Iterative Refinement

Quote from treeline:

One way to interpret it is that it moved up on IBV (higher high, higher low, higher close). From this viewpoint, the Jokari Window says continuation up.

However, the bar closed in Lateral Movement. The Jokari Window says nothing explicit about Lateral Movement, but I've learned that an IBGS here on IBV could be interpreted as IRV for purposes of analysis using Jokari. Furthermore, I believe it is correct to use similar analysis when interpreting Spike Bars through the Jokari lens. In other words, a Spike Bar on IBV, with a close above the open, can still be viewed as having IRV for Jokari analysis since the latter part of the bar was moving down on increasing Volume.

From your hint, I am now thinking that the bar with the green "FTT?" label can be analyzed similarly to an IBGS or a Spike Bar in terms of the Jokari Window. If this is true, then we have IRV (2 ticks worth :eek: ) late in the bar. The Jokari Window says that decreasing Price on increasing Volume indicates continuation down.
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I kept thinking about the green "FTT?" bar while I was out of town for the weekend, because I'm having a difficult time seeing it as Jokari Window continuation down. In my analysis above, I was trying to "set aside what I think I know," which is that a bar with a higher high, higher low, and higher close on IBV signals continuation up unless it's a Spike Bar. Since this particular bar closed only 2 ticks below its high, it doesn't qualify as a Spike Bar. But due to its close in LM, I was trying to analyze it similarly to a Spike Bar or a Pennant FBO on IBV.

I reannotated the same area this morning, and this time I set aside something else that I think I know. As we've discussed, a BO of a lateral requires increasing volume on one bar followed by more increasing volume on the next bar. I remember an example when Spydertrader pointed out that the first bar of increasing Volume doesn't have to be the breakout bar; it can be the bar before the breakout bar (i.e., the bar is heading towards a BO on increasing Volume but stays within the lateral). Then the next bar breaks out of the lateral on more increasing Volume, confirming a change of trend. Unfortunately I'm having trouble locating this example, so I may be misremembering or I may have misinterpreted his post the first time around.

I'm also setting aside something else that I think I know, which is that Point 3 must be accompanied by increasing Volume on or after the Point 3 bar. In the olive Traverse, we don't have IBV on or after Point 3. But the FTT is an OB on IRV, and we can view it as having IBV early in the bar before it became an OB. Also, I have seen at least one other example by Spydertrader when P3 was not followed by increasing Volume.

P.S. The "green FTT?" bar referred to above is the 10:25 (close of) bar. I removed the FTT? label in the chart below since the FTT moved over to the 11:05 bar.
 

Attachments

08-07-08 10:38 PM



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Quote from romanus:

The reference to lack of increasing volume after lateral (or formation) BO always meant to be used to determine whether or not the trend has changed. In other words the break out has to be in the direction opposite to the trend. If you still convinced that Guavaman's comment with that respect has any validity, try finding an example of the traverse which ended because of that particular Traverse level change 'signal'. I did and I failed. Every time one sees a change after lateral BO with failure to show increased volume it is because there's some other signal present that does the job or there's no traverse end point.


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RETRACTION: I was wrong about that. Apology for the unintended confusion.

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Hi romanus,

Would you mind clarifying your current understanding of when a lack of more increasing Volume after a lateral BO indicates a change of trend? In other words, what part were you wrong about?
 
Quote from treeline:

08-07-08 10:38 PM



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Quote from romanus:

The reference to lack of increasing volume after lateral (or formation) BO always meant to be used to determine whether or not the trend has changed. In other words the break out has to be in the direction opposite to the trend. If you still convinced that Guavaman's comment with that respect has any validity, try finding an example of the traverse which ended because of that particular Traverse level change 'signal'. I did and I failed. Every time one sees a change after lateral BO with failure to show increased volume it is because there's some other signal present that does the job or there's no traverse end point.


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RETRACTION: I was wrong about that. Apology for the unintended confusion.

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Hi romanus,

Would you mind clarifying your current understanding of when a lack of more increasing Volume after a lateral BO indicates a change of trend? In other words, what part were you wrong about?
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Pennant/Formation/Lateral Movement BO on increased volume with failure to show more increased volume on the next bar represents a change signal.

Quote from Spydertrader:

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A Failure to Traverse represents a signal for change at a specific point in time. In other words, while Price fails to reach the LTL, this isn't the only requirement for an FTT. It also needs a signal for change. Otherwise, you'd see every bar which fails to reach the LTL as a FTT.
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http://www.elitetrader.com/vb/showthread.php?s=&postid=2016013#post2016013

I went through a numerous charts (where Spydertrader annotated FTT's) and from what I see, every FTT bar is also a change signal (one of the traverse level change signals from the 'sesame street' three's of three post:D )

P.S. Olive traverse: the Outside Bar was increasing black at some point. As I watched that traverse unfold in real time I thought: OK now we have increasing black to confirm fanned out traverse, then that bar turned around and became OB, and I said to myself - BOOM, Jokari window change - this traverse is over.

My thought process may not be correct as evident by my earlier adventures with analysis.
 
Quote from romanus:

I went through a numerous charts (where Spydertrader annotated FTT's) and from what I see, every FTT bar is also a change signal
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To be more clear, I was looking to see what change signals those FTT represented when they were not Jokari Window change signals. Excluding those I was familiar with - Formation/Lateral FBO's and Peak Volume, I arrived at the conclusion, by process of elimination, that since remainder of FTT's (other than Jokari, Peak Volume and Formation/Lateral FBO's) looked like they were BO' on increased volume with no more increased volume followed - then it must be a change signal.

There's also a small group of FTT's that I have not figured out what signal they represent.

:D So something else may be out there.
 
Quote from Mr_Black:

When it seems that market jumps cells on lower level it means developing cell on higher level or price is still in higher level cell:D
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Simple and elegant at the same time.:) Thank you Mr_Black for your efforts.
 
Quote from ljyoung:

Message received. Correction made. There were 2 bars of increasing volume they happened to be RED not black (Doh!!) and hence your FTT, etc. Thank you Spyder. I can now return to the garden and deal with our friend.

lj
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Ljyoung, could you elaborate a little bit on the corrections. I still can not understand why going short on the OB labeled FTT is an incorrect action?

PS: Spydertrader, did I interpret your response the wrong way?

]<img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=2023288
 
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