, and on the next bar, you see decreasing Black Volume, what does one believe will happen next? Change. Since we have change prior to either a Volatility Expansion and / or a Flaw, and since we (more often than not) need a VE or Flaw before we start to think 'FTT' then what we must have before us is either Price continuing to move laterally (examples, Pennant, Lateral Formation, Lateral Channel, Lateral Movement) or an FTT. Since we already eliminated FTT (due to no VE or Flaw) that leaves Pennant, Lateral Formation, Lateral Channel or Lateral Movement. We don't have a Pennant. We don't have a Lateral Channel. We don't have a Lateral Formation. What does that leave? Lateral Movement. What do we 'see' from Volume from Lateral Movement in an Up Channel? Decreasing Black Volume. What did we 'see' again on Bar #6? Decreasing Black Volume.
So we either have an FTT (and we have shown why we don't 'think' this first), or we have Lateral Movement. And if we have Lateral Movement, then Price hasn't finished moving from Point Two to Point Three.
As such, we will then need to move the RTL.
What I posted above speaks to the need for everyone to have a rock solid foundation with respect to the fundamentals. Knowing what must come next in order for the market to validate or invalidate the right side of the market remains the same for all traders. When the market delivers neither signal, one waits (hold if in the market, do nothing if sidelined).
One should have entered long prior to the analysis of continuing Lateral Price movement as the Close of the bar occured well beyond the point in time where Price began to rise on increasing black PRV.
I have no problems with questions such as these. However, make sure, you apply the answer to the correct question. The original question (as I understood it) asked about moving a Point Three, and not, about entering a trade. If I misunderstood the original (November) Question, then I apologize for the confusion.
- Spydertrader
