[Tasuki]

PP, would you please explain for us the difference between "test" bars and "no supply" bars? Thanks so much, Taz

[TinGull]

You'll usually see a test break into new low ground to "test" an area underneath the previous low. A No Supply bar will usually not break new ground lower than the previous bar.

[jjthetrader]

Originally Posted by ranj »

Hi Pivot,

In terms of profit taking, if I remember correctly, you like to trail your stops just below the low of the last WRB, and let the market take you out as opposed to setting targets.

What is a WRB?

[TinGull]

Wide Range Body (candlestick)

[ranj]

Originally Posted by jjthetrader »

What is a WRB?

Wide Range Body.

Pivot's concept of WRB and long tails, really put all the pieces together for me when applying VSA. It took me one step further than the bootcamp CD did in solidifying the concepts VSA to develope a trading approach.

[TinGull]

ding ding ding! Real time post here.... I have an idea of what I think will happen...what do ya'll think?

[Tasuki]

Originally Posted by TinGull »

You'll usually see a test break into new low ground to "test" an area underneath the previous low. A No Supply bar will usually not break new ground lower than the previous bar.

Actually, TG, if look at the last chart PP posted (permalink #670) you'll see that there are 4 "No Supply" bars listed, and all four of them close below the previous bar.

So, here's my comparison of Test and No Supply:
1) both close lower than the previous bar
2) both occur on volume that's lower than the previous 2 bars
3) both occur at price lows, after or during a period of consolidation

So, the only difference I can see right now between them is that a Test is suppose to close near its highs and a No Supply closes near its lows.

One question I have is how important it is for a Test to dip below support to "Test" new lows. That would seem to make sense, but some examples I've seen here (e.g. permalink #630, a Tradeguider example; permalinks #106 + #166 both from PP) do not stick their noses into new lows, and they still get called Tests. So, maybe the main criteria for a Test are its location (price lows, consolidation) as well as its high close and low volume, with an added benefit being a long shadow dipping below support. Well, that's my best shot at it anyway.

[TinGull]

True...I may be totally wrong...it's happened before. To me, tho, that's what my feeble brain would be looking at for a test vs no supply. Test's I dont think should close lower than the previous bar, though they certainly could close a little lower depending on where the close sits in the range. Tests *should* probe a low into new ground and get bought back up. Just a rejection of lows.

I think a no supply shouldn't close below the low of the previous bar...but that's just me. If I saw a lower volume bar close below the low of the previous bar, even if it's on lighter volume, I still wouldn't be a buyer.