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Some charts to illustrate your point:
1. Basic upthrust : sign of weakness is it not? TG signal afterall, ideal place for short, chart 1
2. Dogs did not bark chart 2, again End of Rising Market on huge vol, bar closing in the middle, supply swamping demand, short again????
3. chart 3, wrong again. |
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The UpThrust is in an uptrend, and not a valid signal. You have to see an UpThrust after weakness. There is no weakness on that chart. When you have weakness in the background (Buying Climax, distribution range, or a down trend), it is an excellent signal.
It is an upthrust, but in the wrong context. It thus has little meaning, as far a signal goes. It's what they call a "polar bear in Hawaii."
The End of a Rising market had some volume, but I'll bet not ultra high for that market. Also, it has a wide spread. You really want to see ultra high volume on a narrow range bar into new high ground. Close doesn't seem to matter. These are pretty rare. The idea is that buyers are attracted because the market has hit new highs (big news, everyone sees it). But, with the narrow range, the market is being capped and selling is swamping demand. More than one or two day's worth of data is needed to have a valid ERM signal.
Hope this helps,
Eiger