Bearbull

Have a look at European Bourses, Dax and Eurostoxx, plenty of liquidity and price movement. 1pt on Dax 25Euro, and on Eurostoxx it is 10Euros. Ideal for trading prior to US open.

forgot the charts Dax was pretty much leading the way.

Despite rises in Tokyo and HK, buying momentum carried prices the European bourses straight into overhanging supply, ideal shorting opportunity. Anybody wishing to take the trouble to study previous posts and look at attached price action on Dax and Eurostoxx this morning, same principles, nothing esoteric, labyrinthine. Never mind "WHO is doing WHAT and WHY" Look upon the market as a single entity and free the mind to focus on what is happening in front on the chart. Leave others to engage in endless debates on who exactly is moving the market and what part of volume represents which entity ie. those in the know of events in advance, floor traders, scalpers, others with harmonics , some looking to convert squiggly lines into maths formulas etc.:crap:

Kiwi, why don't you talk to Db and ask why he made that decision, he had to weed out superfluous discussions day after day, not pertaining to the theme of the thread.

There is no problem in my head, nor with Db. Infact he had continuous problems shifting your posts elsewhere and it was his decision to bring an end to that. You entered that thread and were the main cause of the problem, not only were you off base but totally off the main theme of the thread, ie. to trade using wyckoff methods. Anyway don't wish to engage in any further debate with you, at least make an effort to address the questions directly with concrete examples and trades otherwise, keep blowing your trumpets here. you will always find an audience.

This is precisely the reason, the thread "Trading the Wyckoff Way" was closed down by Db. There is no claim made there, that, that is the correct and only way to trade. In wyckoff world the composite man is the market itself. You came in with your angle on professional/dumb money and how they position well ahead of everybody etc . Yes everybody on this website is savvy enough by now to realise there are different players on different timeframes in the market. Yes they know markets can be manipulated and are being manipulated. Yes you have stated many times over, you have a trading team who have been taking advantage of economic reports prior to their release long before the normal dumb traders and that you all have been doing this successfully for countless years. Nobody is denying any of this. All that was pointed out to you on the wyckoff thread was that any potential intentions of the professional via their inside knowledge or, imbalances between buying/selling pressure via order flow has to be translated into action via a trade, an exchange of buy and sell contract and this turn has to materialise on the tick chart. Trading based on Wyckoff methodology is only is concerned with that aspect but does not claim that any other way of looking at the market is wrong. Here you directed folks to have a look at 81min charts and volume, then specific questions were asked based on the observations of that volume and price actions and also on recent report releases. However instead of providing specific answers with specific examples, you have brushed it aside as you did on the wyckoff thread. What does this achieve? You have already managed to deprive anybody interested in following wyckoff's work and any meaningful discussion on a thread specifically setup to do just that and here you keep coming up with general statements which sound cosmic and profound at first glance but when specific questions are posed, why not come up with specific concrete examples. Not pointout, look there the market tested the low and prices rose, and pros took profit, that is all reflected on the chart and could have been detected by those who would have other tools including knowledge of Wyckoff method. We know info from the briefing.com works for you and could for many others but was it necessary to engage in long drawn out arguments on the Wyckoff thread on that subject.:doh:

BF, Prices have been taken down on the Globex, wonder if this is market manipulation prior to rollover , when under normal conditions, the market turns bullish.

The stop loss is dependent on your risk tolerance and account size., also the timeframe on which you are trading. The logical stop would be a couple of ticks below the hammer (for long trades) and vice versa. As for trade management you could achieve that via a number of ways i.e trendlines (wyckoff way), stay with the moving average, or move stop beneath each bar that moves in your favor, so in a long trade, do not be freaked out by a retracing bar and move stop under that, it will be most likely get hit prior to prices moving up. However all this has to be tested out , key is to keep losses to minimum and let profits run, easier said than done;)

It certainly looks that way BF, prices have been in range for a few days now, also the seasonal factor favours upside under normal circumstances, but with this ongoing credit crunch and loss of confidence who knows.

Steve, Thanks for clarifying your position, realise which angle your are coming from, it does not clash with Wyckoff but could provide an added edge to many who know how to interpret and employ the knowledge in advance in the market prior to everybody getting on board.

VolumeJedi, That looks pretty much on the track, it gets tricky when the market gets out of sync with the 3 day(TT) or 5day cycle (Linda.R method), Unfortunately on the Taylor thread, nobody seems to be interested in engaging in commenting on possible scenarios for the next day based on what has transpired today and in previous couple of days. Happy to look at some past chart, o.k for a while to learn the basics but then one has to move on to the practical level to observe how it plays out in realtime. LIke you I am no expert so a separate thread and joint effort with Eiger, WHY? perhaps, we could move forwards.

I meant PM Db directly, not me, I am not in charge of the forum, I contribute when I get time.

I have no idea whatsoever, It is afterall Db's forum and his decision. Those interested may request via PM to join the private discussion "Trading by Price"

Eiger, It would great to follow this up in the context of Taylor methodology, shame that the Taylor thread has fizzled out, some knowledge guys in there, Dogpile, Why?, but no much follow up I am afraid. Infact Frank provided an excellent summary in post 205, (I don't want to copy the whole post here) check it out. More detailed than Linda Raschke whose work I am very much familiar with since 2000, also that of George Angell. As for Taylors book, it is practically unreadable, he obviously was a competent trader but certainly not a writer . WHY? seems to have mastered it though:) If I were to read this: 5th Friday was a buy day, the gap up on Monday(sell day) was momentum carryover, selling into that the target would be the high of Friday. Tuesday (short sale day), opened gap down, so the first trade is the powerbuy I mentioned before followed by a sell at the high of Monday's range. So today in theory would be another buy day, but as it gapped up we have reverse situation of yesterday i.e first trade power sell and then a buy either on violaton of yesterday low or on a higher low which is what you have just explained. Lets see how all this pans out and we will take it from for tomorrow, I am sure it will highly educational for all of us, for it is good enough for L.R, it should be for us:) Blend of Wyckoff/VSA/Taylor, WTG

Excellent explanation of the setup with the blend of Wyckoff/VSA and also use of other indices Naz, Russ, Naz was leading there as was Dax which is great to trade, infact prices were positively on the march in Dax, the European traders tend to anticipate the moves in the US markets (most of the time they are spot on, but now and then goof up), You went long on that test bar, so presume the stop would be a couple of ticks 2 bars back, around 892.75, do you than wait for the target to be hit or manage via trendlines as per wyckoff on that same timeframe or switch to 5min, 15min. I know Tom advocates moving stops below each bar that moves in favor of the trade, allowing for one or two downbars. GH on the other hand goes into all sorts of stuff, diamonds, etc:)

How about if we read the price action this way, 1. Large amount of supply has been removed via demand coming in at A. 2. The next bar is down on similar volume but the prices hold as the close is above the previous suggesting demand is absorbing the supply 3. Now the prices can rise on low volume due to paucity of supply, ie. buying pressure is overcoming selling pressure at B 4. However before the prices can be marked up this supply has to be tested 5. We go down again but on lower volume, slackening of supply at D 6. This is immediately confirmed by the next bar where buyers have little difficulty in pushing prices up (low volume once again as at B 7. Those who were long and trapped at higher prices are now itching to get out , hence the next bar has volume coming in absorbing that selling and prices move higher. Just another alternative way of reading with the same principles

Wish you had clarified many many posts back:) Well at last I bump into somebody who can understand where I am coming from. Like you have a Wyckoff background and hence able to understand VSA without any problems whatsoever as VSA is derived from the original Wyckoff course anyway. However those who have not been through this route immediately go on the defensive as soon as Wyckoff was mentioned on this thread before. Glad the air is cleared now, your posts are indeed informative and I am sure many would benefit if they also took some trouble to learn from the original source as the knowledge gained therein would not only reinforce their understanding of VSA but also enhance their confidence in application of the principles.

Db, this is just great, the intent was to encourage those with genuine interest in learning Wyckoff, to read and re-read posts on this forum and in your blog (wyckoff pdf file including) and then spend quality time on the screen identifying buying and selling pressure and how the patterns are created via this, as per the principles observed and explained 100yrs back. It is certainly heartening to know Head2K has clearly benefited from all this. Hence the title Trading the Wyckoff Way, to get into the nitty-gritty, where to enter, how to manage the trade, where to exit etc. Keep it going, thanks to everybody.

Think if you look into Taylor Trading thread, there is an informative post on such scenarios, terminology used there is powerbuy and powersell. So if you had a couple of range up days,(called buydays) then a sellday is expected, however if the market gaps down, this sets up first a buy(powerbuy) and then a short later in the day, and vice versa, ofcourse not everytime;) Taylors work is most certainly not an easy read. but does have some good concepts as some of it is based on MP, auction theory.

Well that certainly is encouraging to know. I personally do not have any axe to grind against any methodology. As stated on one of the posts here, VSA was taught properly whilst Todd Kurgger was around as he had a good grasp on the subject and was a realtime trader, however since then it has really degenerated at TG. Anyway you are doing a good job in detailing all the principles in such complimentary ie. Wyckoff/VSA fashion.

Good to see you mention Wyckoff part in all of this

Well done Head2K, I am pleased for you, you have clearly benefited from your study. BTW your English is hell of a lot better than my Czech, have a friend there, the first words I learnt from him were "nasdravia" don't know if I spelt that correctly but he liked his vodka:) few other, " jean dobri, dobri vecher, dobra nots," "Yak shu mash" "pienkna" again probably all spelt wrongly

Db, you have explained the principles in detail on so many charts on your posts and they are once again all reflected in the oil chart. Folks just have to print the lot out and make a concerted effort to study. Here is the follow up to the first post which was dealt with a congestion during a continuation of a trend, this time Reversal is addressed. Once again material is extracted from the Wyckoff pdf file mentioned before. The buying and selling pressures that Wyckoff observed all those years ago play out on Dax 2min over an 80pt range today. Folks simply have to slog it out ie. to re-read the content over 50times , and then spend quality time on the screen as Db has pointed out to verify all this for themselves. No waiting for somebody to dish out off the shelf setups and hand holding. There is enough material in the wyckoff forum to undertake the task of constructing strategies/tactics etc, also get hold of Vadym Graifer's book. Reversal and Wyckoff Principles: Next day, June 20th, removes all doubts as to the immediate tendency of the average, for the market opens up a point and a half above the previous night's close and on a greatly increased volume makes a rapid advance nearly to 131, putting the average into new high ground above the previous trading zone. The heavy volume emphasizes the importance of this. (See Par. 2, Footnote Pg. 16.) The gain in the average over the previous day's high is more than 7 points and the close is near the top. If we have been watching the tape during the day, or refer to our Wave Chart at the end of the day, we observe this sudden change and we either buy during the session of June 20th with a close stop or we wait until the price breaks through its former highs and buy around the closing price of that day or the opening of the following session, June 22nd, as the market's behavior to here tells us we may expect a quick mark-up. We are not justified in reestablishing investment positions, however, for as explained in Paragraph 1, Page 19, we do not have the basis for a lasting advance. . June 22nd there is a higher opening and a gain of 7 points in the average, most of which is held for the day. The volume runs up to 4,600,000 shares -- the price is gaining in proportion with the rise in volume. A reaction on the 23rd shows that most of the gain of the previous day was lost, but the bullish indication therein is a shrinkage in volume to 2,600,000 shares -- nearly one-half the activity of the day before. That is our warning to sit tight. The 24th recovers the loss; the average advances 8 points for the day and 3½ points above the June 22nd high, or to 141, and the volume is the highest thus far, over 5,000,000 shares. We begin to grow wary of the bull side because that volume in comparison with the trading of previous weeks indicates selling by large interests. (That is, a probable buying climax.) We move our stops up within a point or so of the June 23rd low and await developments. The 25th makes a further gain of 2 points in the average, then the price slumps about 6 points, closing a point from the low, on volume of 4,300,000 shares -- large supply overcoming an excited public demand coming in, as usual, on the top of the rise. This is distinctly bearish.(*) We therefore close out our long trading positions and examine our individual charts for stocks which are in a weak technical position so that we can get short on the next bulge. *Note the shortening of the upthrusts, that is, the tendency of the high points to arch over, from the 24th to the 27th. June 26th shows a range of about 5 points -- a little narrower. Although the closing is near the top, the volume has fallen off to about 3,100,000 shares and the upthrusts are shortening. In the net, these indications are bearish. The outlines of a new trading zone have been tentatively established between 137 and 143. On the 27th, the average bulges over a point, narrows its range to 3½ points and closes with a net gain of about 1½ points on a volume of about 3,800,000 (Saturday's volume doubled). This looks like bidding up to a new high in order to catch shorts, and selling on the way down. We therefore put out some shorts, protecting our commitments with stops 1 3/8 to 2 or 3 points above the high of June 27th. On the 29th, the opening is lower and the price recedes from 144¾ (the previous day) to 140, closing near the low. We now observe that the average has spent four days moving sidewise, making no further progress after a steep rise from the June 2nd low and, following the 5 million share session of June 24th, there has been a steady decrease in volume. In view of our previous deductions, we interpret this to mean that there is a lessening of demand on the top of the rise. We also note that any further lateral movement or reaction would definitely break the upward stride established on the last phase of the advance from June 19th. Hence, we are ready to sell more stocks short if we can get them off on bulges. On the 30th, the average declines nearly 3 points to 137 on volume (2,000,000) about the same as the previous day. The market is still in the 137-143 zone but has now definitely dropped out of the sharp upward angle in which it rose from June 19th to the 27th, showing exhaustion of buying power. Low volume on the two-day dip to the bottom of the range 137-143, however, suggests we may anticipate an effort to rally back toward the high at 144¾. The way the market behaves on the expected rally will probably help to confirm, or it may contradict, our position; so we await developments. July 1st, there is a wider spread in the price, nearly 2 points higher closing, but volume shrinks to 1,700,000: bearish. On the 2nd, the market narrows to a 3 point range for the average and the closing is 1½ points lower on reduced volume -- increased dullness, lower close, and less volume indicate less power on the bull side. On the 3rd, there is another attempt to rally and the average reaches the old 143 supply line at the upper edge of the trading zone, closing about 3 points higher but volume is not measuring up to the standard of previous (late June) rally days. Nothing to be afraid of. (We sell more stocks short on this rally which is the bulge we have been waiting for, placing stops, as before, above the danger point, that is, the high of June 27th.) July 6th, a 2 point range for the average, closing nearly 2 points down on 1,000,000 shares. We read this as an indication that the rally of July 1st to 3rd could not be sustained and that the tendency toward narrow swings, heaviness and dullness is the result of the market's having become saturated with offerings. All bearish. (*) *The average is now on the hinge and on the "springboard" for an important slump. July 7th, a rally at the opening, then a 7½ point break in the average on decisively increasing volume (3,000,000). The market is now out of its former trading zone on the down side and the volume indicates that liquidation is being resumed. Thus the rally from 113 (June 2) to 145 (June 27) has run its course after lifting the average into the lower edges of the old December, 1930 - January, 1931 support area, and we must assume that the next test of the market will be around the levels at which support was rendered (122) on June 19th. If the large interests who bought on June 2nd and 3rd, and who undoubtedly distributed their holdings during the high markets of the last week in June are willing to take them back near or above the previous low levels, it will be an indication of their confidence in the future and a sign that the bear market is over. If there is no such sign, we conclude that the bear market has been resumed and that the June recovery was only an interruption of the main trend. We are on the short side and shall occupy that position until we see some reason for changing it, either to neutral or the bull side. A 2 point further loss on July 8th, a small rally on a 1,500,000 share volume during the 9th and 10th (as the average hesitates halfway back to the June 19th low), then a dropping off until, on the 15th, the average nearly touches 126 -- a 19 point decline from the top. On this day, prices spread over 4 points from high to low and close slightly above the middle of the 4 point range, on a 2,600,000 volume -- a minor selling climax. There is no follow through on the down side next day; instead, a quick rally and a high closing. Thus we have two indications which might lead to a rally. But that will be a normal occurrence after a decline of 19 points. It should, in fact, amount to 7 or 8 points from the low if it is to be a real rally. Halfway would be about 9½ points. Such a rally occurs from the 17th to the 21st and amounts to 9 points, thus affording another good selling level if we are not satisfied with the size of our short line. (*) *So that you may understand better how to handle your investment funds and may recognize thehazards in carrying stocks up and down through intermediate bull and bear trends -- a procedure that causes so many investors heart-breaking losses -- the following general observations are introduced at this point: The relatively small volume on which the market is now declining tends to lull the public into a spirit of indifference toward the market. But, contrary to popular impression, the low volume accompanying the steady downward drift is of bearish and not bullish import.

And if I may add, speed and order execution are both excellent on these instruments

Precisely, waiting ie. patience and the ability to consistently apply the rules of one's strategy along with a sound trading plan, all come under developing the required trading psychology;) Bump: Moreover without the initial stages of effort in developing a consistently profitable strategy, all the psychology and waiting is not going to get you anywhere. Might as well take up transcendental meditation Bump: Moreover without the initial stages of effort in developing a consistently profitable strategy, all the psychology and waiting is not going to get you anywhere. Might as well take up transcendental meditation