Iterative Refinement
- Thread starter Spydertrader
- Start date
In the first example, it's the location of the 11:15 that is the difference. Because it broke out down it only killed the lateral within the lateral. If this internal lateral was located at the bottom of the larger one it would have killed it. Or if the BO had been to the upside. I don't believe an outside bar has any relevance. The step up in pace should be good enough. See the first set of chart clips attached.
The 13:30 is a little more curious because of the other example posted for comparison. They look to be a similar situation, just flip flopped with one at the top of a lateral and one at the bottom. They both are an IBGS by one tick, and seem to have enough of a step up in pace for a sentiment change (though the 13:30 is in the same pace level). The location in the channel is different as the 1st one is near the LTL and the other is a making a point 3. Aside from that difference, it's what happens next. In the first clip, 3 bars later, there is a return to dominant volume in the previous direction - cont up. In the second clip, 3 bars later we get confirmation of the point 3 and change to up.
So there was never any confirmation of change in sentiment and direction of the 13:30 bar. And the 13:30's volume went up, but didn't really step up in pace.
That's my take.
Regards - EZ
For the past 38 days I have literally (almost 24/7 at times) devoted myself to studying, coming to an understanding and applying these aspects of SCT. This was done in real time with annotations and sweeping this data from these applications. I wanted to provide this list to refresh these ideas and for those who may be wondering what SCT is all about.
Also if I have left anything out please add to my list. Of course I realize that trading Equities requires other information and I have studied those aspects as well. My focus at this time is on trading futures. I plan on contributing more in the future as time permits. Feel free to correct any errors or anything stated incorrectly.
How the fractal is created. Know how to identify point 1, 2, or 3 of the fractal and how to draw the Channels properly. (Annotations)
Volume/Gaussian Distributions-Understand their shifts-B2B or R2R.
PRV - Pro Rated Volumes or what is commonly referred to as Pace Volumes
FRV-First Rising Volume
FTT-Fail to Traverse
FBO-Fail to Break Out
BO-Break Out
Tapes - Channels
Traverses
Dominant
Non-Dominant
DU â Dry Up Volume
Retrace
Jokari Window apps (there are many)
Continuance
Change
Price Increase
Price Decrease
RTL- Right Trend Line
Right to Left Mode
LTL âLeft Trend Line
LTR-Left to Right
OB â Outside Bar
Symmetrical Pennants (SYM)
Laterals
Flat Bottom Pennants (FBP)
Flat Top Pennants (FTP)
Stall
High Volatility Stall (HVS)
Dip
Hitch
CCC
Uniqueness of Fast Stochastic 5.3,2
Slow Stochastic 14, 3, 1
MACD 5,13,6 (histogram and what .4/-.4 means)
Stretch and Squeeze - Offsets/Cash/Futures
Odd and Even Harmonics
Triangular Wave Formations
Square Wave Formations
IBGS-Intrabar Gaussian Shifts
Tic Chart
Depth of Market (DOM) apps
MADA â Monitor Analyze Decide Act
Also I think it's important to understand and reinforce what this information provides:
Context
The circumstances that form the setting for an event, statement, or idea in the terms of which can be fully understood and assessed.
The parts of something written, spoken, or derived that precede and immediately follow to clarify its meaning.
Enjoy your day
Also if I have left anything out please add to my list. Of course I realize that trading Equities requires other information and I have studied those aspects as well. My focus at this time is on trading futures. I plan on contributing more in the future as time permits. Feel free to correct any errors or anything stated incorrectly.
How the fractal is created. Know how to identify point 1, 2, or 3 of the fractal and how to draw the Channels properly. (Annotations)
Volume/Gaussian Distributions-Understand their shifts-B2B or R2R.
PRV - Pro Rated Volumes or what is commonly referred to as Pace Volumes
FRV-First Rising Volume
FTT-Fail to Traverse
FBO-Fail to Break Out
BO-Break Out
Tapes - Channels
Traverses
Dominant
Non-Dominant
DU â Dry Up Volume
Retrace
Jokari Window apps (there are many)
Continuance
Change
Price Increase
Price Decrease
RTL- Right Trend Line
Right to Left Mode
LTL âLeft Trend Line
LTR-Left to Right
OB â Outside Bar
Symmetrical Pennants (SYM)
Laterals
Flat Bottom Pennants (FBP)
Flat Top Pennants (FTP)
Stall
High Volatility Stall (HVS)
Dip
Hitch
CCC
Uniqueness of Fast Stochastic 5.3,2
Slow Stochastic 14, 3, 1
MACD 5,13,6 (histogram and what .4/-.4 means)
Stretch and Squeeze - Offsets/Cash/Futures
Odd and Even Harmonics
Triangular Wave Formations
Square Wave Formations
IBGS-Intrabar Gaussian Shifts
Tic Chart
Depth of Market (DOM) apps
MADA â Monitor Analyze Decide Act
Also I think it's important to understand and reinforce what this information provides:
Context
The circumstances that form the setting for an event, statement, or idea in the terms of which can be fully understood and assessed.
The parts of something written, spoken, or derived that precede and immediately follow to clarify its meaning.
Enjoy your day
Yup, there is a lot to this 
I'm new to this too but taking the advice posted earlier several times to not explore the medium and fine tools until a level of skill has been achieved at the coarse levels. For myself I don't think I would find it productive to look at the medium/finer tools (YM, DOM, STR/SQU) at this point so I am not analyzing them at all.
I'm trying to think big picture (coarse) at this point. One thing I do that seems to help is to occasionally reduce the height + width of the bars, to see 2-3 days at a time (again, I'm beginner level, not sure how useful this is at higher skill levels, but seems to help with context some days).
I'm new to this too but taking the advice posted earlier several times to not explore the medium and fine tools until a level of skill has been achieved at the coarse levels. For myself I don't think I would find it productive to look at the medium/finer tools (YM, DOM, STR/SQU) at this point so I am not analyzing them at all.
I'm trying to think big picture (coarse) at this point. One thing I do that seems to help is to occasionally reduce the height + width of the bars, to see 2-3 days at a time (again, I'm beginner level, not sure how useful this is at higher skill levels, but seems to help with context some days).
I'm a lot newer to this method than Interdim, but equally, hope to be able to make a positive contribution here in the future.
In the meantime, here's something that curious newcomers might find useful. It's a (much simplified) version of one of Jack's recent posts, crystallizing the entire method.
* * * * *
This is a template for profiting from any liquid market.
There are three hurdles:
The learning process
Through careful study, the steps of price/volume cycling are internalized.
The exposition is like a reading test. A reader may gain a basic level of comprehension, without achieving real understanding.
Learn to take what the market offers and a strategy evolves.
The science of trading is based on:
The trading strategy
There are seven cases for price trending (Fig 8).
There is a 4-part approach to trading:
Volume is the second independent variable. (see Fig 10) This is examined with the mind module. Operators determine the:
Fig 12, The Channel Formation Module, deals with drawing the channels. This lets us apply the P, V relationship. Also of note is the overlap relationship of channels, heralded by a Failure To Traverse (FTT).
The P, V module provides the remaining data. A defined number of data sets are monitored and analyzed in turn. This enables us to determine the market MODE (Continue or Change) as expressed by
FTT is important for market timing. Fig 14 shows what happens before and after a FTT. Because the market is cyclic it is possible to anticipate based upon what must come next: IBGS, inter-bar Gaussian (volume) shifts and flaws (WWT or What Wasnât That). Fig 15 shows the graphic regions that are assigned to these.
Figs 16-18 deal with the details of sequences and internal data arrays. This lets the trader anticipate for the next several bars and the potential price and volume value zones. It also explains why the market moves in an orderly fashion, eliminating choices then taking the one remaining path.
In the meantime, here's something that curious newcomers might find useful. It's a (much simplified) version of one of Jack's recent posts, crystallizing the entire method.
* * * * *
This is a template for profiting from any liquid market.
There are three hurdles:
- Acquisition of skills
- Effective use of skills
- Application of capital
- Learn to learn
- Know how the mind works
- Have a business plan
- Have a trading plan
The learning process
Through careful study, the steps of price/volume cycling are internalized.
The exposition is like a reading test. A reader may gain a basic level of comprehension, without achieving real understanding.
Learn to take what the market offers and a strategy evolves.
The science of trading is based on:
- How the market works
- How the market is observed
- How the trader operates
- How money is made
The trading strategy
There are seven cases for price trending (Fig 8).
There is a 4-part approach to trading:
- Monitoring
- Analysis
- Decision-making
- Action
- trends and sentiment
- a channel on three timeframes
- price volatility.
Volume is the second independent variable. (see Fig 10) This is examined with the mind module. Operators determine the:
- vector, surge or pause (demonstrated by change in speed)
- pace and change of pace
Fig 12, The Channel Formation Module, deals with drawing the channels. This lets us apply the P, V relationship. Also of note is the overlap relationship of channels, heralded by a Failure To Traverse (FTT).
The P, V module provides the remaining data. A defined number of data sets are monitored and analyzed in turn. This enables us to determine the market MODE (Continue or Change) as expressed by
- P, V relationship
- Internals detection
- A pace change override signal.
- Dominant - a traverse with a channel trend
- Non dominant - a traverse against the channel trend.
FTT is important for market timing. Fig 14 shows what happens before and after a FTT. Because the market is cyclic it is possible to anticipate based upon what must come next: IBGS, inter-bar Gaussian (volume) shifts and flaws (WWT or What Wasnât That). Fig 15 shows the graphic regions that are assigned to these.
Figs 16-18 deal with the details of sequences and internal data arrays. This lets the trader anticipate for the next several bars and the potential price and volume value zones. It also explains why the market moves in an orderly fashion, eliminating choices then taking the one remaining path.
A question for those who see clearly.
The attached snippet from 9-24-08 shows a black line with attached question mark pointing to a LM. I snipped off the following statement by Spyder: âA completed sequence followed by Lateral BO FBO followed by change in dominance from red to black. Sure looks like change to me.â which I will now attempt to deconstruct.
Spyder in a post to phineas j. w. http://www.elitetrader.com/vb/showthread.php?s=&threadid=113310&perpage=6&pagenumber=1308 clearly states that the 11:35 and 11:40 black bars are non-dominant, not dominant. Why would it have been thought that black was dominant here?
At the far left edge of the snippet there is a text box which says the green arrow points to a completed sequence. IMO it was at this point that it was perceived that the activities of the prior day had concluded here in the sense that the last dominant (red in this case) piece of the puzzle had been completed. The peak volume âgo longâ signal âconfirmedâ, if you will, the 1,2,3 TRAVERSE completion.
It is very clear that it did not because if it did then the 11:35 and 11:40 black bars would have been dominant and they are not. So what up? IMO the point 3 with the question mark does NOT complete the lateral (non-dominant) traverse from the prior day due to the fact that there was no further increasing red volume after the LM BO at 10:15. If this is correct then all the price action (and associated sequences) between that bar and the next annotated point 3 is IFM (intrafractal movement) â tradeable of course but not for a ES 5 min traverse trader.
So where is the âcritical point 3â, i.e., the point 3 which completes the 2-3 lateral traverse from 9-23 and which allows the traverse trader to look for a signal for change? IMO it is the point 3 with the exclamation point. However I have a question about this deduction.
Price breaks out of the FBP with two bars of increasing volume confirming the point 3 but then closes back inside the LM (the LM is indicated by the black line and a question mark). At this point Iâm thinking WTF. How can we have change here if there was no BO of the LM with two bars of increasing red volume? If we DONâT annotate a LM then as best I can tell, we donât have a signal for change (no JW, no peak volume, no BO FBO). I remember Spyder saying that sometimes a formation is annotated AFTER the fact.
So my question is whether this is one of those situations. If it is, then end of story but if it isnât, then what is going on here? The other question is why does the 11:35 bar tell you black is non-dominant? I can see why black is non-dominant using my logic but do not understand Spyderâs rationale here.
TIA
lj
The attached snippet from 9-24-08 shows a black line with attached question mark pointing to a LM. I snipped off the following statement by Spyder: âA completed sequence followed by Lateral BO FBO followed by change in dominance from red to black. Sure looks like change to me.â which I will now attempt to deconstruct.
Spyder in a post to phineas j. w. http://www.elitetrader.com/vb/showthread.php?s=&threadid=113310&perpage=6&pagenumber=1308 clearly states that the 11:35 and 11:40 black bars are non-dominant, not dominant. Why would it have been thought that black was dominant here?
At the far left edge of the snippet there is a text box which says the green arrow points to a completed sequence. IMO it was at this point that it was perceived that the activities of the prior day had concluded here in the sense that the last dominant (red in this case) piece of the puzzle had been completed. The peak volume âgo longâ signal âconfirmedâ, if you will, the 1,2,3 TRAVERSE completion.
It is very clear that it did not because if it did then the 11:35 and 11:40 black bars would have been dominant and they are not. So what up? IMO the point 3 with the question mark does NOT complete the lateral (non-dominant) traverse from the prior day due to the fact that there was no further increasing red volume after the LM BO at 10:15. If this is correct then all the price action (and associated sequences) between that bar and the next annotated point 3 is IFM (intrafractal movement) â tradeable of course but not for a ES 5 min traverse trader.
So where is the âcritical point 3â, i.e., the point 3 which completes the 2-3 lateral traverse from 9-23 and which allows the traverse trader to look for a signal for change? IMO it is the point 3 with the exclamation point. However I have a question about this deduction.
Price breaks out of the FBP with two bars of increasing volume confirming the point 3 but then closes back inside the LM (the LM is indicated by the black line and a question mark). At this point Iâm thinking WTF. How can we have change here if there was no BO of the LM with two bars of increasing red volume? If we DONâT annotate a LM then as best I can tell, we donât have a signal for change (no JW, no peak volume, no BO FBO). I remember Spyder saying that sometimes a formation is annotated AFTER the fact.
So my question is whether this is one of those situations. If it is, then end of story but if it isnât, then what is going on here? The other question is why does the 11:35 bar tell you black is non-dominant? I can see why black is non-dominant using my logic but do not understand Spyderâs rationale here.
TIA
lj
Ezzy,
My take on this situation is that the 13:15 bar, having just broken out to the upside of what was an very big and very long lateral retrace (10:00 to 13:10), was the first bar in the beginning of another lateral retrace of which the 13:30 bar ended up as just one of the bars that made up this left to right retrace since it opened and closed within the shadow of the :15 bar. Since the :15 bar didn't show a traverse level signal of change, I felt we were just moving laterally so the IF-1 or IBGS nature of the bar didn't indicate to me that we could expect change here.
I was kind of hoping that 1330 breaks the lateral - that would make the 1345 eob the first 'legitimate' increasing black volume in that traverse that comes after lateral retrace.
1250 eob - spike
1315 eob - SYM BO
1330 eob - spike
If one keeps that lateral - Where's The Black (which is not one of three cases)?
I don't know if I am applying the logic here correctly, but after lateral retrace is killed with two closes outside (1255 and 1300 eob, both decreasing black) the market is supposed to return to dominance in black, which means one has to see increasing black, which is not one of the three cases, before even contemplating permission to seek change in mode.
If one keeps the lateral which began with 1315 in place after IBGS (1330 eob) - it appears as if the black never became dominant again
I recommend you research the context and exact statement (providing a link as necessary) made by me, rather than, assume a certain accuracy, with respect to your own memory and / or understanding, which may, or may not actually exist.
- Spydertrader