This is a brief comment.
My effort right now is to get copy to you to follow up on the beginner internals and to do batting practice on the DOM.
The harmonic aspect of both is going to be popping up once in a while.
for our purposes I want to be clear that the basis of dealing with waveforms on price and volume and indicator moments is to look at cycling and how patterns are a synthesis of periodic functions (think sine vaves for example).
They come as harmonics (1, 2, 4, 8 etc) and as overtones (1, 2, 3, 4, ..).
People often work with "series" which are sums of terms. All terms have "amplitude, frequency and phase angles.
For simplicity let the amplitudes be the same and the phase angles be zeroed out.
If a reference is made to one kind of series or another it implies that there are a lot of terms.
By adding a lot of terms together, you can get different waveforms.
An even series would have 2. 4. 6. 8. 10, etc as relative frequencies. An odd series would have 1, 3, 5, 7, 9, etc as relative frequencies.
Draw a cycle as a sine wave. Drw another superimposed upon it where the frequency is three times the first sine wave.
In the first half of your drawing you see the hump of the fundamental and two humps from the 3 times frequency. Add the two together for the first half cycle and see a head and shoulders formation. The second half gives you an inverted head and shoulders. This drawing you have done is of an odd series.
If you added in some more odd multiples of the fundamental you would come closer and closer to a traigular wave form. this is the limiting case of an odd series. You will notice that a lot of the time we see long and short hcannels creating a sawtooth series of peaks and troughs. All of this shows odd series type price movement.
You can repeat all of the above using just even values: 2, 4, 6, 8, 10, etc. The result, in the limit, is a squarewave function. This is where the double top and double bottom come from.
Price is also influenced by volume.
Odd or even formations can be affected by volatility changing as a consequence volume decreasing continually. The CCC and the pennants are examples of this. We will soon come to see that stalls, hitches and dips are affected similarly.
Our effort is to make money. So we build an use tools that help us make money. You see that the syllabus introduces tools one after another to make the money making ever more precise as we add another tool.
the beginner internals is dealing with patterns and formations within the channels. Channels are contemporary psychological boundaries of price and for making money we take them and their contents into consideration.
We spent time dealling with the outer boundary (forest) and it's internal formation the FTT. We moved to more detail with the traverses (trees) and their internal formation (yet again FTT's )and turns on boundaries.
The DOM is where we now focus as our effort to deal intrabar and discern formations and patterns quite closely. The WALL begins this learning for this month.
In the heavy scalper thread OP'ed by cferret a while back an scenario was presented in regard to the DOM and the way in which it is possible to see many games played by various sized traders. I let them wear jersies according to the significance of their influence.
So we will look at the WALLS and we will look at the place holders of units, tens, hundreds and thousands in the DOM. Side by side with the DOM is the T&S. DOM is the "talk" and T&S is the "walk". To talk in the hundreds and thousands, the talker needs margin, just keep that in mind. You can think of the combination of the games on all the levels as the same as the composite of the periodic series.
As the head batter suggests, we are looking at the DOM the way we look at Stretch/Squeeze, Gaussians, and tapes, traverses and the outer boundaries of price movement.
Look at how the WALLS come into the picture and how they limit directional movement, finally. Look at the values and sums of values on the DOM. Look at the hundreds and tens placeholder values to see what active skilled traders are doing. Observe when a person is "playing" on the thousands once in a while.
This also gives you the picture of what people who do not know how to trade operate. they are not thousands or hundreds or tens people. They are the temporary people who come and go as their money is used up (the units people).
We are building an onion. The core was done in JAN/FEB: the forest and the FTT's. Each additional shell was added with additional knowledge and through experience skills were acquired.
Rule #1 was the first rule. You always use the first rule to make the big chunks of money.
Adding shells is doing batting to be a better batter building on past knowledge and skills.
In this last triad of months, we add shells that show, deeply, the continuity of the market's operation. Because of this sequencing that gives continuity, we turn our focus now to honing the holds and the reversals.
The hold endures as time passes because the WALLS are not imposing their will at first because they are so remote from the BBid and BAsk. Reversals become more important as the market tells us that the price can no longer make progress in a given direction.
By doing the core first and the subsequent shells, we gained a great perspective of the intraday activitiy. We used data sets always and did not do "freakout reactions" to single element data sets.
The DOM adds another tool. The DOM is an element of the data set from this point on. We are not changing the MADA nor the sweeping. "Freakout" is not part of our trading style.
What is happening is that all the core and the shells are at work. At various times we glance at the str/Squ because, then we need it for our data set. most often we see the +2/-2 band is containing the values. That is because we are "continuing" to rack up tick after tick of profits at a money velocity in keeping with the container we have annotated, in advance, for price to fill.
when "end effects" of price movement come into he picture as anything (flaws for example), we make approapriate glances in places to "see" more. I call it steering and focusing for the moment.
In these last months, we are going to capture the essence of the markets. this is where your feelings of support, comfort and confidence will prevail. The "knowing that you know" from Info Gap theory.
Price moves because the "minority" evaporates tick by tick. Price is also affected by "games"; we get to see and learn these at this point of detail.
As time passes it becomes more and more evident that the market operating point moves as a consequence of alternatives being blocked until there is only one path left. Having a display that enables you to "see" the market is now coming into the picutre in yet another way. The DOM and T&S take us over the halfway mark. And it gives us the first participant view of the future.
It is extremely important to introduce a symmetry where the axis is the present and the near future and near past are there to view. This was not always true. For a long time (before the minis) it was only possible to see two degrees of freedom regarding the future.
The DOM introduces this symmetry about the NOW. We need to begin to look and "see" what is cooking. We need to know the pitcher's plans for the next pitch or so. What isn't the games being played tells us this.
This is the point in your trading skills acquisition where time is going to slow down quite a bit for you. we are moving into slow motion trading at this point. Way past "freakout" land that causes fear, anxiety and anger.
