Thanks 8833 for sharing. So far, volume gaussians have been the most difficult thing for me to get. I too study Spyder's excellent charts, but sometimes I don't know why they (volume gaussians) are drawn the way they are. When I'm annotating my charts in RT, I tend to look at the volume in a rather literal sense - that is when I see rising prices on continuously lower volume, I think change is coming up. (I keep referring to the Jokari Window). Sometimes however, this doesn't translate into the same volume gaussians that Spyder draws or others for that matter. I will say though, the more I annotate the charts in RT, the more familiar they look. Perhaps this is part of that unconscious competence that we're all learning!
Spydertrader's Jack Hershey Futures Trading Journal
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If you review this post, you'll note where I have market areas important for bar-to-bar monitoring based on one's particular resolution level. In addition, this post explains the importance of recognizing the size of the Forest one plans to monitor.
Channels and Gaussians operate hand in hand throughout the trading day. If one looks closely on my chart for today, you'll notice the Increasing Red Gaussian ends where a change occurs - where Price can go no lower. Even though the final Volume Bar and Final price bar might show Black, Price went to its lowest point on that bar. The same holds true within an Up Channel. The final bar in the up move might actually turn red in color, but price made a new high on this bar and then changed. What we then see is an Intra-bar Gaussian shift. In other words, Red dominant changed to black dominant with the bar itself.
In addition, traders often fail to see increasing or decreasing volume because they are too busy monitoring bar to bar. At certain times during the day (based on one's resolution level - See linked post above) one needs to monitor bar-to-bar. The rest of the time, one needs to monitor at one's resolution level. In other words, "the big picture." Across the entire Forest (or tree or limb), one will always see the correct Gaussian formations corresponding to that particular Forest. As a result, only rarely do we see Gaussians act in perfect synchronization bar-to-bar (Yellow Highlighted Volume Bars). The rest of the time, flaws, smaller forests (or trees or limbs) effect how the Gaussians look in the shorter term. As long as you always know where you are within the Forest, you'll know where you are with respect to Gaussians as well.
With respect to Mak's comments, you might want to review his exact words. I do not recall Mak saying "not to worry about Gaussians on the Forest Level."
Remember, 'Sufficient Data Sets' means looking at the correct information at the correct time. Try not to say, "What does this volume bar mean?" Instead, try to think, What do I need for continuation (at my current resolution level) and what do I need for change (at my current resolution level)?" and you should begin to see things with improved clarity.
Good Trading to you all.
- Spydertrader
Been lurking for awhile. Finished the 3 equities journals last month. Just got caught up with the futures.
I want to thank Jack for teaching his methods.
Thank you Spydertrader for your tremendous effort to pay it forward. You'll probably never realize all the people you reach.
Thanks to Mak, Pr0crast, bundlemaker for your help also.
Thanks to everyone participating here.
To the skeptics: Do the Work. It is alot - the rewards are more than money!
-Mike
I want to thank Jack for teaching his methods.
Thank you Spydertrader for your tremendous effort to pay it forward. You'll probably never realize all the people you reach.
Thanks to Mak, Pr0crast, bundlemaker for your help also.
Thanks to everyone participating here.
To the skeptics: Do the Work. It is alot - the rewards are more than money!
-Mike
it's interesting that OC get alot out of gaussian, so I duplicate his scale and notation on my chart to see why. I notice that some of bars have diff in height & color. I also I had to zoom in my chart 5X in order to match his scale. Some quick observation 1) a widen scale might help in seeing gaussian clearer. 2) don't expect a perfect pattern due to color diff or bar height diff, use your imagination instead,
Yes and No. Even though CCC presents itself most frequently in a lateral formation, CCC results from extremely low volume levels. Laterals occur with decreasing volume in the same color of the dominant trend. However, one can view an HVS as 'multiple stalls in a row.' Although an HVS can occur in the form of a lateral, an HVS represents multiple stalls which occur in opposite directions one after the other - and does so at higher volume levels (for the most). Individuals trading on the Forest or Tree Resolution Levels do not need to differentiate between the various types of 'flaws' as all flaws require the same action - Hold.
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