[monad]

WHY?
Back to your excellent Post 704 and some meaningful and mature discussion, hopefully to continue this thead before folks just walk away in disgust at the pissing contests going on in the last dozen posts.
Would appreciate if you could clarify the following:

"That is; in a bull market it can go up 123, or 4 and 5 and then react or it can go down in a bull market 123 4 or 5 and then react off that. Ditto for bear trends.

1. I have observed that in strong uptrends, there is indeed the first cycle 123 where the SS closes on its High Last. Following this Day4 , Buy Day, there would be a shallow decline or zero decline and off to races which continue on the Day5, Sell day. Then it reacts on the SS day with an ideal short. Is that what you meant when you said in a bull market it can go up 123, or 4 and 5

2. Similar scenario occurs in downtrend or a sell off from congestion, SS ending flat or low Last with BV, followed by Day 4 Buy day which ends flat and further downside on Day 5 Sell day, than on the SS day we have the rally.

[rigel]

Agreed, these useless exchanges regarding whose method is right or wrong is not doing anybody any favours. If somebody wants to modify Taylors method, and is making profit from it, fine,
Discuss in a matured way, no need to force the issue onto somebody else and tell them to go away or throw insults. This thread has been very instructive so far due to input from knowledgeable folks like WHY?, Richbois, Hakuna, Frank who have contributed without asking anything in return and I for one am indeed grateful to them.
And there are many who are trying to learn the methodology as the book is pretty diffcult read and WHY? has gone to a great deal of trouble in countless posts to clarify and it would be a great shame if the thread came to a grinding halt.

URGE SOULTRADER TO SAVE THIS THREAD FROM DISAPPEARING INTO OBLIVION

[WHY?]

Originally Posted by monad »

1. I have observed that in strong uptrends, there is indeed the first cycle 123 where the SS closes on its High Last. Following this Day4 , Buy Day, there would be a shallow decline or zero decline and off to races which continue on the Day5, Sell day. Then it reacts on the SS day with an ideal short. Is that what you meant when you said in a bull market it can go up 123, or 4 and 5

2. Similar scenario occurs in downtrend or a sell off from congestion, SS ending flat or low Last with BV, followed by Day 4 Buy day which ends flat and further downside on Day 5 Sell day, than on the SS day we have the rally.

Taylor is all about "anticipation". You anticipate the ideal cycles and you also anticipate the less than ideal cycles. He has rules that govern both. Actual market action gives you a cue on the the most probable cycle that is unfolding.

In the senario # 1 above you have a less than ideal cycle. Do you play it? Sure. This sort of senario tells you that with the high close on the SS day you are likely to have a shorting opportunity on the next day i.e. the Buy day. However, one can't forget we are in a strong up trend. This being the case you would "anticipate" a shallow decline on that buy day so get ready to cover any short taken very quickly and most likely very early in the session. You also anticipate to go long later in the day (afternoon) on an HB (higher bottom). On buy days a stock that has held a higher bottom all day and it is say within and hour or two off the close (30 minutes even better) then an HB is likely to occur. An HB simply means that the stock held a higher low than the previous days low. HB's only count on the buy day. They are not to be used on other days. Taylor says most HB's made on a buy day are profitable. Of course, they must be held overnight generally speaking. You would look to sell the long HB taken the next day of the cycle i.e. the sell day. One could even wait for the next SS day to sell it but usually it is best to sell the HB the very next day.

In summary, the cycle has continued intact. The way you played it was different that playing the ideal cycle. You anticipated a less than ideal cycle cycle coming up because of 1) the strong uptrend 2) the high close on the previous SS day. Usually, when the market has that extra beat or two on the way up you get these HB's more often. It has that extra beat because of the strong uptrend. Again, many 3 day cycles take place in uptrends or downtrends. Some are ideal and some are less than ideal cycles. Rules govern both. You are always anticpating the cycle. While observing actual market action you must always be asking yourself is it an ideal cycle unfolding here or is it a less than ideal cycle? Your tactic for the day depends on the actual cycle that unfolds. This business of flipping the cycle to try and make it fit an ideal cycle only confuses and wrecks havoc with Taylors rules. I have for years toyed around with tweaking Taylor. I have found very few circumstances where it is even a possibility to rephase the cycle and still play by the rules or reap much benefit from doing so.

Senario # 2 above is what you want to see for an ideal cycle setup if not in a strong downtrend. If it is a strong downtrend then the low close on the SS Day gives more weight to the next day (buy day) making a lower low than the SS day. However, that is NOT a BV. BV's ONLY occurr on sell days. The flat close on the buy day is a very strong implication of a BV taking place the next day i.e. the sell day. BV's are for taking long positions and are counter trend trading. You are actually trading against the longer term trend using Taylors rules. So, how do you play senario 2 above?

Well, the weak close on the SS day and the longer term downtrend indicates, of course, weakness. So, you are anticipating a failure on the buy day for the high to penetrate the high of the precious day (the SS day). One could short a weaker high on the buy IF and ONLY if it is made early in the session. If it then closes weak on the buy day one could look at holding the short over night (the longer term downtrend puts the probabilities in your favor the decline will continue down on the next day). So does the weak close on the buy day. So, I would look at holding the short overnight and covering on the next day (sell day) then reversing on a BV (a buying day violation...this occurs when the price very early in the session of the sell day trades under the low of the precvious buy day). So I would be long on the BV (i.e. I am taking a counter trend trade). What is my selling objective? I would try and sell my long the SAME buy day at or just under the low of the previous day (i.e. the buy day). One can't afford to follow the long position up very far because the general trend is down.

In summary, the weak close the SS day and the weak close the buy day helped me to anticipate a weak high on the buy day and a possible shorting opportunity to be held over night which is confirmed by the weak close on the buy day. Together the weak close on the SS day and the weak close on the buy day and the longer term downtrend, all three added together, helps me to anticipate a possible BV being made on the next day (sell day) and thus gives me an opportunity of reversing from my short position and taking a long position counter trend trade. You will find several BV opportunities in strong longer term downtrends. The cycle stay intact. How you trade it is what changes. I think Rich Bois has already told us that in a previous post. The longer term downtrend creates those extra beats in the rhythm that Taylor talks about.

[WHY?]

Remember also in a bull market you can not only get 123...4...5 but also get a short-term correction in the bull market that actually unfolds as a 3 day cycle (as shorter term down trend) even creating a BV on the sell day! Again the cycle stays intact but because it is a bull market in a correction you play it as less than ideal cycles and must be very careful shorting these senarios as it remains a BULL market (it is only in a correction). Ideal cycles are found more in sideways markets. Does this make any sense??

[elovemer]

... a buy day today ... has not taken out last low made first.... yet
... others may have different counts...

... and others surely have different "CYCLES" ;0)

[monad]

Originally Posted by WHY? »

Remember also in a bull market you can not only get 123...4...5 but also get a short-term correction in the bull market that actually unfolds as a 3 day cycle (as shorter term down trend) even creating a BV on the sell day! Again the cycle stays intact but because it is a bull market in a correction you play it as less than ideal cycles and must be very careful shorting these senarios as it remains a BULL market (it is only in a correction). Ideal cycles are found more in sideways markets. Does this make any sense??

Great elaboration on the essence of Taylor Methodology and clarification of ideal and not-ideal cycles., highly appreciated.

Today continuing with our count is Buy day, perhaps you can view ES and make some comments.

[thalestrader]

Originally Posted by elovemer »

.... you want to turn TL into ET... go ahead....

...WHY if you want to discuss how your interpretation of Taylor's writing with differs with mine... you should PM me....
... this forum is not the place for a pissing match...
....otherwise... focus on your own methods....

I am a long time Taylor trader, and I have lurked this thread since its inception. If I may make a suggestion that may please both yourself as well as the other participants in this thread - perhaps you could start a new thread called "Taylor According to Elovemer," and then you can post all you want to concerning your interpretation of Taylor. I really want to remain positive here at TL, and I agree with you - we do not need to see TL turn into ET. In that spirit, why not start your own thread where you can highlight your own use of Taylor.

Best Wishes,

Thales

[HAL9000]

... just do it ...

... its ... better ...

Hal


P.S.: Sorry but I am in the mood, WHY has her/his analytic mode, very clean and helpful,
but as I use ... myself sometimes, your (elo...) use of it, just avoids complete sentences.
But for analytic purposes, even a complete sentence might lack syntax and/or semantic.
But ...

Anyway, I don't like to read the word "pi**ed" so often.

Yes, I also go hunting from time to time, but ...

So please: PEACE