wot happened next? no:2

Thought I’d do the next one as a new thread since the first one got a bit derailed .

With a different slant, this one again centres on the price action after a high volume, long candle event (promise something entirely different next time :cheesy: ). As I said before, these events are often followed by a move (open to close) in the opposite direction the next day. Traders planning for that would likely have gone short as the price fell back through the open the next day, if not before. Anyway, that’s all a bit bye the bye.

In this one the price had been steadily rising for some time and every high you can see on the way up was an all time high. After the hvlc event the price tried for more but fell back. It continued to fall day by day until we arrive at the cut off point where a hammer type near doji prints at the base of the long candle.

So wot happened next? And, more importantly, what trade might you be anticipating, with what entry, with what target in mind and with what stop?

Over to you - full chart comes Tuesday evening.

good trading

jon

Hail To The Moderator

Did not see the first wot happens next (see edit) so do not know the type of replies you are expecting, however........

Price has fallen to support during last day but closed up on the day, therefore probability that the price will rise to resistance. It may touch support again before the upward move. I would go long with target at resistance but would hold the trade open to see if price was going to breakout Stoploss just under support or at a distance calculated from the daily price range.

Now barjon you can show the ongoing chart and take perverse pleasure from my discomfort at seeing the price plunge !

EDIT: I just happened to see the first one in this series ! Oh dear what have you let me in for barjon and I thought you were a friend. Those of you who think that my post is wide of the mark please treat me gently.

Regards

bracke

Go on Mr M just once more!

Even Elvis has been seen a few times since he left the building in 1977. :cheesy:

You have permission to start your retirement after Monday..................

barjon said:

Thought I’d do the next one as a new thread since the first one got a bit derailed .

With a different slant, this one again centres on the price action after a high volume, long candle event (promise something entirely different next time :cheesy: ). As I said before, these events are often followed by a move (open to close) in the opposite direction the next day. Traders planning for that would likely have gone short as the price fell back through the open the next day, if not before. Anyway, that’s all a bit bye the bye.

In this one the price had been steadily rising for some time and every high you can see on the way up was an all time high. After the hvlc event the price tried for more but fell back. It continued to fall day by day until we arrive at the cut off point where a hammer type near doji prints at the base of the long candle.

So wot happened next? And, more importantly, what trade might you be anticipating, with what entry, with what target in mind and with what stop?

Over to you - full chart comes Tuesday evening.

good trading

jon

Click to expand...

Hi Jon,

I am using a simple 123 setup for this. If it's wrong, then, I ain't taking any more notice of the Ross clique

If I had been following this share, I would have shorted at my bottom line (2), with a stop at (3), so I would, now, already be in a short position.
However, I'd be watching the support levels lower down, hoping that they would not hold and ready to get out if they do.(1), of course, is at the peak.

If I'm right will I get a guru's badge?

Split

mr.marcus said:

.....to conclude ,believe it or not this is just a snapshot of what is there.i would like to add that every bar tells a story and withing every bar also a story and so on.there is no such thing as noise,just a lack of understanding.this is also no such thing as an uninteresting bar,again lack of comprehension.volume and price are what they are ,they work symbiotic-ally,cant have one without the other.volume can lead price ,this can be self fulling,lot of people looking for them spikes...but mainly price creates volume.but of course understanding volume,who,why and how,the battles,the exchanges,the manipulations ..all attached to the price movement...can help you to see the probably scenarios before they occur....then the price and volume merely confirm your already probable conclusions.when people tell you to wait for a lower high etc ..at a top...their basically asking for more confirmation...and what their saying is t personally they need more information..more confirmation because they dont understand the market well enough to take it earlier.the more you comprehend others actions .. even before they do.the sooner you can take a signal and maximise your profit ..with no greater risk.risk is inverse to market knowledge.there is no substitute for knowledge...and no substitute for hard work and endeavour which will take you there.the market cannot be formalised,know yourself .know others and do your best to remain humble even when success comes.for if you dont an almighty fall is just around the corner.

Click to expand...

I hope that isn't a sign-off Mark.

Your post has so far gone unremarked which is remarkable. Or perhaps not.

Jon's intent to generate technical analysis commentary on example charts is a fine one. And I'll add my 2p-th after this post. fwiw.

But I am genuinely impressed with the points you made in your final paragraph. Stated simply, and concisely. And so far away from the minutiae of the TA we ostensibly discuss here (on these boards) and on this thread specifically that it will, I suspect, sadly, for that very reason, bypass the conscious awareness of many.

I hope it wasn't an epitaph, but if it is to be, then it's a good one.

cor, a tricksy one this, Jon.

Now, from a completely non-technical and more psychological point of view...

As you put a bull chart up last time, this time I'd say you've put a bear chart up , so the price will sell off. But, as you're a clever fellow, you might have anticipated this response, and double-crossed us all by putting another bull chart up. Or, you might have..... etc etc..

tee hee hee

Ahead of these evening disclosure by Jon, I'll go in with the following:-

The sharp one-day move up (long candle) and relatively large (relative to daily ranges prior to long candle) range over the next few days coming back down to base of long candle means a lot of energy (and pain) has gone into this instrument.

Even if it does break back up and through the most recent resistance (set by that long candle - not the subsequent higher high candle), the volume profile over that section indicates not lacklustre support for a move higher, just general lacklustre-ness (?). I does not auger well for any sustained (drawn out) move higher. It does possibly portend a potentially dynamic (high energy) move higher.

A move lower is also possible. Whether this would be a major sell-off or just a drift lower as reversal is confirmed (falls below base of long candle and re-test positive as new resistance) will be determined by action over the next 10 bars. Selling has been in evidence by the slightly increased level of volume on the post long bar downward move. But it appears 'controlled' selling. Sucking up weak longs that got on board during the slow uphill slog prior to the long candle.

So, based on this chart alone I wouldn't be making any plans to trade what I suspect is more likely than not to be a fast and dynamic move or no real move at all. It also makes me uncomfortable looking at just the one timeframe, even if it is a relatively relaxed Daily - like tying one hand behind your back.

I reserve the right to come back and edit this post once Jon has posted the 'what happened next' bit tonight. Or I might just delete it to avoid confusion (being found out... ).

rossored said:

cor, a tricksy one this, Jon.

Now, from a completely non-technical and more psychological point of view...

As you put a bull chart up last time, this time I'd say you've put a bear chart up , so the price will sell off. But, as you're a clever fellow, you might have anticipated this response, and double-crossed us all by putting another bull chart up. Or, you might have..... etc etc..

tee hee hee

Click to expand...

...but then he be thinking you'd be thinking that...

mrmarcus... awesome post. thank you.

Eye, seconded, excellent information and understanding Mr M (as usual).

A magnificent analysis, mr.marcus.
Everyone should learn how to use their own grey stuff between the ears like you do.
Of course, this is a common pattern which can be spotted on sight. Here is a live one from this very moment ;-)
Richard

Wow, not surprising that there were only a couple of brave souls after Mr.Marcus’ master class. I hope everyone has locked that post away in a fireproof safe with other priceless jewels.

Mark, you take my breath away (again). The price progressed (and is progressing) as you anticipated albeit that the initial bounces were a bit higher and we didn’t get the inverted head and shoulders. Anyone who cares to call up a longer term chart will see that your reverse engineering was pretty much on the spot too. Your conclusion about the hvlc event that there was news - yes, the budget - and a key level - yes, £20 and smack on the blue line you drew, too. Wow, indeed.

Another master of the markets contacted me to say that the time for a trade had long past - it was the short when the price backed off the day after the hvlc event.

Faced with those big guns maybe I shouldn’t say anymore but, what the hell, us numpties can make a few bob, too, if we’re careful.

As I see it, there was a confluence of technicals at the cut off point. The support of the bottom of the long candle had held, that level was about co-incident with a 50% retracement and the hammer type near-doji was an indecision/reversal candle. All that seems to favour a long with entry above the doji high, a target at the mid-point of the long candle which might offer resistance and a stop below the doji low. It didn’t quite make the target and when that shooting star type doji appeared it signalled a rush for the exit when its low went - still a near 60 point trade though. Then a repeat, but less convincing, dose on the second bounce.

mmm

good trading

jon

Racer,
People see what they want to see and disregard the rest.........mr.marcus must have spent a lot of time working on and writing that post. It wasn't for his benefit, he's a real trader and can see things; a pure unselfish act, with only a few expressions of appreciation. Most people want some system, some Holy Grail, some paint by numbers method. They don't want to UNDERSTAND the market or sentiment or THINK and that post required effort and thought and time to read. I would guess the attention span of many would inhibit them from reading such a long post.
Richard

Racer, MrC

I think you do many members a disservice since I'm sure that anyone who reads Mr.Marcus' post can't fail to be impressed. What Mark offered is so far above the level the vast majority even aspire to, let alone achieve, that it is difficult to appreciate properly. In that sense it's like asking why a class of ten-year-olds don't seem to have properly appreciated a lecture from Einstein on relativity.

It also comes as something of a shock to realise that you're only ten-years-old when you thought you were nearly grown up . And I speak as a ten-year-old (well, maybe eleven

good trading

jon

barjon said:

What Mark offered is so far above the level the vast majority even aspire to, let alone achieve, that it is difficult to appreciate properly. In that sense it's like asking why a class of ten-year-olds don't seem to have properly appreciated a lecture from Einstein on relativity.

It also comes as something of a shock to realise that you're only ten-years-old when you thought you were nearly grown up . And I speak as a ten-year-old (well, maybe eleven

Click to expand...

Jon,
My thoughts precisely. Only I'm in a class or two below you, so think how I must feel!
Even having printed out mr. m's chart in order to refer to it easily while reading his post, I struggled to follow the narrative. I am in awe of mr. m' for such a stunning piece of work and in sympathy for any members who now feel as I do, that the mountain climb ahead has just got a whole lot harder and steeper.

Tim.

Jon,
I guess what I am saying is that,
a) When someone provides real quality work like mr. marcus, it is only polite to say thank you,
b) the other reason why so few have is because there is a tendency to expect simple glib answers and REAL analysis is too much bother for many, obviously not all.
I have to say I'm with Racer on this one, especially with her comments in post # 18.
Some of us do not like ego - inflating arrogance, something quite distinct from enthusiasm. And we have eyes to see......
Richard

the reputation system means we can pass on our appreciation and comments to the poster without necessarily cluttering up the thread with "good post!" posts.

I didnt have anything constructive to add to this thread, but i did think it was a great post and I said so in a rep comment.

Arbitrageur said:

the reputation system means we can pass on our appreciation and comments to the poster without necessarily cluttering up the thread with "good post!" posts.

I didnt have anything constructive to add to this thread, but i did think it was a great post and I said so in a rep comment.

Click to expand...

Quite so, arb - and we do seem to have drifted off topic again. Where's a moderator when you need one

good trading

jon

=barjon
..............................................As I see it, there was a confluence of technicals at the cut off point. The support of the bottom of the long candle had held, that level was about co-incident with a 50% retracement and the hammer type near-doji was an indecision/reversal candle. All that seems to favour a long with entry above the doji high, a target at the mid-point of the long candle which might offer resistance and a stop below the doji low. It didn’t quite make the target and when that shooting star type doji appeared it signalled a rush for the exit when its low went - still a near 60 point trade though. Then a repeat, but less convincing, dose on the second bounce.

mmm

good trading

jon

Click to expand...

fwiw i thought it might be useful to expand on this a little.

It is often the case that long candles give support (resistance) at the mid-point of the real body or at the bottom (top) of the entire candle including any shadow. In this instance it is interesting that, with the mid-point broken, that mid-point offered resistance to the bounces - support becomes resistance.

Quite why mid-points (and Fib50%) often work is a bit of a mystery but I guess it's because it's the point where buyers (demand) and sellers (supply) should be in balance on the past perception of "value" and an area watched closely. If those perceptions have gone up a notch or two buyers will still outnumber sellers at this point and the watchers identify that. The crude thumbnail attempts to show the first part of this - at 100 there is no demand (no buyers) and all the 80 traders want to sell; at 50 everyone wants to buy and nobody to sell; at 80 there'd be 30 buyers and 50 sellers........if that all makes any sense

In passing - at the 100 level everyone wants to sell but, since there are no buyers, there's no trading and therefore no volume -mmm

Last point is the hammer type near doji. Such candles are often talked about as reversal candles - they are not. Whilst they might signal that the trend preceding them may change they do require confirmation. Thus "wait and see".

good trading

jon

barjon

I shall not comment on your 'candles as indicators approach' you may remember that we have been there before, although I do appreciate that age dulls the memory.

I don't know how many people read the Mr Marcus post or how many were interested. I was somewhat taken aback when I saw it as it is unusually to see such a comprehensive analysis on these threads.

I have printed out the post and chart and I am gradually working my way through the analysis. I suspect that any 5 - 10 year olds who are interested in the approach shown by Mr Marcus are still taking it all in. If the method is of interest then his post is invaluable and I very much thank him for it, if it is of little interest then so be it, find another method that is.

I understand that Mr Marcus is to cease posting; what a pity. From a purely selfish point of view I would be delighted to read his analysis of other charts.

Regards

bracke