Why do people use Volume, Range and Tic charts?

[ProfLogic]

Quote from bronks:

I know the individual bars aren't about volume per day. But won't the overall volume differential (per day) have an effect on... umm...nevermind.

Smoothing out the bars is one thing, reading the market with a static against a liquid just throws me a bit. The words stable and non-varying remind me of my x-wife... things that she definitely is not. But like I said, semantics. Cheers.

The volume differential per day is immaterial because price because a smooth flow not bound by time. Example the overnight flow is as accurate as intraday because the bar volume is consistent. The difference is the speed at which the bars are created in the overnight verses intraday or during the release of news affecting the chart you are watching.

Price is always liquid, the bars are the only thing that is static. The difference, simply put, is like watching a new digital movie on an analog set verses a HD TV. The movie is idential, the difference is in the clarity of the picture.

Far more than semantics but years of screen time is the only way you can confirm that for yourself.

 

[ProfLogic]

Quote from MandelbrotSet:

The concept of the range bar is just an extension of a PnF chart. I'm sure you're going to say that a student of yours invented them too.
And unless that's student's name is Cynthia Kase or hails from South America, it really strains your credibility to even make the statement that "a student of yours invented range bars" ... or for us to believe it.
Whatever.
This is getting boring.
Have a nice trading day.

Your use of Range bars might currently be an extension of a "Point and Figure" chart but they were concieved before that.
The first published article was 'Paradigm Shift Lights the Way to Momentum Bars' by Desmond MacRae, 'Stocks Futures Options', February 2003. The follow-up article was 'Momentum Bars: The sequel to the article titled, 'The Sequel' by Desmond MacRae, 'Stocks Futures Options', April 2003. These articles describe a charting concept developed by Danton Long called Momentum Bars (Range Bars). Danton Long and Desmond MacRae are accreditied with introducing them. My point was that almost 2 years before this article was published one of my students approached a software company about what he coined as "Momentum Break-Out" Bars which is exactly what you call Range Bars.

It must wonderful Jimmy to be all places at all times. What is boring Jimmy are your mood swings.

Good Trading to you as well.

 

[ProfLogic]

Quote from j0hnb0ne:

I completely understand them. A new bar does not start until a price tick is received that would exceed the fixed (user defined)VOLUME of the current bar. That and the 'phantom bars' are just that. There is NO need to add noise into an already noisey environment.

I thought its funny that your very same statement can be applied to volume bars.

Really, then you do not understand CVB charts.

Example: In a 2000 CVB Chart, a new bar is created after 2000 contracts have been traded.

Example: In a Range Bar Chart, the range bars just look price, the bar does not close at a specific time but closes when a range is complete, then a new bar opens.

It is obviously not the same.

 

[ProfLogic]

Quote from MandelbrotSet:

The concept of the range bar is just an extension of a PnF chart. I'm sure you're going to say that a student of yours invented them too.

And unless that's student's name is Cynthia Kase or hails from South America, it really strains your credibility to even make the statement that "a student of yours invented range bars" ... or for us to believe it.

Whatever.

This is getting boring.

Have a nice trading day.

I stand corrected Jimmy and I apologise.
I just spoke to my student and he informed me that he "borrowed" the concept from a friend of his in Brazil. He told me for years that it was his idea. His friend started using them in 1995-6.

 

[ProfLogic]

Quote from MandelbrotSet:

Here's (one of) my chart(s) showing my useless, noise trading, 3 steps back, range bars ... wonder which direction the trend was in last Thursday and Friday, LOL.

P.S. What are those markings on the side do you ask? Volume by Price, the key to using Market Profile.

Great, you, like many others, have mastered the manipulated chart. I have never said that one couldn't use them but for someone studying pure price they muddy the waters.

Trading is a skill and one doesn't begin learning a skill using professional tools, they begin using fundimental tools and progress from there. Once a person learns the how and why price does what it does, then one could use Range Bars with some consistency. Most of the individuals here in this forum are here to learn from the ground up and showing them tools they can not comprehend or yet understand doesn't help them unless you clarify their use.

The above posters opinion of the sameness of Range Bars and Volume Bars and then your snide remark following it, absolutely doesn't help, it hinders.

 

[ProfLogic]

Quote from just21:

Nicolellis Range Bars were conceived in 1995 by a Brazilian broker and trader - Vicente M. Nicolellis Jr.

During 13 years running a trading desk in Sao Paulo, where local markets tend to be volatile, he wrestled with the problem of how to handle this volatility and its variability. Finally he concluded that the most promising approach would be to eliminate time from the equation, and just concentrate on price.
After all it is price that you trade (rather than time, unless it is an options market).
Essentially this reverts to the early days of Technical Analysis, and the use of Point an Figure Charts which just record price changes.
By using a constant range, ex. 10, and opening a new bar once that range is covered, one can also apply modern concepts of indicators, which are bar based.
In 1996 the concept was computerized, which meant that many more markets could be studied.
Experience in the last 8 years has shown that Nicolellis Range Bars are particularly good at focusing on and clarifying movement.
The way in which a long meandering, horizontal "congestion" is condensed into a bar or two, concentrates attention on the essential underlying price movement while eliminating unnecessary "clutter" and "noise".
This also makes the use of Trendlines easier.

from www.fibonaccitrader.com

Yes, I just confirmed this as well.
Thanks!

 

[Lamont_C]

Quote from FortuneTeller:

Elaborate please.

Price and volume are continuous and are independent of whatever choices the trader makes to display them. Time, range, CV, and so on each have their advantages and disadvantages for a given trader, but price couldn't care less how one chooses to display it.

LC

 

[marketsurfer]

it seems to me that there remains a fundamental logical problem regardless of how the "bars" are calculated. It's similar to having a perfect mathmatically based horoscope wherein the horoscope is perfectly and 100% correct within the context of astrology but the entire premise of astrology is fundamentally flawed.

let's start by examining the premise of this form of analysis. correct me if im wrong, but its that the markets continually repeat themselves in a fractal manner??

After this is answered by the believers/users of these methods, I can move on to point #2.

regards,

surf

 

[ProfLogic]

Quote from Lamont_C:

Price and volume are continuous and are independent of whatever choices the trader makes to display them. Time, range, CV, and so on each have their advantages and disadvantages for a given trader, but price couldn't care less how one chooses to display it.

LC

Well stated. Price is the foundation of all market charts. It is the PERFECT place to learn from and build on.

 

[ProfLogic]

Quote from marketsurfer:
it seems to me that there remains a fundamental logical problem regardless of how the "bars" are calculated. It's similar to having a perfect mathmatically based horoscope wherein the horoscope is perfectly and 100% correct within the context of astrology but the entire premise of astrology is fundamentally flawed.
let's start by examining the premise of this form of analysis. correct me if im wrong, but its that the markets continually repeat themselves in a fractal manner??
After this is answered by the believers/users of these methods, I can move on to point #2.
regards,
surf

First, bars are created not calculated. Calculations are necessary when dealing with statistical chart data but not with logical chart data. The differences are exact and important. Logic & Statistics can both be applied to fixed environments but Logic can not be applied, with any consistent success, to variable enviroments. That speaks volumes to those that understand the difference.

Horoscopes are never perfect and are never 100% correct even within the context of astrology because the entire premise of astrology is fundamentally flawed due to its "outcomes" being based on overlapping human traits . . . amoung other irrelevant reasons.

Charts move fractally not markets. Fractals are only accurate when they are viewed inside stable nonvarying environments. Einstein, who is smarter than both of us, proved this with research into oscillations.

Markets are not consistent because "Markets" can be broken down and viewed in thousands of different and variable ways as well as nonvariable ways. Some of the variable ways are:

Daily charts
Weekly charts
Monthly charts
Yearly charts
Fractional Daily charts
Fractional Weekly charts
Fractional Monthly charts
Fractional Yearly charts
Multiple Daily charts
Multiple Weekly charts
Multiple Monthly charts
Multiple Yearly charts
Hourly charts
Minute charts
Second charts
Fractional Hourly charts
Fractional Minute charts
Fractional Second charts
Multiple Hourly charts
Multiple Minute charts
Multiple Second charts

And on top of that you have Tick charts with an endless number of choices to create charts, each one a variable in itself due to ticks containing a random number of contracts or shares trades per tick.

Time, though a constant in itself, contains the ability to reek havoc on the stability of volume of a chart. Volume per "time increment" is never stable and stability is critical in ANY problem solving environment.

This is why, when given the option, why would one introduce inconsistency, variability and noise into their view of the markets, though most do. It's because they do not know better because they prefer to listen to the "statis quo" instead of verifying alternatives and thinking for themselves.

I speak for myself, but I do not blindly "believe" in anything in this environment unless I can verify it with my own two eyes. I simply expect the same from others, not the lip service I get from individuals like yourself that make comments based on "your opinion" which is NOT founded on any personal research you have ever or will ever do. When you or if you EVER decide to do ANY specific due dilligence in regards to your opinions in this matter then those opinions become relevant. Until then your questions are viewed simply as being argumentative. They certainly are snide and condescending considering your lack of personal experience and knowledge regarding this information.