Question regarding PA

[PAAddict]

Do you know the difference between tapes, traverses and channels? Your illustration shows a short traverse fanning into two larger short channels with incomplete long annotations.

Ok, I gave it a try. Here is my first annotated chart:

 

[PAAddict]

You're welcome. That is a very good thread.

Perhaps you can help me understand this:

"The path to determing what something is or is not resides in the Volume Pane."
Spydertrader

This was said regarding the definition of a movement as a Tape vs a traverse.

 

[Sprout]

Perhaps you can help me understand this:

"The path to determing what something is or is not resides in the Volume Pane."
Spydertrader

This was said regarding the definition of a movement as a Tape vs a traverse.

If you look at the price cases, you see a set that all price movement can be distilled into - the current bar and the bar before.

Out of the ten price cases, two make money, one makes money in two directions, four don't make money, two are frequent signals of change.

By connecting the highs and lows of two bar combinations via parallel lines, one starts to build a tape. This oscillating action of the tape can be bound by a larger set of parallel lines. This is known as a traverse. A traverse itself interlocks with a traverse in the opposite direction. Two traverses give the pt1, pt2 and pt3 to build a channel. Channels themselves can be traverses of even larger channels.

Attempt to draw the tapes and traverses on your chart and repost. Also, show bar numbers or timestamp to make it easier to discuss a specific bar.

You might want to consider going to the 5min. It'll be easier to see the 1min's price action traveling within the guardrails set by the bounds of the 5min bar. This is also true of the bounds of the 30min set the trendlines that the 5min flows into. It flows, until it doesn't. One can know a thing by knowing what it is not.

The larger timescales always bound the price action of the faster timeframes until they don't. Every long term trend started as a two-bar combination.

 

[Sprout]

Perhaps you can help me understand this:

"The path to determing what something is or is not resides in the Volume Pane."
Spydertrader

This was said regarding the definition of a movement as a Tape vs a traverse.

With volume the first thing to differentiate is what is considered Dominant and non-Dominant. Both exist at the same time but only one is in the forefront of perception.

To make money, price has to change. When price does change, it either happened on more or less volume. Price change on increasing volume is a characteristic of Dominance. Price change on decreasing volume is a characteristic of non-Dominance.

A trend is defined as a Dominant move, non-Dominant move and a return to Dominance. This oscillation repeats until it doesn't. When it doesn't, that is a signal for change. The signal that can be discerned on all tapes, traverses, channels, etc is the FTT - the failure to traverse.

The FTT is also the point 1 of the new opposite tape/traverse/channel coming into view. It exists not necessarily coupled on all timescales but more accurately the role it holds in the market's system of operation order of events (OOE).

The market is symmetrical, everything that applies to longs applies to shorts.

 

[Sprout]

Ok, I gave it a try. Here is my first annotated chart:View attachment 179090

Suspending the up and down bar color is useful. In looking at the form of the bars, one can discern when the form is in coherence with the bar color or not. Sometimes, this simple distinction is the signal for change.

OB's are good to notice, having the bar's open and close will differentiate the OB's for some are not like the others.

The lateral is good to notice. When price enters a lateral is behaves differently then when being marked up or marked down. It's a good zone to slalom as an advanced expert but is known to chop up those unawares.

If you take the time to draw the price cases out for yourself and post, it will support the effort in committing them to long-term memory and begins to build capacity.

 

[PAAddict]

If you take the time to draw the price cases out for yourself and post, it will support the effort in committing them to long-term memory and begins to build capacity.

Thank you, this method has provided great clarity in the bar to bar observation, something I lacked.

Here is a new attempt to comment a chart, the timestamp is included, I got lost regarding 1,2,3 when the trend accelerated after 10:05.

The other thing I am having great issues with is the volume pattern, not sure what is it I am looking for.

I am providing a colored chart, perhaps it will be easy to spot it here?

 

[Sprout]

Thank you, this method has provided great clarity in the bar to bar observation, something I lacked.

Here is a new attempt to comment a chart, the timestamp is included, I got lost regarding 1,2,3 when the trend accelerated after 10:05.
View attachment 179147

Your welcome, good on you for engaging in work.

Before the open there was an established trend defined by the parallel channel lines. The 6:25 bar had increasing volume before it's previous bar. Since it has equal lows and a HH it is a StB/StL (stitch black/ stitch long). It had increasing price with increasing volume - this is Dominance.

Starting with the 6:30 bar on the first chart. The 6:30 bar's low penetrated and closed below the RTL. This occurred on increasing volume compared to the previous bar. This bar is defined as an XR - a translation short. The form is always XR because it has a LH and LL compared to the previous bar regardless of color. Stripping away color although inaccurate now, will support further differentiation when one takes into account the bar color when presented with a non-coherent form.

The volatility of the 9:05 bar created a lateral when the successive 2 bars H's and L's were contained within the 9:05 H and L. Price action within a lateral behaves differently then when price is not contained by a lateral. The lateral defines a zone of probability. One probably gets chopped up unless skilled.

The 10:10 bar is the BO of the lateral. It remains a BO from having two closes outside the lateral boundary.

This bar had increasing volume with increasing price -> Dominance Long.

In contrast, bars 8:50, 9:05, 9:10, etc. have decreasing price with increasing volume -> Dominance Short.

You did a good job with drawing traverses and channels but the chart doesn't have any tapes drawn. If you use a light gray line it'll look like pencils lines and fade from view when not necessary. However, if you don't become rigorous with tapes, it causes problems later from fractal jumping. Tapes just connect the H's and L's of successive bars. Sometimes they are referred to as BBT's (building block tapes).

Drawing tapes will help clear up the area of confusion.

One of the things to notice is the slope of the RTL as you draw different channels as they come into view. The slope of the RTL points to the idea of volume pace which is a fundamental distinction. As price can break the RTL, it can also break the LTL. This is known as a VE. (volatility expansion). It serves the function of expanding a channel to create a larger trading range.



The other thing I am having great issues with is the volume pattern, not sure what is it I am looking for.

I am providing a colored chart, perhaps it will be easy to spot it here?
View attachment 179148

Start with finding Dominance. Any bar that has increasing volume relative to the bar before is a sign of Dominance. With this chart, by drawing a small colored arrow above the volume bar histogram with the same color as the bar. It'll help if you use black for long (incr price) bars and red for short (decr price) bars to understand the convention that's used.

Comments within quoted text.

 

[xioxxio]

If you want to take this journey, find the tools that are applicable to your software package. The coding is more sophisticated to an up bar being black and down bar red.

Reach out to stepan7 he has the ninjatrader toolkit.

 

[PAAddict]

Comments within quoted text.

Hi Sprout, I have been away on vacation, but thanks for your comments, while I get back I would like to have time to read the theory behind all of this, can you help me with a link to where I can find it?

 

[PAAddict]

If you want to take this journey, find the tools that are applicable to your software package. The coding is more sophisticated to an up bar being black and down bar red.

Reach out to stepan7 he has the ninjatrader toolkit.

Thanks I will do that