On 10-case geometry and beyond

[Sprout]

If we start with the beginning of the bar it's the Open. There are several possibilities. These are some main ones for this context:

View attachment 175378

a) High volume BO in-line with higher black volume in trend, could go long though still early in bar (aggressive).
b) High volume above previous close, but no BO yet, wait for confirmation.
c) High volume but still inside OB, wait.
d) High volume BO below OB, anticipate Change or at least long not interesting any longer.
e) High volume BO below RTL, strongly anticipate Change and start considering reversal.
f) Low volume BO. Less attractive than a) but could still go long, expecting some continuation (aggressive / chasing the market).
g) No BO yet, wait.
h) No BO yet, wait.
i) BO below OB on low volume, anticipate short-term limited upside.
j) BO below RTL on low volume, anticipate FBO or BO and forget longs for a while.

Of these, none are particularly interesting at Open since we should wait for more data, but if aggressive (ie. high quality pick) could go long in a) or f).

I think this should cover Open. Interesting cases to look further at is a) - c) and f) - h). They can each have High First or Low First, so will be at least 12 more cases, maybe more. d), e), i) and j) may be pruned out of further long-analysis.

If this helps, I can continue with the interesting cases and High First or Low First, or if you have concrete suggestions I can attempt to incorporate them, though I'm not exactly sure how to now.


EDIT: Maybe b) and c) can be merged together, as well as g) and h) as they're very similar?

Also, maybe d)-e) and i)-j) not too bad depending on further price development, according to possible new channel forming, so shouldn't be pruned after all? Seems to be many possibilities.

View attachment 175380

Good. You are reading the market.

The second attachment in the enclosed quote is the chart that you continue to build upon. Build on your annotations. Post a bar by bar log.
As Bars fill in, add annotations and log the bar. Each bar is a feedback cycle of learning. Logging each bar builds capacity.

Do the same for the next timescale up.

Same for the next timescale down.

We are creating a goldilocks zone. Aware of a larger context as well as a smaller.

We are then looking for the common thrusts of Dominance as well as the turning points in trend.

These are the areas of convergence, nodal points.

 

[Simples]

Good. You are reading the market.

The second attachment in the enclosed quote is the chart that you continue to build upon. Build on your annotations. Post a bar by bar log.
As Bars fill in, add annotations and log the bar. Each bar is a feedback cycle of learning. Logging each bar builds capacity.

Do the same for the next timescale up.

Same for the next timescale down.

We are creating a goldilocks zone. Aware of a larger context as well as a smaller.

We are then looking for the common thrusts of Dominance as well as the turning points in trend.

These are the areas of convergence, nodal points.

This is a bit curious, I thought volume bars were painted according to close-open, but it seems to be close.0-close.1 in BigCharts-charts (please see last bar 11 Jul):

We're only interested in close-open volume colour right?

Updated EOD chart according to yesterday's action. PA action around fast TL on low volume today it seems.

I'm working on getting annotation working in NT as using screenshots gets to be too limited with scaling issues and lack of options / usability. Though I see doing it manually may provide deeper insight, it'll currently take up too much time and effort to annotate and draw all this manually, and am getting curious what can be made to annotate this in trading software and hopefully provide more flexibility for new data and changing views.

 

[Sprout]

This is a bit curious, I thought volume bars were painted according to close-open, but it seems to be close.0-close.1 in BigCharts-charts (please see last bar 11 Jul):

View attachment 175458

We're only interested in close-open volume colour right?

Updated EOD chart according to yesterday's action. PA action around fast TL on low volume today it seems.

View attachment 175460
I'm working on getting annotation working in NT as using screenshots gets to be too limited with scaling issues and lack of options / usability. Though I see doing it manually may provide deeper insight, it'll currently take up too much time and effort to annotate and draw all this manually, and am getting curious what can be made to annotate this in trading software and hopefully provide more flexibility for new data and changing views.

Bar colors are preference controlled. Either keyed to the open and close of current bar or close vs close of b.1 and b.0

We are looking at open and close of current bar.

Otherwise we would have to dig into de-gapping, mentally or with software. Which is more of an advanced topic.

Manual annotations are the quickest way to mastery. Until one gets to unconscious competence.
Programming has it's own process of creating clarity and time-saving.
It's a personal decision open to revisiting if ever one gets stuck.

However atm, it's a short-circuiting process that trips up many a well-intentioned trader. One's programming will follow the constructs of one's mind.

Since you are in the EOD timescale, you've already created the necessary context to inform on this timescale and the faster one below it.

Do the same on the next greater Timescale , that is the next one to annotate.

Once you have your annotated charts, it's a very quick process to update one of them EOD. The other on weekends. You could skip the faster fractal for now. It would be more applicable to calibrating timing of entry's and exits intraday.

As you see, yesterday's bar filled in between the bounds that we set from the day before.

The annotations of b2b2r2b and r2r2b2r need some rework. First just look for the b2b's and r2r's. They are at the beginning of every trend. It looks like a trough coming from the prior bar and then an increasing Dominant Volume bar. This is the move from pt1 to pt2 of the pattern.

Decr B to Incr B to Decr R to Incr B

similar logic for r2r.

 

[Simples]

Bar colors are preference controlled. Either keyed to the open and close of current bar or close vs close of b.1 and b.0

We are looking at open and close of current bar.

Unfortunately Big Charts offer just "Volume+" among other indicators such as RSI/Stoch/..., so no parameters for their coloured volume indicator. They only provide just a simple web service, so get limited fast over time it seems.

Otherwise we would have to dig into de-gapping, mentally or with software. Which is more of an advanced topic.

Yea, I understand the principle and very good to keep it simple.

Manual annotations are the quickest way to mastery. Until one gets to unconscious competence.
Programming has it's own process of creating clarity and time-saving.
It's a personal decision open to revisiting if ever one gets stuck.

Cool. I'm inspired so just need to do it and see where it leads.

However atm, it's a short-circuiting process that trips up many a well-intentioned trader. One's programming will follow the constructs of one's mind.

Since you are in the EOD timescale, you've already created the necessary context to inform on this timescale and the faster one below it.

Do the same on the next greater Timescale , that is the next one to annotate.

Once you have your annotated charts, it's a very quick process to update one of them EOD. The other on weekends. You could skip the faster fractal for now. It would be more applicable to calibrating timing of entry's and exits intraday.

As you see, yesterday's bar filled in between the bounds that we set from the day before.

The annotations of b2b2r2b and r2r2b2r need some rework. First just look for the b2b's and r2r's. They are at the beginning of every trend. It looks like a trough coming from the prior bar and then an increasing Dominant Volume bar. This is the move from pt1 to pt2 of the pattern.

Decr B to Incr B to Decr R to Incr B

similar logic for r2r.

Yes, I certainly notice the difference, two very different operations of mind. While doing everything manually using a drawing program, I noticed certain limitations, lack of flexibility and filtering that I'd like to see if I can amend though.

Please look at GOOG EOD-chart and see if this helps readability. It's all 100% What We Know That We Know and a purely visual aid. The price bar "glow" indicate rising volume, as well as volume bars separating both rising/declining volume and rising/declining price (proper Close - Open volume colour). Otherwise, attempting to keep clutter to minimum ("less is more").

I'll review the patterns as well, although maybe it's possible to use the new charts going further after that? I believe it'll be a more practical approach due to time constraints on my part. It'll also provide some of the power of trading software, so hopefully less time trying to workaround limitations (scaling issues, re-using annotations, etc.). Can do any US stocks, ie. through Kinetick. Easier to analyse US data since NT won't allow generic imports of data.

I do have my reasons why the annotation is a bit different. Please keep mind open
In many respects this is a bit of evolution from the painted screenshots we've been working on. If the picture is too large/wide, I can make it smaller or maybe zooming (clicking image in ET) will help.

 

[svrz]

Use the excellent channel tool provided by Pepe to facilitate the drawing of your tapes and channels:

https://www.elitetrader.com/et/thre...ck-hershey-methods.97684/page-84#post-2154222

 

[beerntrading]

Wow...this is about the best charting thread I've come across. It's very similar to my candlesticking--to the extent that I didn't even have to read the posts to understand the first chart and those 5x5 grids of patterns. I'll have to give this a careful read when I get the time.

Time to follow two more users!

 

[Simples]

Use the excellent channel tool provided by Pepe to facilitate the drawing of your tapes and channels:

https://www.elitetrader.com/et/thre...ck-hershey-methods.97684/page-84#post-2154222

Not compiling properly under latest NT7 patch (7.0.1000.35), though can and should paint traverses and channels manually for now. Would be nice with something that persists annotations to disk later though.

 

[svrz]

I have the same version and I see no problems. What error are you seeing?

 

[Simples]

As you see, yesterday's bar filled in between the bounds that we set from the day before.

The annotations of b2b2r2b and r2r2b2r need some rework. First just look for the b2b's and r2r's. They are at the beginning of every trend. It looks like a trough coming from the prior bar and then an increasing Dominant Volume bar. This is the move from pt1 to pt2 of the pattern.

Decr B to Incr B to Decr R to Incr B

similar logic for r2r.

Here's updates to the original chart:

Tapes makes traverses, makes channels, but seems traverses and channels may sometimes merge (big Channel P2)?

Angle from Big Channel P1 keeps flatting out (Big Channel P1 to its P2, P3 to latest OB (Short to Extend).

Price currently inside Latteral with downward PA and volume so far.

 

[Sprout]

Here's updates to the original chart:

View attachment 175493
Tapes makes traverses, makes channels, but seems traverses and channels may sometimes merge (big Channel P2)?

Angle from Big Channel P1 keeps flatting out (Big Channel P1 to its P2, P3 to latest OB (Short to Extend).

Price currently inside Latteral with downward PA and volume so far.

Yes. We are observing the decreasing of pace which occur in all uninterrupted trends. By identifying Dominant and non-Dominant traverses, and return to dominance as pace changes, the trading zones of high and low risk come into view.

Risk management is defined and applied differently in shorter timeframes.
Moves with increasing pace = decreased risk.

We observe the first indication of retracement to reversal from prior trend with increasing pace of volume in the opposite price direction. This will happen as price clears the RTL of the green channel.

However to stimulate business, it's better to appeal to as many participants as possible. Price will frequently fill in the larger Sym pennant defined by the long and short channel.

It will not do this if a surge of Dominant Volume comes before the leading edge of the the Sym.

We know this because we will see a XO of either of our (short and long) RTL's as a move becomes a successful BO or instead we log a FBO.

If one is one thing it is not the other. The market operates on negative logic. We build on what we know by observing what we see is not.

In other words, as we test our possible scenarios, we get a true or false. As we collect falses, we end up with what it can only be - the truth.

Yet our context always holds multiple possibilities.

The field of anticipation is much larger than the field of prediction. One is expansive the other contractive.