Iterative Refinement
- Thread starter Spydertrader
- Start date
Wow, it's rare that a question of mine generates such discussion...
It seems as if we agree that a pt 3 REQUIRES rising volume afterwards to confirm it - no exceptions.
I simply thought that a pt2 required rising volume prior to confirm it (i.e., after the pt1 & before pt2), or it wasn't a valid pt2 yet. Since (in my mind) the pt2 was never validated, I never considered the pt3 as valid and therefore no 123 channel. Essentially, I was still waiting for confirmation when Spyder's pt3 (my pt1) occurred.
I also agree about seeing the 2nd low as an FTT, and therefore we were in transition. In other words, I still saw it as tradable...
Volume validates a great deal to me... perhaps not at the same rate as everyone else...
I'll catch up one day.
Hearing the different views helps. This is why I miss the meetings, tho few wanted to discuss chart analysis unfortunately.
Thanks, everybody!
It seems as if we agree that a pt 3 REQUIRES rising volume afterwards to confirm it - no exceptions.
I simply thought that a pt2 required rising volume prior to confirm it (i.e., after the pt1 & before pt2), or it wasn't a valid pt2 yet. Since (in my mind) the pt2 was never validated, I never considered the pt3 as valid and therefore no 123 channel. Essentially, I was still waiting for confirmation when Spyder's pt3 (my pt1) occurred.
I also agree about seeing the 2nd low as an FTT, and therefore we were in transition. In other words, I still saw it as tradable...
Volume validates a great deal to me... perhaps not at the same rate as everyone else...
I'll catch up one day.Hearing the different views helps. This is why I miss the meetings, tho few wanted to discuss chart analysis unfortunately.
Thanks, everybody!
Three ways exist for Price to move from Point One to Point Two.
Three ways exist for Price to move from Point Two to Point Three.
One way exists for Price to move from Point Three into the channel.
- Spydertrader
Personally, I would enter short on the pt3. I have not yet mastered the entry on the actual pt1 bar. This serves me well on days like today while the runup (9:30-11) had several FTT->FBOs before the sentiment shifted.
I had been struggling with some kind of brainfreeze when I saw an ftt, I would predict :eek: that price would have to break out of the channel. Spyder fixed that flawed logic for me...
The slight return to dominant volume is an issue that I've been mulling over since Callmate provided this detailed explanation for the sequence of falling dominoes (thanks, Callmate).
http://www.elitetrader.com/vb/showthread.php?s=&threadid=113310&perpage=6&pagenumber=274
In Callmate's post, the third image shows a black bar with slightly increasing volume. However, the falling dominoes sequence had us anticipating decreasing black volume with increasing price. At my experience level, that bar would've given me problems for two opposing reasons:
1) I might think this bar was an indication that the dominoes didnât fall as expected and that the uptrend was about to resume.
2) This bar closes only a tick above its open and has significant volume but little volatility compared to the previous bar. Therefore, a trader might think that the pt3 down was beginning to develop and therefore anticipate price moving lower from that point.
I'm wondering how she (callmate) and/or anyone else would treat such a bar. The following two images in Callmateâs post show how both scenarios (pt 3 up and pt 3 down) are possible, but what would you do on that bar if you were already short? Would you get long on that bar because you see price advancing on increasing volume? Or would you hold short?
Hope this makes sense. Any help or assistance is greatly appreciated.