Iterative Refinement

Quote from romanus:

If anybody could share their insight on 1450 [close of] bar, I would greatly appreciate that. It is an IBGS, which signals change. Since it closed within the previous bar range I am permitted to look at YM, which at 1450 [close of] shows retraces on decreased red volume following an FTT a bar earlier. And yet the price continues to traverse all the way to LTL.:confused:
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Did the YM close inside or outside the previous YM bar?

- Spydertrader
 
Quote from Spydertrader:

Did the YM close inside or outside the previous YM bar?

- Spydertrader
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Inside = lateral movement. :D Sound of slap on forehead :D

Thank you, Spydertrader.
 
Quote from romanus:

Sound of slap on forehead :D
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The actual signal for change occured one bar prior - [close of] the 14:45 bar when Price moved in the dominant direction on decreasing dominant Volume. At that same time, the YM had already signaled change. So when the ES [close of] 14:50 bar appeared to confirm the previous bar's signal for change, one then needs to go check the YM again.

Why?

The YM leads the ES.

Since the close of the last ES bar, the YM had already returned to increasing black and therefore, signaled a return to up as the dominant direction - once again.

And as you pointed out, the YM then showed lateral movement which in and of itself doesn't meet the sufficiency test, and therefore shows continuation.

- Spydertrader
 
Quote from astral:

Spydertrader, I have a question regarding the leading pairs and such. Would you mind me asking some about it.
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Not if you don't mind following convention.

- Spydertrader
 
Hey all,
I have done very well the past two weeks. Unfortunately, I have not been keeping a careful journal, so that is resolution 1. I need to understand what I am doing different the past two weeks. I am reading through the futures journal, and I think beginning to absorb what it means to know where you are to the right side of the market. I have a question about DU however.
As I am reviewing my trades over the past two weeks, I have noticed that I am using DU and FRV less and less as a rule, and more as a guideline. This is especially the case with stocks which have had low volume for a month or two. This has led to some very profitable trades. Instead, I am weighting more and more my analysis of the daily charts. I look to see where in the channel the equity is, and what the volume is telling me. For example, SOLF did not reach FRV before this weeks breakout, and though I exited out after making about 20% (I could have made 40 by this point), it was a solid win. However, it was increasing black volume over the previous day, it had just broken through the 20 SMA, and it was only halfway up its new steep channel.
There have been a few trades which have not worked out or been nominally profitable, but no real losers. The real losers come from not having examined the daily chart carefully AT ALL.

Anyway, I am wondering if this is the point of the DU and FRV rules. They are guidelines to an underlying theory that can be dug deeper into. Please correct me if I am wrong.

JF
 
Quote from Jesus_Freak:

Anyway, I am wondering if this is the point of the DU and FRV rules. They are guidelines to an underlying theory that can be dug deeper into.
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In case you missed it, this is an Aha! moment. :D

- Spydertrader
 
Just a quick check up of some basics, to make sure I am getting them.

FTT - This is when the price FAILS to move from the RTL (NOT the left) to the left. This is THE indicator of change. It is always followed by FBO, BO, or another FTT.

FBO - A Failed break out after an FTT. Results in two bars outside of trend, but then a reentry.

BO - Price breaks out of the trend, forming a new trend.

Rules so far for what to do after FTT
FTT - Reverse
BO - Hold
FBO - Exit (for me... a beginner)

As far as drawing channels... this is where I can get confused.
1) the new p1 occurs at the Ftt (I believe on the bar right before BO)
2) The new pt2 exists at the first high (or low, depending upon trend) followed by a decline.
3) The new pt3 is at the first low (or high, depending upong trend) followed by INCREASING volume in the reverse direction.

Please correct me if I am misunderstanding these basics. Thanks!

JF
 
Quote from Spydertrader:

In case you missed it, this is an Aha! moment. :D

- Spydertrader
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WOoHoo!! I was hoping one would happen EVENTUALLY. (It's been almost a year since my first trade).

JF

P.S. All due to the hard work of everyone before me!!!
THANK YOU! :)
 
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