Quote from Spydertrader:
I view your question as follows:
"I want to take action within a single five minute ES bar, what tools can assist my ability to do so?"
Note how your posts makes no mention of what occurs previously. As such, you have left the realm of adjacent bars, and traveled down into the rabbit hole. Nothing wrong with this, but when viewed from the standpoint of looking back across the last 11 months, what tools might assist your ability to 'see' inside a five minute ES bar? Certainly, the YM, Str-Squ, DOM, and OTR each provide Intra-Bar (ES) signals. Asking how to 'see' inside a Five Minute Bar without using the appropriate tool, is a bit like attempting to do Brain Surgery with a Sledge hammer and a Pick Axe. The beginning of this journal contains many examples where people attempted to do just this.
- Spydertrader
Spyder, your point is a good one. Right now, I don't want to even think about decision making inside of a 5m bar. To keep it simple, let's operate with our 5m bars, 5m volume, and 5m PRV.
I think what you're saying is that down at this level where I would take the short intrabar, to reverse properly I need to use the additional tools to see what's happening on a finer time frame.
Let's step back for a moment and look at the progression of the day, with only the information I suggest. From the start, we build tapes and channels, confirming through the progression that volume progresses consistently (gaussians).
We can have a succession of different channels, for example:
up channel -> dn channel -> pace decrease dn channel -> up channel -> pace increase up channel -> pace decrease up channel -> pace decrease up channel -> etc. etc.
This is in fact, the progression of channels (at least that I have) from the start of the day.
What I've generally noticed is wide channels, through this kind of progression, can lead to very thin channels that look to be on a finer fractal.
But are they? As illustrated in the attachment, the progression leads to channels inside channels, all the while remaining consistent with gaussians.
The issue is, it's easy to get "sucked in" to a level of detail such that additional tools are needed to stay on the right side of the market. The question is, if we are to simply use PV and channels, without those additional tools, how do we avoid getting sucked in. Another way of looking at it is: if we restrict ourselves to 5m price and volume (in order to master this relationship first), what do we need to AVOID doing so that our decision making keeps us on the right side of the market?
My thinking is that some of these channels in the progression have to be overlooked for trading decisions, otherwise we will be drawn into a level of resolution that demands those additional tools.
What think you?
RT
