Jump to content

Welcome to the new Traders Laboratory! Please bear with us as we finish the migration over the next few days. If you find any issues, want to leave feedback, get in touch with us, or offer suggestions please post to the Support forum here.

  • Welcome Guests

    Welcome. You are currently viewing the forum as a guest which does not give you access to all the great features at Traders Laboratory such as interacting with members, access to all forums, downloading attachments, and eligibility to win free giveaways. Registration is fast, simple and absolutely free. Create a FREE Traders Laboratory account here.

Recommended Posts

yeah looks like the reason for the rally today was my post yesterday. straight to the moon!

 

So, where are we now? See attached chart. Looks like that was one great call, Waveslider! Good job!

5aa7101c456a9_WolfeWavebullishESdailyTS01.thumb.png.a9aba35a803eafe9dcc7fb2399a5737b.png

Share this post


Link to post
Share on other sites

My feeling is that the flash crash is going to affect this pattern, distorting the 1-4 line target... ,maybe even an overshoot of the target line.. but it does look like the pattern will play out, some cheap calls would be a good way to play it.

Share this post


Link to post
Share on other sites
So target is the upsloping line P1-P4? (or does Wolfe label pivots from zero or with letters, all these different conventions!)

 

Cheers

 

nice, compare this chart to the bottom of pg 123 of Street Smarts book... they are basically identical. buy the reversal with a stop under this low is the trading strategy associated with it.

Share this post


Link to post
Share on other sites

just thought I'd bump the thread as it looks like this target might actually get hit. Amazing the zigs and zags that will trick you along the way.

Certainly the market is show strong resilience even with oscillators peaking and market breadth falling.

Share this post


Link to post
Share on other sites

To all,

See attached. Looks like a near perfect bearish WW setting up on the Dow.

1) pivot 1 in middle of range

2) pivot 2 scared the pants off investors

3) pivots 3 and 4 lulled them to sleep

4) pivot 5 (not sure it's formed yet) will, I trust, give investors (false?) hope

5) target would be somewhere south of 9500

 

Tasuki

5aa71032cb5fd_WolfeWaveonDow.thumb.png.feef556430a503cef5fe631770864db1.png

Share this post


Link to post
Share on other sites

Agree Tasuki!

I like how quickly that 4-5 move is developing - with no hesistations. It does look great.

 

The conflict I see is that the andrews pitchfork target (april high, July low) is still higher - -what do you think?

Share this post


Link to post
Share on other sites

Battle of the Patterns.

See attached charts of Dow and SPY.

Both forks do look bullish (very, actually), but both have met their initial, official objective--the median line. Note too that both forks are pretty steep. The chance of price continuing up to the next objective, the upper medianline parallel, is (IMHO) vanishingly small. So, if they don't meet that lofty goal, what will they do? Fail, of course, but how and when is the question.

 

That Wolfe Wave I drew has a bit further it can go to make pivot 5 before it needs to turn down (for the pattern to work) so we may find that both patterns work, to a degree.

 

Like they say, may you live in interesting times.

 

Tasuki

5aa710334f9c5_Dowfork.thumb.png.4e4123f1491418c53da0db1c99a948f6.png

5aa710335838a_SPYfork.thumb.png.9211d4f0ae329c79fc9dd2d7b910b10f.png

Share this post


Link to post
Share on other sites

you know, I was looking at a bigger scale, maybe weekly chart would demonstrate it better.. sorry my charting is updating right now..

anyway for the pitchfork, point 2 would be the high in april, the low in july. That corresponds more with the original WW identified here months ago..

who knows, but volatility is still on the bullish side.

Share this post


Link to post
Share on other sites

Thanks Suri. Appreciate another perspective adding depth to the possibilities of current patterns. It seems like we are all a little bullish, but don't see this market action holding up for long. The possibility of blasting to new highs hasn't even been discussed... and since it hasn't I would imagine that we're not alone and not many would suspect it. A great motivation for the markets to do just that!

 

Have you had much luck with quantifying and testing patterns like gartley over large and diverse data/timeframes?

It seems like the Gartley patterns are somewhat rare in that they require certain harmonics in their set-ups.

 

waveslider

Share this post


Link to post
Share on other sites

Hello fellow traders, first post. I am not too familiar with Wolfe and waves but it's a good time to start reading about it so thank you for sharing all these charts.

 

On another front, my ultra-simplistic analysis tells me there is staunch support at 9900 dow, 1058 sp and 2130 naz. Staunch as in never having failed in over 10 years. And it has been tested twice already, on 6.27 and again on 8.22. So there you go, my simple view.

Share this post


Link to post
Share on other sites
Thanks Suri. Appreciate another perspective adding depth to the possibilities of current patterns. It seems like we are all a little bullish, but don't see this market action holding up for long. The possibility of blasting to new highs hasn't even been discussed... and since it hasn't I would imagine that we're not alone and not many would suspect it. A great motivation for the markets to do just that!

 

Have you had much luck with quantifying and testing patterns like gartley over large and diverse data/timeframes?

It seems like the Gartley patterns are somewhat rare in that they require certain harmonics in their set-ups.

 

waveslider

 

Hi Waveslider,

 

Thanks for your post...

 

I think the patterns I posted are near Perfect Gartleys and they should reach at least the Pattern Completion Zones (PCZ) marked on the charts. So far with the given X5 (5-point) rules, they fit Gartley Bullish patterns.

 

Currently I am finishing 4th version of Auto-Gartley (X5) detection algorithm. Looks like writing Auto-Gartley algorithms has been my fascination for the past 4-5 years. Once I complete this current version, I'll implement the Automation with new TS 9.0 to test various instruments and time-frames. Every year I build new ideas to write Auto-Gartley and I write it from scratch thinking this is it :) This year I may have a far better algorithm (that's what I thought Last year too :) At least now I have gathered knowledge the type of Gartleys (all 5-point patterns) work and when they fail and what are the pre-requisites etc. My current ABC Pattern detection/trading has been great and I am using that experience to build X5 patterns. ABC pattern is a critical part of all X5-patterns....

 

I'll try to post more X5 patterns soon...

 

Regards,

Suri

Share this post


Link to post
Share on other sites
I still don't get it, the pivot 3-4 from the chart must be in the channel. There is no channel unless 2 lows and 2 highs are made. So 1 & 3 must exist to draw a line, so does 2 & 4. I got this rule from investopedia but does't make sense. I think this pattern is classified are broadening pattern in the classical TA.

 

Torero, google "wolfe wave" to learn the pattern. Technically I would call it a descending wedge.

 

Point 2 is the recent high. Point five is the bar from friday, which penetrated the 1-3 line.

 

The target line is 1-4. Sorry, I should have labeled this chart better.

Share this post


Link to post
Share on other sites

... i am curious as to what kind of gartley patterns these are

... the gartley i am familiar with has a 0.618 as its first retracement.

... and bearish butterfly a 0.786 as its first retracement.

 

...but this has a 50-something % as the first retracement

-------------------------------------------------------------

 

...also.... i don't understand why your expectation is that the pattern will be completed

... i thought that there was a bearish implication if and only if the pattern completes

 

...i have never read anything stating that if the first two retracements were completed.... that that would somehow cause the third retracement to be completed correctly

 

--------------------------------------------------------------------

....please forgive me if i am ignorant about these patterns.

Share this post


Link to post
Share on other sites
... i am curious as to what kind of gartley patterns these are

... the gartley i am familiar with has a 0.618 as its first retracement.

... and bearish butterfly a 0.786 as its first retracement.

 

...but this has a 50-something % as the first retracement

-------------------------------------------------------------

 

...also.... i don't understand why your expectation is that the pattern will be completed

... i thought that there was a bearish implication if and only if the pattern completes

 

...i have never read anything stating that if the first two retracements were completed.... that that would somehow cause the third retracement to be completed correctly

 

--------------------------------------------------------------------

....please forgive me if i am ignorant about these patterns.

 

 

Hi,

 

You do raise very good points.. When H.M. Gartley first wrote, he wrote them as Gartley patterns only. Later Larry Pesavento, Bryce Gilmore, Scott Carney did great work and gave them various ratios and lengths and various pattern names (Crab, Butterfly, Bat, Gartley)...

 

To my knowledge, Scott Carney's work is brilliant regarding the Harmonic Patterns.

All three books from Scott Carney have Harmonic Patterns with great examples.

 

To avoid this massive confusion, I call all of them X5 Patterns signifying 5-point patterns.

Also, for me the position of 'B' and 'D' identifies various form of patterns and tells what to expect. I also have a big poster (self-drawn) with all these patterns on my Trading room wall right above my trading workspace.

 

About B: If the ratio is upto 50% of XA, then it is a Bat with other key ratios. If the ratio is greater than 0.618 and upto 0.786 it may be Crab.. But if ratio is near 0.618 of XA it may be Gartley with lot of combinations of other leg ratios... Very rarely these ratios are precise and if they ever form, they are all called 'Prefect' patterns. I do identify various patterns with these ratios but it is too confusing. Hence, I call them all X5 patterns and focus on how to auto-identify X5 patterns (in code) and look for continuation (CD leg) OR Reversals (from D) to trade.

 

Now Looking at D, if D is within XA it may be Gartley or Bat, but if D is beyond XA range, then it may be Crab or Butterfly. So, knowing this situation, there are TWO targets possible. If Price reverses from D, the reversal is 0.786 to 0.886 of XA (within XA), then it is Gartley or Bat target (and a reversal zone). If Price is from 1.13 to 1.27 of XA then it is Crab or Butterfly target. Hence, I have two areas (targets) for Potential Reversal Zones (PRZ). Price action from these levels shows potential reversal trade setups.

 

I have been studying, building/trading Harmonic Patterns/Harmonic Ratios over 12+ years now along with other patterns and the theory behind them still fascinate me.

 

Hope It answers some of your questions.

 

Regards,

Suri

Edited by suriNotes

Share this post


Link to post
Share on other sites

Suri,

 

Have you ever tried dedicating some programming time to WW? It would be interesting to hear statistics on any of the patterns you detailed above..

 

% patterns completed profitable

average drawdown %

Risk/reward

 

I can see some value in what your are doing, but say at this point where we are right now. Would you be long or short biased?

It seems like there is always a target beyond, and if there is not then a whole new trend might develop that doesn't fit the pattern.

 

I guess my question is, what is it that would give you the confidence to switch to short bias here. Would it be the statistical probability of the patterns you detail?

 

waveslider

Share this post


Link to post
Share on other sites
Suri,

 

Have you ever tried dedicating some programming time to WW? It would be interesting to hear statistics on any of the patterns you detailed above..

 

% patterns completed profitable

average drawdown %

Risk/reward

 

I can see some value in what your are doing, but say at this point where we are right now. Would you be long or short biased?

It seems like there is always a target beyond, and if there is not then a whole new trend might develop that doesn't fit the pattern.

 

I guess my question is, what is it that would give you the confidence to switch to short bias here. Would it be the statistical probability of the patterns you detail?

 

waveslider

 

 

Hi Waveslider,

 

I have never written WolfeWave code... Few times thought of it, but never did.

I do see the confluence of Harmonic Patterns, WW and Pitchforks tools as great trading arsenal. Recently I have been picking some great interest in the Pitchforks... There is not much of WW information in the public domain other than some snippets.

 

I use the Index/Sector Patterns to trade underlying instruments (Equities/Options) and I am still Long on many positions initiated in the last 4-5 weeks. Some of the similar Gartley patterns existed in GE, GS, GOOG already exited the trades.

 

Pattern reversal zones are (only) suggested by the Pattern with target level confluences.

Gartley Pattern itself does not show any Trend reversals, in my view. I use another set of tools (exhaustion, price-action etc.) to determine if the Underlying trend has changed from PRZs. Also, one-day reversals rarely qualify for a Trend-Reversal. I do prefer the reversals from second/third PRZs than from first PRZ.

 

Here is an example of Gartley formation in recent NQ. See the 1990-2020 area... Although Gartley suggested a first PRZ area, it is actually a Distribution area than a

trend-reversal area.

 

Hope I answered your query.

 

 

Regards,

Suri

 

attachment.php?attachmentid=22673&stc=1&d=1287535802

NQ_Oct1910.gif.0c276cae55c0ead194fee10d25b0edd4.gif

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.
Note: Your post will require moderator approval before it will be visible.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.


  • Topics

  • Posts

    • China’s New Cryptocurrency   China plans to release a new digital currency which would bear some similarities to Facebook’s Libra coin. It would be usable across several platforms like WeChat and Alipay.   In a recent interview with the Shanghai Security News on the 6th of September, the deputy director of the People’s Bank of China, Mu Changchun, stated the purposes and the need for the new digital currency. He stated that the central bank needed to evolve from the use of traditional paper currency and delve into electronic payment methods which are making strong advances around the world. He said that the digital currency would be a realistic way to protect monetary sovereignty and legal currency status, stating that this digital currency initiative was a way of planning for a rainy day.   He also mentioned that digital currency would be as safe as the traditional central bank-issued paper notes and that it could even be used without requiring an internet connection. This offline feature is one of its major selling points as monetary transactions can still be carried out even in the face of communication breakdowns resulting from natural disasters like earthquakes, tsunamis and so on.   In 2014, the Chinese central bank set up a research party to explore the possibilities of a China-based digital currency to reduce the costs of producing and circulating paper money, which in turn would boost policymakers’ control over the supply of money.   Information about the development of this new digital currency was unknown to the public until last month when Mu announced that the innovation was almost ready.   US-based financial magazine Forbes has made claims that the currency would be ready by November 11.   Analysts are saying that the announcement made by social media giants, Facebook on the release of its digital coin, Libra, is the reason for the acceleration of the push towards digital currency by the PBoC.   Mu made mention of how the new digital currency would strike a balance between allowing anonymous payments and preventing money-laundering as compared to Libra. Although the Chinese digital currency may bear some resemblances with Libra, it would possess characteristics that even Libra didn’t have.   Facebook’s Libra Facebook’s Libra has sparked a lot of worries among global regulators that it could become the predominant digital payment format and could become a medium for money laundering considering the social media’s wide reach.   Libra is said to be a digital currency that would be backed by several real-world assets, including bank deposits and government securities, and it will be held by a network of stewards. The structure of Libra is predicated on promoting trust and to stabilize its price.   Finally, Mu further discussed the superiority of the digital currency over altcoins was that others could go bankrupt and cause its users huge losses. Thus he said, can never be the case of PBoC’s new currency.   Source: https://learn2.trade         
    • Facebook’s Libra To Apply For Licence In Switzerland   Swiss financial regulators have signaled that Facebook’s cryptocurrency, Libra is mandated to meet up to extra requirements besides acquiring a payment system license before they can begin operations in the region.   In a recent press release, the Swiss Market Supervisory Authority (FINMA) explained that the diverse services projected by Libra have created the need for adding the requirements being imposed. They stated that due to the issuance of payment tokens by Libra, the operations planned by Libra would clearly exceed those of a pure payment system and therefore should be subjected to such extra requirements.   The Extra Regulatory Requirements According to FINMA, the extra requirements would be targeted specifically at liquidity, risk concentration and capital allocation.   The financial regulators of Switzerland have also noted that the management of Libra is another element necessitating the demand for Facebook to meet extra requirements concerning its cryptocurrency initiative.   In the launch of the Libra white paper in June, Facebook noted that the reserve would be controlled by a web of custodians who would be spread across different geographies. The so-called custodians will be mandated to possess an investment-grade credit rating.   Also, Facebook noted that the real assets used to back the Libra cryptocurrency would be a selection of low-risk assets such as bank deposits and government securities.   What Form Will these Extra Libra requirements take?   According to FINMA, the extra regulatory requirements that Libra would have to meet would be nothing different from what other participants in the financial markets have to adhere to.   For example, Libra would be expected to be exposed to certain bank-like rules such as a large simultaneous number of withdrawals of Libra coin by users would have to be palliated by the application of certain bank-like regulatory requirements. This means that Facebook would be required to obtain a banking license. This idea has been pushed for in the past by U.S. President, Donald Trump.   FINMA also mentioned that Libra’s international range will mandate a globally coordinated approach. This new development would drastically delay the launch of the cryptocurrency.   U.S. Pressures Switzerland over Libra Cryptocurrency Switzerland is under intense pressure from the United States to ensure that its cryptocurrency regulations are not prone to misuse. Facebook chose the Central European nation as its hub because of the country’s progressiveness towards FinTech.   According to a report by the Wall Street Journal, officials from Switzerland and U.S. Held a meeting in Switzerland earlier this week, where they discussed matters surrounding the new cryptocurrencies regulations.   The U.S Undersecretary of the Treasury for Terrorism and Financial Intelligence, Sigal Mandelker, emphasized his concerns over the need to have regulations strong enough to fend off bad actors. He mandated that the Swiss handle these concerns with all importance.   Source: https://learn2.trade   
    • I don't agree with you. There are dozens and dozens of brokers that are regulated by the CySEC or FCA.
    • Just one more question. How many real REGULATED crypto BROKERS can we find? Correct, the answer is ZERO!! Please stay away from trading cryptos.
    • EU was stopped for -.5. Current stalk EU
×
×
  • Create New...

Important Information

By using this site, you agree to our Terms of Use.