Iterative Refinement

[ljyoung]

Quote from ivob:

Hi,

So you say a tape on increasing volume cannot be followed by a tape on increasing volume in the opposite direction?

I don't have to look back very much to see examples of this.

Just enter on point 1 and wait for point 3 blindly and you get killed big time. You need to monitor very well how the movement from point 2-->point 3 is.

Ivo

No ivo what I said was you can't get a REVERSAL till the 1,2,3 is done. What you have just described is a retrace. You do have to monitor the movement of P2 to P3 but you know you are going to make P3. Period. That is an incredibly powerful piece of information.
Now I will agree that how P3 is "made" in terms of the 'precise' bar conformations and sequences surrounding the third point will vary but you should know what these are and be waiting for one of them to show itself. What determines which one is context, the alluring outfit that Ms. Market wears (and that you probably bought for her with the money you gave to her for her clothing allowance- me too ivo. No shite.)
Hypothesis: If you draw a horizontal line across the chart with origin at P1, then P3 will always be north of it.
See you next week.

lj

 

[TIKITRADER]

MONTHLY ES U8 Chart as of August 8 2008

 

[ivob]

Quote from ljyoung:

No ivo what I said was you can't get a REVERSAL till the 1,2,3 is done. What you have just described is a retrace. You do have to monitor the movement of P2 to P3 but you know you are going to make P3. Period. That is an incredibly powerful piece of information.
...

A retrace on increasing volume?

Well, now picture the following not completely uncommon scenario.

First 2-3 bars of the day we go up on increasing volume.

Next bars price goes down on increasing red volume taking out the open and continuing down.

So where is the point three?

regards,
Ivo

 

[ehorn]

Quote from ivob:

A retrace on increasing volume?

Well, now picture the following not completely uncommon scenario.

First 2-3 bars of the day we go up on increasing volume.

Next bars price goes down on increasing red volume taking out the open and continuing down.

So where is the point three?

regards,
Ivo

Hi Ivo,

Not sure if this is a question or statement, but it is quite possible to form a retrace on increasing volume.

Your scenario is quite common. But what your are describing (assuming it is not HVS) is the market 'syncing' and seeking to establish the 1st dominant traverse for the day. So where is the PT3 you ask. It has yet to be established as price is currently moving from PT1-PT2 on the dominant traverse (down).

 

[nkhoi]

Quote from ivob:

..I even recall one skype chat in the beginning of this year where we were all expecting a point 3 down including you. What happened was increasing black bar after bar and new highs. I remember you saying literally: "These things just happen in the market"... I never forgot this.

Another quote I recall: "When you see increasing red, no need to be in the trade anymore". This involved an uptrend.

Anything can happen, the good thing is the market will show it.

regards,
Ivo

you forgot one variable, he's several months older now.

 

[Tums]

Quote from ivob:

...I even recall one skype chat...
regards,
Ivo

It is inappropriate to make quotes in this manner.
For the benefit of the readers, we should always attach chart, indicate reference time, and quote specific text.

There is context to everything; the readers should have access to those context.

 

[Spydertrader]

Quote from ivob:

Anything can happen, the good thing is the market will show it.

Once the market completes its sequences anything can happen - not until. How can you know? You can draw a Point Three channel in place before it fully forms can't you? Why do you think you have this ability? You've (at least your brain has) seen these things play out again, and again, and again - thousands of times. You simply haven't made the connection from one side of your brain to another. Need more proof? Think how many times you just knew the market had "gone far enough" when suddenly it turned. You didn't guess. You didn't hope. You knew. How can that be? Again, because you've seen it thousands of times already, but have yet to fully make the connection from one part of your brain to another.

'Anything can happen' is sort of like 'YM leads the ES' when it comes to how one interprets the meaning behind the words. YM leads the ES doesn't have the qualifier 'all the time' added to it, and neither does 'anything can happen' because until the market completes its sequences from Point One to Point Two to Point Three, anything can't happen.

Most people cannot envision a Universe where what I have said here is possible, let alone one where what I have described occurs without exception day after day, market after market, time frame after time frame, fractal after fractal.

This is not my interpretation of how things are. This is how all markets operate.

Read Jack's posts where he describes the market like reading music, skiing or surfing, or my posts with respect to learning to drive. These represent analogies which show 'something is there' and although not everyone has the ability yet to 'see' that which exists, anyone can develop this ability due to the underlying structure.

Again, most people can't believe in things they cannot see for themselves. How does Oxygen and Electricity fit into such a paradigm?

- Spydertrader

 

[icarus618]

Quote from ljyoung:

* * * You do have to monitor the movement of P2 to P3 but you know you are going to make P3. Period. That is an incredibly powerful piece of information. * * *
lj

You sure about this?

 

[ivob]

Quote from Tums:

It is inappropriate to make quotes in this manner.
For the benefit of the readers, we should always attach chart, indicate reference time, and quote specific text.

There is context to everything; the readers should have access to those context.

Come on. It was a live chat and you know I cannot attach chart or indicate a reference time.

All I am saying is that we can expect a point 3 up or down but it just doesn't happen even though the market gives you all reasons to believe it would happen.

That doesn't just happen to me, it also happened to Spydertrader. Believe it or not.

regards,
Ivo

 

[icarus618]

Quote from ivob:

* * *

All I am saying is that we can expect a point 3 up or down but it just doesn't happen even though the market gives you all reasons to believe it would happen.
* * *
regards,
Ivo

Congratulations! You have been initiated into the membership of the World Trading Federation (WTF).

Is the failure to p3 (fp3) the trading equivalent to the Lochness Monster???

Now this thread is getting interesting.