Iterative Refinement
- Thread starter Spydertrader
- Start date
Between the lateral movement and the low volume, not a beginner day IMO. Good for practicing...
YM for reference
It depends
on the view at the time for me. Sometimes I recycle p3 and sometimes p1 into my new p1. For one example, if the original p3 is close to the p1, then I usually recycle (as in re-use) the p1. If the p1 is far away and there is a more appropriate point closer, I will use it. It is often the p3 but may be just some p5 so to speak... This part is subjective for me right now. Basically, try to choose an appropriate p1 to go with the new p3, that produces the channel corresponding to the current market direction which you see at the time, be it shallower or steeper. The Gaussians will eventually let you know if there's another better choice.
I would like to thank everybody who responded to my earlier questions about CO channel and Gaussians.
I also received a lot of PMs.
This is a terrific group of people collaborating and making learning so much easier.
I am trying to clarify some thoughts wrt to CO channels and Gaussians subjects and will post responses as soon as I am able to write it up coherently.
In the meantime attached is my view of the morning and early afternoon. I have attempted to illustrate how I saw the 1-2-3-VE/FBO/FTT/FBO/BO-CHANNEL OVERLAP sequences during this period.
I have tried my newly acquired ability to see those sequences on previous days, and itâs working. Unfortunately I canât seem to see it once the lateral movement arrives â so more work is required (P/V relationship in laterals is covered in the Futures Journal).
I also received a lot of PMs.
This is a terrific group of people collaborating and making learning so much easier.
I am trying to clarify some thoughts wrt to CO channels and Gaussians subjects and will post responses as soon as I am able to write it up coherently.
In the meantime attached is my view of the morning and early afternoon. I have attempted to illustrate how I saw the 1-2-3-VE/FBO/FTT/FBO/BO-CHANNEL OVERLAP sequences during this period.
I have tried my newly acquired ability to see those sequences on previous days, and itâs working. Unfortunately I canât seem to see it once the lateral movement arrives â so more work is required (P/V relationship in laterals is covered in the Futures Journal).
Quote from tobbe:
I see both of us have a down channel for the end of the day. I actually think that channel was invalidated by a BO at 15:15 and replaced by a steeper down. I simply missed that.
I was already out of the market on the peaking red 4:00 EST bar. Yes, there was a BO of my orange steeper channel on the following bar.
Hi,
Especially consider using the old point 3 as a new point 1 if you notice a big change in volatility. (usually a drop, indeed if there is a lot of time between the points, of course can be a steeper channel as well). If we first get decreasing volatility and after the point 3 of the shallower channel a lot of increasing volitality again (comparable to before) then I use both channels, the original one and the shallower one.
Logically the original channel becomes a less steeper one (in case of decr volatility) which is nicely reflected by the new points used. If you draw the new shallower channel subsequent FTT's, VE's and all that are easier to see (just my opinion). It just helps to understand the market. Your conclusion may be for example that pace slowed down but there's no reason to change your long position. That's very valuable.
Also I consider a BO of the shallower channel reliable. After all we already broke out of the steeper channel. Often we find price will respect (at least for a while) the less steeper RTL. So if you draw this channel you know we have one more BO to go after the 1st one or at least you can expect the usual issues there at the RTL which you cannot if you didn't draw it.
Anyway, changes in channel steepness are just the results of changes in volatility. It does not have to imply a change in direction (short vs long) but it's good to understand what's happening.
regards,
Ivo
Especially consider using the old point 3 as a new point 1 if you notice a big change in volatility. (usually a drop, indeed if there is a lot of time between the points, of course can be a steeper channel as well). If we first get decreasing volatility and after the point 3 of the shallower channel a lot of increasing volitality again (comparable to before) then I use both channels, the original one and the shallower one.
Logically the original channel becomes a less steeper one (in case of decr volatility) which is nicely reflected by the new points used. If you draw the new shallower channel subsequent FTT's, VE's and all that are easier to see (just my opinion). It just helps to understand the market. Your conclusion may be for example that pace slowed down but there's no reason to change your long position. That's very valuable.
Also I consider a BO of the shallower channel reliable. After all we already broke out of the steeper channel. Often we find price will respect (at least for a while) the less steeper RTL. So if you draw this channel you know we have one more BO to go after the 1st one or at least you can expect the usual issues there at the RTL which you cannot if you didn't draw it.
Anyway, changes in channel steepness are just the results of changes in volatility. It does not have to imply a change in direction (short vs long) but it's good to understand what's happening.
regards,
Ivo
Quote from LostTrader:
It depends
Basically, try to choose an appropriate p1 to go with the new p3, that produces the channel corresponding to the current market direction which you see at the time, be it shallower or steeper. The Gaussians will eventually let you know if there's another better choice.