switching gears to Price Action via SLA
- Thread starter gears
- Start date
I tried this experiment and I made some discoveries but I'm not sure what they mean. The essence of what I'm seeing is the acceleration of trend which normally occurs as a climatic end of the trend is transposed to the beginning of the trend. Essentially this makes it easier to see the slope of the trend. And it has something to do with the reversal (when in normal right side up mode) not being as easy to discern when right side up.
I am certain there's some lesson in this but the full implications of what it means escapes me at the moment.
I began the session by looking at the daily chart. Price was near the long-term mean after having gone lower than the previous two lows.
Then I checked out the hourly. Chart is a little messy, but the SL seemed to have been broken definitively with a series of higher highs and the swing lows either meeting or being higher than previous lows.
B - made a higher high and exceeded a previous swing point.
C - went back down to the previous swing point, but didn't stay there and rocketed back up.
D - exceeded the high from B and was followed by an equilibrium period and then another higher high
Then I looked at the 15 minute chart. The overnight high of 4178.5 at 2215 was established and since then price had been trending downward - a series of lower lows and lower highs.
To be honest, I didn't know where the day would go. At the 100k foot level (daily), price was in the middle and could go either way. At the 50k foot level (hourly), the tide might be turning. At the 25k foot level (15 min), down was the most recent movement.
Then I checked out the hourly. Chart is a little messy, but the SL seemed to have been broken definitively with a series of higher highs and the swing lows either meeting or being higher than previous lows.
B - made a higher high and exceeded a previous swing point.
C - went back down to the previous swing point, but didn't stay there and rocketed back up.
D - exceeded the high from B and was followed by an equilibrium period and then another higher high
Then I looked at the 15 minute chart. The overnight high of 4178.5 at 2215 was established and since then price had been trending downward - a series of lower lows and lower highs.
To be honest, I didn't know where the day would go. At the 100k foot level (daily), price was in the middle and could go either way. At the 50k foot level (hourly), the tide might be turning. At the 25k foot level (15 min), down was the most recent movement.
So that takes me to the open and thereafter…
A few things are marked on the chart:
-Blue downward trend lines from the 15 minute chart.
-50% level of the PDL and PDH
-PDH
A - The NY folks arrived and price immediately fell. The 50% area of the PDL and PDH was breached, but price pretty much rocketed away from that level.
B - Price marched steadily all the way to the PDH area - very few pauses and was not interrupted much. But just as soon as it hit that level, it turned around and headed south. (Not a tremendous surprise - where there aren't pauses along the way, the tide can turn in the opposite direction just as quickly as it made the trek).
C - Price made it to the 50% level of the distance just traveled (4137 to 4181).
D - Price was able to go further than that level too, but rebounded after a bit of hesitation. Is price heading back up or will it continue to go down?
E - Price headed back up, but the buyers seemed a little lonely up there. Price headed into an equilibrium area. A little up, a little down. The highs weren't higher and the lows weren't lower.
F - Price did make a higher high, but was then back into the equilibrium area. A subsequent attempt to go higher resulted in a lower high where there was a definite struggle to find value.
G - Price then took another trip to the lower end of the equilibrium area, but that wasn't a popular area for buyers and sellers because then the upper end was again attempted.
H - A new higher high was established, but the high from B hadn't yet been met.
I - A subsequent higher high occurred, but immediately price rebounded to the swing low just established and exceeded it. So - a HH, but it wasn't sustained. Then a LH occurred and the swing low was again visited.
J - Then price took off. The level from B was exceeded and price was definitely heading up.
K - After a parabolic move, price didn't rebound much. Is that a sign that I'm not quite seeing the significance of yet? I guess I need to keep watching to learn.
A few things are marked on the chart:
-Blue downward trend lines from the 15 minute chart.
-50% level of the PDL and PDH
-PDH
A - The NY folks arrived and price immediately fell. The 50% area of the PDL and PDH was breached, but price pretty much rocketed away from that level.
B - Price marched steadily all the way to the PDH area - very few pauses and was not interrupted much. But just as soon as it hit that level, it turned around and headed south. (Not a tremendous surprise - where there aren't pauses along the way, the tide can turn in the opposite direction just as quickly as it made the trek).
C - Price made it to the 50% level of the distance just traveled (4137 to 4181).
D - Price was able to go further than that level too, but rebounded after a bit of hesitation. Is price heading back up or will it continue to go down?
E - Price headed back up, but the buyers seemed a little lonely up there. Price headed into an equilibrium area. A little up, a little down. The highs weren't higher and the lows weren't lower.
F - Price did make a higher high, but was then back into the equilibrium area. A subsequent attempt to go higher resulted in a lower high where there was a definite struggle to find value.
G - Price then took another trip to the lower end of the equilibrium area, but that wasn't a popular area for buyers and sellers because then the upper end was again attempted.
H - A new higher high was established, but the high from B hadn't yet been met.
I - A subsequent higher high occurred, but immediately price rebounded to the swing low just established and exceeded it. So - a HH, but it wasn't sustained. Then a LH occurred and the swing low was again visited.
J - Then price took off. The level from B was exceeded and price was definitely heading up.
K - After a parabolic move, price didn't rebound much. Is that a sign that I'm not quite seeing the significance of yet? I guess I need to keep watching to learn.
Doing some replay - 20150115 morning session: prior day swing high (pink) and swing low (blue) indicated on chart. Swing low wasn't marked correctly - should have been a little lower, but the end result of my observations are the same.
1 - At NY open, price tried to get up to the ON high. Couldn’t do it - rejected first time, but then it was met and exceeded. Yet again, the level couldn’t be maintained.
2 - Some hesitation down, but then price just started to cruise south.
3 - After the parabolic fall, there was some hesitation, but then again, price resumed the downward move.
4 - Another slight pause and some traction back up, but the sellers have the upper hand.
5 - another pause, but nothing substantial
6 - herky jerky movements. Lots of bouncing up and down trying to find value.
7 - spending a lot of effort to maintain the lows. Just as soon as a new low is achieved, it isn’t retained. Balance has shifted (however temporarily to the buyers)
8 - new LL - and price just dropped
9 - finding equilibrium and trying to get back up, but the buyers weren’t there to make the transactions happen
10 - seeming more and more difficult to keep moving down
11 - then price just popped to the last swing low. Hung out for a few minutes to regroup and then more downward movement
12 - each pop downward is swift (short timeframe) and the rebalance/equilibrium phase is longer to regain the ground lost.
13 - HL?
14 - back to swing low area and another HL.
15 - exceeded swing high from #9 - after 2 HLs and exceeding the swing high, balance has shifted to the buyers.
16 - price is making its way up to the 50% level of the down move.
17 - through the 50% area of the down move - can it hold there or will price now head south?
18 - overall movement of price has slowed down - pace is quite different from 30 minutes ago.
19 - spoke too soon - price popped up with a bang
20 - price is moving like a seesaw - up and down - not much ground being made. But - it is edging up slightly and not going down
21 - and again I spoke too soon. Seems like the hesitation is so often a precursor to a big pop of price.
22 - can the swing low be breached? Haven’t really had an attempt at a HH in a few minutes.
23 - third time I’ve spoken just a little too soon. Tried to get back up and make a HH. This patience thing is quite important.
24 - bumped/exceeded (just barely) the swing low. Will it hold or will price continue to head south?
25 - another attempt to go back up and it didn’t happen.
26 - 3rd successive LH even though price isn’t going substantially in either direction.
27 - more hesitation/equilibrium before a pop down. The LHs should have been a clue - duh
Then the replay just stopped. It was a good session though. Watching the right tick/price move during replay is so different than looking at static charts.
1 - At NY open, price tried to get up to the ON high. Couldn’t do it - rejected first time, but then it was met and exceeded. Yet again, the level couldn’t be maintained.
2 - Some hesitation down, but then price just started to cruise south.
3 - After the parabolic fall, there was some hesitation, but then again, price resumed the downward move.
4 - Another slight pause and some traction back up, but the sellers have the upper hand.
5 - another pause, but nothing substantial
6 - herky jerky movements. Lots of bouncing up and down trying to find value.
7 - spending a lot of effort to maintain the lows. Just as soon as a new low is achieved, it isn’t retained. Balance has shifted (however temporarily to the buyers)
8 - new LL - and price just dropped
9 - finding equilibrium and trying to get back up, but the buyers weren’t there to make the transactions happen
10 - seeming more and more difficult to keep moving down
11 - then price just popped to the last swing low. Hung out for a few minutes to regroup and then more downward movement
12 - each pop downward is swift (short timeframe) and the rebalance/equilibrium phase is longer to regain the ground lost.
13 - HL?
14 - back to swing low area and another HL.
15 - exceeded swing high from #9 - after 2 HLs and exceeding the swing high, balance has shifted to the buyers.
16 - price is making its way up to the 50% level of the down move.
17 - through the 50% area of the down move - can it hold there or will price now head south?
18 - overall movement of price has slowed down - pace is quite different from 30 minutes ago.
19 - spoke too soon - price popped up with a bang
20 - price is moving like a seesaw - up and down - not much ground being made. But - it is edging up slightly and not going down
21 - and again I spoke too soon. Seems like the hesitation is so often a precursor to a big pop of price.
22 - can the swing low be breached? Haven’t really had an attempt at a HH in a few minutes.
23 - third time I’ve spoken just a little too soon. Tried to get back up and make a HH. This patience thing is quite important.
24 - bumped/exceeded (just barely) the swing low. Will it hold or will price continue to head south?
25 - another attempt to go back up and it didn’t happen.
26 - 3rd successive LH even though price isn’t going substantially in either direction.
27 - more hesitation/equilibrium before a pop down. The LHs should have been a clue - duh
Then the replay just stopped. It was a good session though. Watching the right tick/price move during replay is so different than looking at static charts.
Replay of today (1/22/15) as I wasn't able to watch live.
1. NY open, price headed up towards the ON high. It couldn’t quite get there and then seemed to switch gears to head down very quickly.
2. Moving with only slight hesitation toward the bottom of the ON range.
3. Regrouping after such a quick drop of 25 points.
4. Definitively dropped through the most recent swing point.
5. Also cruised through the ON low. Wow.
6. Lots of back and forth - herky jerky movement. But after the parabolic move down (15 points in 1 minute), there will be some rebalancing.
7. So another huge pop down - ho hesitation here. On top of the DL from the 60 min timeframe. Will this DL be a point where price springs from? If price slows down, it wouldn’t be a surprise after a 50+ move in 15 minutes.
8. HL or just a temporary pause?
9. Heading up toward the last swing high. Will it make it or is this just a push from buyers to recover some ground?
10. 2nd HL. Balance has shifted.
11. The range that price is covering in a one-minute timeframe has slowed down tremendously. Is this the pause before a pop up? Will price go crashing down? Things seem to be inching upward.
12. Breached the last swing high, but will it hold? Just shy of the 50% mark from the down move.
13. Got to the 50% area, but it was more of a stab up and an immediate failure back down.
14. Back down to the ON low area - and where a previous equilibrium area was. But at this level, there doesn’t seem to be as much activity as previously.
15. Another try to breach/hold/exceed the 50% level. (I still need to figure out what “hold” means to me or if there’s a general rule.)
16. Price is definitely moving up and with more vigor than earlier.
17. Most significant pullback in the last 10 minutes. Price has mostly been pausing, but it an upward nature. First really opposite movement.
18. Struggling to get back up to the previously established high, but not going lower or sustaining lower level at *.
19. HH established. Heading all the way back to the open? Will 4220 be tested again??
20. Another move up and getting closer to the rejection area.
21. Just shy of 4220. Quick pullback, but price isn’t moving lower. Seems that value might have been found for the moment (or 3).
22. ON high breached - and definitively. Quick push up.
I keep seeing repeatedly how important it is to be patient. I'm also seeing nuances of movement that I've never seen before - clues - or at least questions that cause me to review everything presented.
1. NY open, price headed up towards the ON high. It couldn’t quite get there and then seemed to switch gears to head down very quickly.
2. Moving with only slight hesitation toward the bottom of the ON range.
3. Regrouping after such a quick drop of 25 points.
4. Definitively dropped through the most recent swing point.
5. Also cruised through the ON low. Wow.
6. Lots of back and forth - herky jerky movement. But after the parabolic move down (15 points in 1 minute), there will be some rebalancing.
7. So another huge pop down - ho hesitation here. On top of the DL from the 60 min timeframe. Will this DL be a point where price springs from? If price slows down, it wouldn’t be a surprise after a 50+ move in 15 minutes.
8. HL or just a temporary pause?
9. Heading up toward the last swing high. Will it make it or is this just a push from buyers to recover some ground?
10. 2nd HL. Balance has shifted.
11. The range that price is covering in a one-minute timeframe has slowed down tremendously. Is this the pause before a pop up? Will price go crashing down? Things seem to be inching upward.
12. Breached the last swing high, but will it hold? Just shy of the 50% mark from the down move.
13. Got to the 50% area, but it was more of a stab up and an immediate failure back down.
14. Back down to the ON low area - and where a previous equilibrium area was. But at this level, there doesn’t seem to be as much activity as previously.
15. Another try to breach/hold/exceed the 50% level. (I still need to figure out what “hold” means to me or if there’s a general rule.)
16. Price is definitely moving up and with more vigor than earlier.
17. Most significant pullback in the last 10 minutes. Price has mostly been pausing, but it an upward nature. First really opposite movement.
18. Struggling to get back up to the previously established high, but not going lower or sustaining lower level at *.
19. HH established. Heading all the way back to the open? Will 4220 be tested again??
20. Another move up and getting closer to the rejection area.
21. Just shy of 4220. Quick pullback, but price isn’t moving lower. Seems that value might have been found for the moment (or 3).
22. ON high breached - and definitively. Quick push up.
I keep seeing repeatedly how important it is to be patient. I'm also seeing nuances of movement that I've never seen before - clues - or at least questions that cause me to review everything presented.
The hour prior to the open, price had hit the 1/9 swing area again, but not quite the ON high and had gone to the lower end of the ON trading range. Just prior to the open, price was making it’s way up to the 50% level of the recent down move.
As usual, patience is key. Little jibs and jabs one way or another for a few minutes do not mean that the market is going to take off in that direction. However, when multiple clues exist, listen to the market. No - I'm not thinking of trades or simming - just trying to get that thought process to be my mindset.
- Price hit the 50% level of the down move and then shot like hell downward. Rejection like touching a hot stove.
- Quick down move to a swing high area from 1/9.
- Some regrouping. Can’t make it up to the 50% level again, but traction isn’t occurring for price to go down either. Sort of looking like a hinge…
- Unable to get lower.
- Stab up, but buyers seem a little lonely.
- Still not able to make progress down. Nobody seems to be in charge right now. Hanging out in the congestion area from right around 9AM.
- Swift move up. Trying for the 70s again?
- Parabolic up and a big reaction down, but not as far down as the last down move. Though ugly (not smooth and trending), the overall movement of price is up, but buyers aren’t completely in charge. Sellers are adding supply to keep prices from rising too quickly.
- Until there’s an attempt up that makes a LH… Let’s try again. Can’t make any progress then either. Even so, price isn’t giving up much ground down - it just isn’t racing up.
- Still no luck down. Another attempt on the high side?
- Yup. Let’s see how buyers and sellers react to the 70s and if they’re trying to get back to the overnight high level.
- Got up near it and held…
- Another strong reaction down and close to the previous pullback area.
- Made another HH, but just marginally higher. The right tick is indicating to me that the small movements up are a struggle and the down movements seem to be more fluid.
- Not sure if my DL is drawn correctly, but price is hugging it and also got back to the same pullback area after making the marginally HH.
- LH or just a pause?
- DL broken. Swing areas broken. Balance has shifted.
- Pause around 50% level and looking left this has been a popular congested area this morning.
- SL crossed and strong push up (drew SL that wasn’t trying to strangle price). Is this the beginning of a resumption back up with the 50% level holding?
- HL
- LH
- I’m sure this is an equilibrium area, but it seems to still be showing some downward clues. Patience…
- Fanned SL drawn and it was immediately broken, but price couldn’t make much progress up. Let’s see if it can get back to the low just established.
- It did - and then some. Heading back to the low 50s?
- Price moving more smoothly. Move down, slight pause. Move down, slight pause. Let’s see how long it lasts and if the swing area from 1/9 as resistance acts as support again (right after the open). Drew a steeper SL.
- Price hovering just outside the less steep SL.
- Quick big pop up. I guess that area around 52 will remain as a support area. Price has now traveled both up and down a 20ish point range. Will it keep bouncing back and forth or will one side take control to move price outside of this range?
- LH? I guess I won’t know for sure until the recent pullback area is breached. Again with the patience…
- Swing area breached after 3 attempts to make a HH. Guess the information was present - I was just trying to be patient.
- Price made its way down to the 50% area. Slowly but surely, a wider hinge is forming.
- Price couldn’t seem to get past the 50% area. Steadily making upward progress.
As usual, patience is key. Little jibs and jabs one way or another for a few minutes do not mean that the market is going to take off in that direction. However, when multiple clues exist, listen to the market. No - I'm not thinking of trades or simming - just trying to get that thought process to be my mindset.
My software was hosed this morning (corrupted file) so I wasn't able to watch the market live as I'd hoped. So here's my replay of this morning after I was able to get things back on track.
Back at it tomorrow...
- Had been a series of LHs and LLs since 0845ish.
- Broke through the ON high area and seemed to bottom out. Quick movement down with very little hesitation.
- Pause around the area where a number of trades had occurred in the 0500 hour.
- Hit the 1/23 swing low area and bounced up like a hot stove had been touched. And back into the equilibrium area.
- Another attempt at the 1/23 swing low area. Hovering around the same area. Price isn’t retreating, but it just isn’t making continued downward movement. A little bit of equilibrium…
- Hung out for a little bit, but continued the time spent heading down is being rivaled by the time spent trying to go back up. Due to the time of day, things seem quite fierce, but it’s like just more consolidation/equilibrium.
- Making progress down, but the balance of “who’s in charge” is not clear right now. Still not going back up, but the movement is not smooth and definitive.
- Spikey up movement followed by a HL?
- Making progress in the up direction more than previously. Movement isn’t as much sideways as it was earlier. Can the last swing high be breached?
- Equilibrium. Buyers and sellers are content to hang out in the 54-56 range for a little bit. And then there’s a search for new value down followed by a search for new value up.
- Sought new value down and up and ended up back in the equilibrium zone. For the subsequent few minutes, price couldn’t reach either level - the down or up. Which way is price heading?
- Price is heading toward the 50% area of the down move, but not nearly with the flourish of the down movement. The swing highs have been breached.
- Hesitation before a pop down. The move up has felt much more laborious than the move down. The time moving up is countered with a lot of sideways or retracing movement down. Buyers aren’t really in control.
- More definitely trying to make another trip down and there’s quite a bit of hesitation near the last swing low.
- Can’t quite make it to the swing high
- HL? Twice the area is tried and 52 is not breached. Buyers and sellers are yet again comfortable in the 54-56 range. Price isn’t making HHs or LLs - it’s just hanging out until either buyers or sellers take the reins - equilibrium.
- An attempt to go to the low side, but again price moves back into the middle of the equilibrium area. Buyers and sellers seem quite comfortable for the time being.
- Buyers able to find transactions above the equilibrium area without price immediately retreating back into it.
- Will the 50% area again act as resistance? Movement is more fluid here now rather than just after 10 when buyers were quite lonely.
Back at it tomorrow...
Market had been trending downward since 0300. During the last few days, price couldn’t make a HH and didn’t make it back up to the long-term trend channel. Price hanging around the midpoint of the long-term channel…
As always, patience is necessary. This is such a recurring theme, but I'm still surprised by it. Big pops tend to result in strong opposing movement. Slower, steadier movement gives both buyers and sellers time to adjust to new value areas. Though this morning was a bit of back and forth, the overall trend was down.
- At the open, price quickly fell 10 points and then paused.
- Some more downward movement accompanied by another RET up which is buyers and sellers seeking new value.
- Another quick pop down followed by pullback of about half the distance. At this time, the time spent in retrace mode is longer than the time spent in the downward movement.
- Price heading back up in a definitive march toward the swing high and to the area where buyers and sellers were comfortable right after the open.
- Swing high not met or exceeded. An attempt for the lower area made again. Movement has slowed down. Though the general movement is down, it is occurring more slowly and deliberately now than right after the open. And then a quick pop up. More difficulty in making ground down than the quick response up after downward progress was made. LH?
- Again couldn’t get past the previous swing high.
- LL and price pauses for a bit, but the pause is more sideways rather than up. Buyers and sellers seem to have found a new value area.
- Some movement down that seemed hard fought (right tick making one step forward, two back, etc) and then a very swift pullback up. Though making lower lows, the opposing movement seems to be dominating the time spent in “up/pullback” mode. But even so, the overall nature of the movement is down with an SL slope that is much less steep.
- A series of LHs and a steady march down to the previous low area. Approaching the 1/22 swing low area. Will it act as support again?
- Typical retrace movement after a push down. Pretty even with the previous pause area before heading back down again.
- Less volatile movement up - pause/sideways rather than backtracking.
- Downward movement is swift.
- Made less downward progress before some pullback. Let’s see where this goes.
- Boom - pop down. Resembles the movement more like after the open. However, swift movement in one direction usually ends up having a more definite pullback - not just a pause.
- Yes - a more definitive pullback and inching up toward the previous swing high. This time it’s a series of HHs and HLs with the retrace movement being sideways rather than down.
- Inching up to the 1/22 swing low area.
As always, patience is necessary. This is such a recurring theme, but I'm still surprised by it. Big pops tend to result in strong opposing movement. Slower, steadier movement gives both buyers and sellers time to adjust to new value areas. Though this morning was a bit of back and forth, the overall trend was down.