learning to read price action with p/f charts

i thought i would start this thread as a continuation of the thread started on elitetrader by holygrail.an excellent thread and will transfer thoughts to trade2win.
if anybody wants to read up on this ,then go to dorseywright.com or better still buy the jeremy duplessis book "the definitive guide to point and figure"
it is a method of reading price action

a chart to acquaint beginners with their appearance
there is no timescale
chart is of the fste 100.daily data plot

you can see the major support level

so i will look at the latest pricen get a so we can get a feel of what we are looking at and relate it to the latest price action
s & P 500.15 min data plot
price is in a downtrend.we possibly reached an "armageddon" level.the chart is strarting to get bullish.the arrow points to a double-top breakout.but look ,we still have a res level above that if broken makes the chart even more bullish

Hi dentist007,
Always like a thread about P&F!
In your last post you say that the S&P is in a downtrend and, certainly, most people looking at the chart wouldn't argue with you about that. Can you outline how you define uptrend and downtrend in P&F terms please? I'm curious because the horizontal red line you've drawn at 1095.2 shows a breach of the double top (which is why you've drawn it, I presume) and makes the chart bullish, according to Jeremy du P'. In your view, what else needs to happen (if anything) to be able to say that the downtrend is over and that the index is now in an uptrend?
Cheers,
Tim.

a simple way is to draw a trendline after each signal.however,this would then crowd the
chart with too many lines.so then only draw the ones that the price came off a top/bottom.see the ones that were drawn in the chart below
the downtrend is over when there is a breach of the 45 degree trendline,usually with a signal at or near the trendline.so.yes the chart is bullish in a downtrend.bullish,being the lsat double-top signal

we shall start at the very beginning.
the chart is plotting change in price.also renko,kagi,three line break,range charts are doing the same.each type has its own way of presenting the data visually
candlesticks,bar charts,line charts give the price change over a certain time frame
so,by looking at p/f we are studying the change in price,and therefore we can study price action a a guide for future price action
"X" records the unit of price that moves up one tick.this tick value could be £1,$1.50 cents or 1p,or 1 euro.the user fixes what price change he/she wants to look at
"O"records the unit of price when it moves down 1 tick

we look at the daily data plot for google.this chart is bearish
i shall explain more as we go .this is just a feel of what we are looking at

price action ..we are looking at the current price and its relationship to previous prices
there is no time,volume,high ,low or close values.however,these can be superimposed on the chart
we can do this for any tradeable security,even property prices.we then look at the column characteristics and make certain deductions

ok...so we know now that that the user can adjust the box size..this being the increment of price change you want to look at.this will vary according to what instrument you are looking at.so for the dow at 10,000 will have a different box size to the ftse 100 at 5000
remember as price moves up the column is "X" s and as price moves down it is a column of "O"s
an important note......when the column change direction.these are the s/r areas

chart is 15 min data plot of the dow..the box size is 18 points.so when price moves up 18 points from the previous box we add an "X".vice versa if price moves down
this is a 3 box reversal chart.i will talk about that later on