Spydertrader's Jack Hershey Futures Trading Journal

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I would like to visually demonstrate my last post.

Attached are 3 charts of Morning Up channels followed by a 2 bar lateral move on lower volume. The lateral may be on green or red volume and in either case the volume is decreasing. The color of the volume bar is irrelevant since the difference between red and green is 1 tic ( .25 pts ). The heavy lines are carryover lines from the previous day.

Can you tell from the charts when a lateral is signalling change or continuation?

For the answers please see my next posting.
 

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Quote from 8833broc:

I would like to visually demonstrate my last post.

Attached are 3 charts of Morning Up channels followed by a 2 bar lateral move on lower volume. The lateral may be on green or red volume and in either case the volume is decreasing. The color of the volume bar is irrelevant since the difference between red and green is 1 tic ( .25 pts ). The heavy lines are carryover lines from the previous day.

Can you tell from the charts when a lateral is signalling change or continuation?

For the answers please see my next posting.
More...

Hey broc...

The first example looks like a dip. It is also hard to anticipate change for me when the LTL is so far away from price action. The last 2 or 3 up moves in your channel made it about halfway to your LTL. I find it helpful to reel those lines in when price isnt making it up there. Perhaps someone more knowledgable can clarify that sequence, it is confusing no doubt

In the second and third, change is very evident to me in both circumstances. The second one is a slight retrace attempt followed by an FTT. Third is a DT followed by decreasing red back to the RTL (of a steeper channel not drawn in).

My analysis could be way off, but atleast it does put me on the right side of the market. There may well be flaws present in all 3 of those examples, but I do not have a firm grasp on those yet. I am having trouble understanding how/why you view those 2 bar formations as laterals? This was not intended to provide any clarification for you, as I am a bit too far down the rabbit hole for my mileage. Just thought I'd throw out my view on things, thanks for posting the example..

J
 
Quote from 8833broc:

I would like to visually demonstrate my last post.
More...

Your last post was about determining context and identifying what is happening on declining volume, mid channel?

The example charts you posted were interesting. I don't think you can determine what is coming up more than one or two bars out from a static snapshot. I think you need to tighten up your channels and add the lightweight tape channels too. This helps you with context. In your third example, I was leaning towards continuation on the basis that we had not seen a FTT following the one VolEx you show. However, if you put in the steeper channel you will see you had about 3 VolExs - so time for a change on that fractal! As always, what you actually decide to do may change as new data comes in.

Thanks for posting them - the "what happens next" exercises are very cool for learning but they have to be carefully chosen to drive the message home correctly.
 
POINTONE

"Your last post was about determining context and identifying what is happening on declining volume, mid channel?"

I am trying to make several points with these charts.

Point 1 - You don't know if you are mid channel or end of channel
till after the channel comes to and end. Correct ?

Point 2 - declining dominant volume in an up channel can mean several
things - a lateral, a start of a new trend with or without
a FTT or several varieties of flaws.

Point 3 - The system requires constant monitoring. MOST IMPORTANT.

I do not have the answers. I am just someone scratching away at this system hoping to get some feedback that may sink in.

Another question I would like to ask any of the successful traders is:

Using only the charts above ( ES price and Volume ) are these lateral
moves that I circled tradeable profitably or is it a crap shoot ?
 
Quote from 8833broc:

Point 1 - You don't know if you are mid channel or end of channel till after the channel comes to and end. Correct ?
More...

Incorrect. You know where you are at all times. Certainly everyone has the ability to determine where Price sits between a RTL and an LTL.

Quote from 8833broc:

Point 2 - declining dominant volume in an up channel can mean several things - a lateral, a start of a new trend with or without a FTT or several varieties of flaws.
More...

A significant difference exists between the words "can mean several things," and "does mean several things."

1. You've chosen to only look at Volume as differentiation between bars. This is simply not the way things work.

2. Your analysis fails to take into account the context of the NOW. When context changes, the answer to the question, "What must come next?" also changes

Quote from 8833broc:

Point 3 - The system requires constant monitoring. MOST IMPORTANT.
More...

The amount of 'monitoring' the system requires (after the learning phase) depends solely upon one's resolution level.
Quote from 8833broc:

Using only the charts above ( ES price and Volume ) are these lateral moves that I circled tradeable profitably or is it a crap shoot ?
More...

Not all the charts posted represent lateral Price Movement. I don't mean to say one couldn't decide they had a lateral channel there, and as a result, draw in a sideways channel. I mean to say, you've chosen the Price action and fit the chart into a box. I encourage you to begin to view things from a different perspective, and perhaps then, you can locate the answers you seek as a result of your newfound perspective.

- Spydertrader
 
8833broc,

In a nutshell, what I observe you doing with your most recent posts is trying to predict what is going to happen. I don't mean that as an insult, as I've been guilty of that very thing.

Repeatedly asking the questions "What do I need to see for continuation?" and "What do I need to see for change?" and then looking for those answers is very helpful in breaking out of a prediction mode.

-Au
 
Quote from 8833broc:

Point 1 - You don't know if you are mid channel or end of channel
till after the channel comes to and end. Correct ?
More...

I think I know what you're saying here: until the BO occurs (following the FTT) you do not know if the channel is over. The channel is not over until price leaves it, by crossing the TL.

Channels overlap.
 
The middle of the day was tough even for just annotating and monitoring. I probably go on for quite a while discussing this time period. The other areas that I had difficulty are labeled #1, #2 and #3.

#1 Confused me because it seemed we had an Even Harmonic formation that wud continue the up move, but no cigar.

#2 I thought was an FTT for a while given pretty high volume and the YM's Price action.

#3 Is another Even Harmonic formation that did continue the trend, but had a head fake down move first.

Well thats the way I saw it. :)

As always comments wanted and welcomed.
 

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