[dandxg]

Sledge and others, I don't have microsoft paint to mark up chart so I apologize, maybe this will help. If you look at this diagram of a wyckoff trading range with the jump the creek, it's the exact inverse of your short. http://bigpicture.typepad.com/commen...ff_spring.html

A better diagram of the same thing is on page 4 out of 12 on Wyckoff buy and sell tests.

You shorted at #1 or 2 whereas Sebastian, using different VSA terms, would recommend you sell at # 12 or 14. Remember it would be the inverse of this diagram. I hope this makes sense. Maybe nice DB Phoenix can post a chart with a more clearer example of what I am attempting to show you in the inverse? I really need to get paint and figure out how to post charts. It's much safer to buy or sell a pullback once it break out of the trading range on lesser volume. The problem with buying or selling so early in the range is that you don't have any confirmation of the range. Also, and I need to get this myself, Jack Huston Charting the Stock Market the Wyckoff Way shows you how to use Wyckoff point and figure to determine the possible max move and were a stop should be. I also attached some documents that come from well respected Wyckoff experts like Hank Pruden and Jim Forte. I hope it helps.

[mister ed]

dandxg - instead of Paint (which comes with Windows, you sure you don't have it?) you can try Snagit ... I will hunt down a free download link and post it ... it is like Paint but has more funtionality, still very easy to use though.


OK, Snagit is available from here

It is version 7, which is not the up-to-date version but is still outstandingly good.

The registration key code is:
YW6RC-4YMK6-SZBBD-C2MCW-Q9D96

[DbPhoenix]

Originally Posted by dandxg »

Sledge and others, I don't have microsoft paint to mark up chart so I apologize, maybe this will help. If you look at this diagram of a wyckoff trading range with the jump the creek, it's the exact inverse of your short. http://bigpicture.typepad.com/commen...ff_spring.html

A better diagram of the same thing is on page 4 out of 12 on Wyckoff buy and sell tests.

You shorted at #1 or 2 whereas Sebastian, using different VSA terms, would recommend you sell at # 12 or 14. Remember it would be the inverse of this diagram. I hope this makes sense. Maybe nice DB Phoenix can post a chart with a more clearer example of what I am attempting to show you in the inverse? I really need to get paint and figure out how to post charts. It's much safer to buy or sell a pullback once it break out of the trading range on lesser volume. The problem with buying or selling so early in the range is that you don't have any confirmation of the range. Also, and I need to get this myself, Jack Huston Charting the Stock Market the Wyckoff Way shows you how to use Wyckoff point and figure to determine the possible max move and were a stop should be. I also attached some documents that come from well respected Wyckoff experts like Hank Pruden and Jim Forte. I hope it helps.

I'm not ignoring you. I have a very difficult time dealing with all the layers and layers of overcomplication and nonsense jargon that have been laid over what are essentially basic and really very simple concepts. Wyckoff founded the SMI in Phoenix? Wyckoff died in 1934.

But to refute all of the inaccuracies would take dozens of posts, if not hundreds, and would accomplish nothing in the end. I prefer to stick to the basics because that's the quickest route to understanding price action (does it really help to call support "ice"?). And the basics are, to me, Wyckoff's work, not what's said about it.

So, put in the simplest way I know how, you are at what is for the moment the end of a nearly three-month downtrend, ending at where price was more or less a year ago. This is not a stock. This is not a commodity. Is it more probable that price will rise from this consolidation or that it will suddenly plunge to a new 52-week low? Given the repeated tests of 1.94 and the sharp rally off that level on the 21st, I'd be more likely to go long at a break through resistance. If I were to short this instead, I'd be prepared to SAR at the first sign of such a break.

But I don't trade this, and what I would or wouldn't do is not particularly relevant. But I do urge those who want to internalize all of this stuff to get past the bars and past all the jargon and past all the diagrams. It's all about imbalances between buying pressure and selling pressure. Understand that and you'll have it.

[dandxg]

Thanks Mister Ed, I totally forgot I had Snag It, as I have never used it or posted a chart. Hope this comes out ok.

Sell this No Demand. It a nice pullback on lower volume after it breaks the trading range area of distribution. The only downside is that it is a level close not higher, but the volume decrease is major over the previous 2 bars and it's a narrow range so I would sell at close with a stop 2 ticks above the high. It also makes a higher high but close way off the high, bonus sign of weakness.

[dandxg]

Here is a better example. You can't see, this is more of a pure VSA approach, but the volume is slightly less than the previous 2, makes a higher close, and the range if pretty narrow. This is a better example as it shows a double top, both of which at upthrusts. It would sell this no demand bar.

[dandxg]

Originally Posted by DbPhoenix »

I'm not ignoring you. I have a very difficult time dealing with all the layers and layers of overcomplication and nonsense jargon that have been laid over what are essentially basic and really very simple concepts. Wyckoff founded the SMI in Phoenix? Wyckoff died in 1934.

But to refute all of the inaccuracies would take dozens of posts, if not hundreds, and would accomplish nothing in the end. I prefer to stick to the basics because that's the quickest route to understanding price action (does it really help to call support "ice"?). And the basics are, to me, Wyckoff's work, not what's said about it.

So, put in the simplest way I know how, you are at what is for the moment the end of a nearly three-month downtrend, ending at where price was more or less a year ago. This is not a stock. This is not a commodity. Is it more probable that price will rise from this consolidation or that it will suddenly plunge to a new 52-week low? Given the repeated tests of 1.94 and the sharp rally off that level on the 21st, I'd be more likely to go long at a break through resistance. If I were to short this instead, I'd be prepared to SAR at the first sign of such a break.

But I don't trade this, and what I would or wouldn't do is not particularly relevant. But I do urge those who want to internalize all of this stuff to get past the bars and past all the jargon and past all the diagrams. It's all about imbalances between buying pressure and selling pressure. Understand that and you'll have it.

Sure you are correct. We both know you know more than I. Heck I learned from you. It was the best diagram I could find at the moment. I think it was Robert Evans that founded SMI, not that it matters. I agree it's nothing more than support ( ice ) and the resistance ( creek ).

[DbPhoenix]

Originally Posted by dandxg »

Sure you are correct. We both know you know more than I. Heck I learned from you. It was the best diagram I could find at the moment. I think it was Robert Evans that founded SMI, not that it matters. I agree it's nothing more than support ( ice ) and the resistance ( creek ).

Don't misunderstand me. It's not a matter of knowing more but of being sensitive to bull****, and I've always been unusually sensitive in that respect. And though VSA does tend to lay on the jargon a bit heavy, it's simplicity itself compared to what SMI has done.

Price, volume, support, resistance, demand (or buying pressure), supply (or selling pressure), trend. Simple. Basic.

[Tasuki]

I've been thinking about two of the major threads on Traders Lab---VSA and MP, and it occurs to me that they rely on contradictory principles. If you believe VSA, the market is manipulated by the "professionals", "specialists", the "big money." Several contributors to the VSA thread have even opined that, if you get right down to it, this manipulation means that the markets are not a true auction, because it s rigged. Some voices, such as Richard Ney, Joel Pozen and others, are more strident in their opinions than others, but the fundamental philosophy of VSA is that the big players drag the price up and down to suit their needs.

This philosophy is diametrically opposed to the philosophy of Market Profile, whose principles rely on the notion of a fair, two-sided auctioning process. If that process is not fair, if the auction is rigged, then Market Profile strategies would not work. The whole notion of "value" would be a sham if it were rigged by professionals who would be manipulating value to suit their interests.

Let's take a single example to illustrate the two differeing approaches to the market. In a recent video with Joel Pozen, he showed a downtrend with a slight retracement in the middle. In other words,the market went down, then rallied slightly, then went down again. Joel insisted that the slight uptrend was created, manufactured, by the specialists in order to fool the masses into going long, so that the specialists could take out even more people's stops and create another, deeper downtrend. Frankly, I found this conspiracy theory too damn far-fetched for my liking. so I was delighted when I read Dalton's explanation of the same phenomenon (Markets in Profile, p. 155). He simply said that the slight uptrend was caused by "weak sellers" who covered their positions after they had realized a small profit from the initial downtrend. Personally, I find this explanation far more satisfying, not to mention plausible.

In short, the more I study Market Profile, and the mechanisms of the auction process, the less need I feel to explain market moves with conspiracy theories involving super-rich, super-intelligent professionals or specialists. Tom Willaims and Richard Ney and Joel Pozen notwithstanding, I doubt that the folks who manage millions or billions are any smarter than we are. True, there certainly are very rich market players, but Willams and company lump these folks all into one camp and call them "professionals". The fact of the matter is, they do NOT act as one block. The truth is, these guys hate each others guts and are just as much interested in cutting each others throats as they are in screwing the public. This notion that the professionals are taking the market up or down or sideways supposes that these folks all work together. Sure, within one brokerage or hedge fund, I'm sure their traders all work together, but the idea that Goldman and Merrill and Blackstone and whomever else are all working together to move the market is a fantasy conjured up by paranoid conspiracy theorists. The fact is, the auction process has far more logical explanations for the market's moves.