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Iterative Refinement
- Thread starter Spydertrader
- Start date
Quote from Spydertrader:
Why does this specific example tell you something different than the previous?
- Spydertrader
1st example:
As price travelled from the high to the low of 1150 [close of] bar , it did so on red volume;
1155 [close of] = price traveled lower on decreasing red volume, telling to anticipate change;
1200 [close of] the anticipated change took place as price broke the low of the previous bar and closed within the previous bar range indicating lateral movement, therefore the increased volume on this bar should be attributed to lateral movement.
So technically there was no down move on increased volume and these three bars should be considered as a retrace.
2nd example:
Lateral Formation BO on increased volume followed by more increased red volume on 1250 [close of] bar indicating that the up trend has changed
11:50 bar: without a VE (although 11:35 could be a flaw), price creates an IBGS and closes inside the range of the previous bar on decreasing volume. Price has failed to reach the LTL of the channel after a peaking volume bar and, based on the close, suggesting an ftt is potentially on the table. However, the steepness of the up channel provides the possibility that price still has room to go up. Depending on your resolution, you might be short, but Iâm not. However, still looking for decreasing red back to the RTL since the R2R Gaussian could appear.
11:55 bar: prices moves lower on decreasing red volume back toward the rtl. Confirming the ftt. Price closes within the shadow of the 11:45 bar signifying lateral movement.
12:00 bar: We get increasing red volume, but price fails to BO the channel and fails to close lower than the previous bar. Price also fails to move out of the lateral movement area on the increasing red volume. Still moving laterally.
11:55 bar: prices moves lower on decreasing red volume back toward the rtl. Confirming the ftt. Price closes within the shadow of the 11:45 bar signifying lateral movement.
12:00 bar: We get increasing red volume, but price fails to BO the channel and fails to close lower than the previous bar. Price also fails to move out of the lateral movement area on the increasing red volume. Still moving laterally.
Quote from romanus:
1st example: So technically there was no down move on increased volume and these three bars should be considered as a retrace.
2nd example:
Lateral Formation BO on increased volume followed by more increased red volume on 1250 [close of] bar indicating that the up trend has changed
And as a result, Example One did not form a Point Three Down Channel, whereas Example Two did.
Nicely done.
Subtle differences, yet all the difference in the world.
- Spydertrader
Quote from romanus:
2nd example:
Lateral Formation BO on increased volume followed by more increased red volume on 1250 [close of] bar indicating that the up trend has changed
After 1300 [close of] FBP FBO I expect to see decreasing black as price travels from pt2 to pt3. Instead increasing black PRV on 1305 [close of] bar and increasing black on 1302 YM (indicating that YM returned to dominant direction) tell me that what must come next did not, and signaling return to up trend?
edit: OR after forming pt3 down channel with increasing red on 1310 [close of], 1315 [close of] goes lower on decreased red volume telling me to anticipate change with 1320 [close of] confirming an FTT?