Spydertrader's Jack Hershey Futures Trading Journal
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I found the morning up move very easy to pick out. The sideways movement aftwerward was / is tough for me. Price seems to crawl to a stop and then makes sudden jerky moves that are hard to follow.
RT
The BCFBW (Building Channels for Building Wealth) document is, IMO, the bedrock of the JH methodology. As has been mentioned earlier, drawing channels is not the market grail BUT if the rules for doing same are not followed, then a collection of unique and often non-comparable "pictures" of what happened during the day is generated. For sure there may be differences of opinion about which channel should be drawn in such and such a way and not infrequently this is related to what is to the left (channel-wise) of where one is currently.
Another reason for non-comparability, is apparent (and possibly more apparent then real) differences in the "channel construction instructions" for scenarios which should be comparable. I know this has been discussed previously but I do not think the question has been resolved. The attachment outlines the query.
TIA for any comments.
lj
Another reason for non-comparability, is apparent (and possibly more apparent then real) differences in the "channel construction instructions" for scenarios which should be comparable. I know this has been discussed previously but I do not think the question has been resolved. The attachment outlines the query.
TIA for any comments.
lj
There are two things I noted about the examples you used in your question, which hopefully will help -
1. The bar for point 1 is used to set the LTL in the first figure because its the first bar going in the direction of the new tape. The bar for point 1 in the second figure was going in the opposite direction.
2. In my world, channels (and thus tapes) almost always have their points 1, 2, 3 ordered temporaly. In other words, pt 1 must come before pt 2, which must come before pt 3.
In figure 1, pt 1 comes at the high (bar open) and pt 2 comes at the low (sometime after open and before close)
In figure 2, pt 1 comes at the close of the down bar, pt 3 most likely comes next, then price moves up to pt 2. Because pts 2 and 3 are on the same bar, I don't get too excited about the temporal rule being violated.
HTH
-Au
Chart for today:
11-28-2007 ES Chart
- Spydertrader
- Spydertrader
In the spirit of discussion allow me, au, to address your take on the query.
The bar for point 1 in the first figure indeed is going in the direction of the new tape but I'm sure there will be cases where a bar like this will be of opposite color (just shift the open and close by a couple of ticks) but will still be an FTT, as it is here. So although your point is conceptually pleasing I don't think it a priori dictates whether the low of the bar should be the origin of the left side of the tape.
On the other hand, the honking red bar in the second example really is bothersome for the reason you point out but then I think this gets to the question of can we look at a developing channel in isolation or does there have to be context (the stuff that happens after it occurs)? Everything is "inside" up till the fifth green bar and then price dives down (possibly foretold by an intrabar shift in that last green bar). I don't know what the answer is and possibly a point could be made for drawing two tapes and seeing how the market plays out.
For me too the requirement that points be made sequentially is critical and in this case can be reasonably inferred to be as you describe for bar 1 in the first figure, even if you reversed the open and close. Again, the big bar 1 of the second figure is problematic because you would have to "run down the bar to the low, then up the bar to the high and then down the bar to the close" to fulfill the ordering condition for having point 2 as the high of that bar. Maybe it did that, I don't know, but we could be drifting towards an Ocham's razor thing and one wants to avoid that type of reasoning (or else go nutz, and run screaming off into the night "...on the one hand but on the other hand ..."). So perhaps looking at a shorter time fractal or using the YM might help, but again we're bringing in context.
In both cases there are formation considerations (sym and lateral respectively) which are often much easier to see retrospectively. So for me a combination of temporal ordering and context is what I would use to help figure out what's happening.
Thanks for your interest.
lj
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