Getting to Grips with DbP/Wyckoff

[barjon]

Yes, the previous downtrend is broken, but whatever long there may have been is "long gone". Therefore, one has to start afresh with what occurs after the gap, and there is nothing in your chart other than a short.

As for a "straight try", if one modifies the SLA or uses only elements of it, then he must essentially start over, which is why I included Developing A Plan in the book. There are, for example, no channels here, so attempting to trade off what one believes are channels amounts to more or less a random trade.

As for "two failures in a row", perhaps there should have been no failures at all. I don't know what you're looking at so I can't say.

Yes, I appreciate all that.

I was probably too hooked on looking for a long rather than properly considering context which I had covered in the prep.

As it transpires so far the hinge is the key factor (as you warned) and I did mention it in the prep on the daily only to ignore it from then on.

Would you say that the hinge was broken on Friday and that it is no co-incidence that the high of today so far retreated from around the apex of that hinge.

Whilst hindsight is a wonderful thing I could (should) have been aware of that and more inclined to look for a short from the apex area than chase a long. Particularly as I kept concluding that the LOLR was down and thus any long would have been countertrend which is not the best place to trade.

 

[barjon]

The other main point I mentioned in the prep was the key support zone.

Here we are in a range for over 3 hours that sits right on the top level of that support zone without me noticing.

What's the point of prep if you just ignore it

 

[dbphoenix]

Would you say that the hinge was broken on Friday and that it is no co-incidence that the high of today so far retreated from around the apex of that hinge.

One could argue that it was broken, but there was no entry opportunity for a short before the market closed, and given that the close from Friday to Sunday constitutes a gap, I would counsel no trade.

A hinge has a mean just as a range does. Until price begins trending, one has to trade the range. As I point out in Appendix A, trading a hinge as a range presents special challenges as the upper and lower limits converge. Unless one is scalping, it's best to wait until all of this is resolved.

 

[barjon]

OK, mistakes and lessons of the day (this may take some time )

1. Ignored context

Having spent a lot of time in preparation work establishing context - the most important in order being hinge; LOLR; and support zone - I then forgot about it when it came to trading.

Lesson: Keep checking back to context and seeing action from that perspective

2. Fixated view and impatience

Having finished the prep by saying I'd be looking long after a break of the downtrend - in itself a countertrend decision that was pretty suspect in light of the context - all I thought about was long and was far to impatient to get going.

Lesson: As lesson above and wait for the story to unfold in respect of context.

3. Ignored the rules

Although, as DbP pointed out, the gap meant I was not trading SLA I did plan to follow the entry and exit rules. My first long had an initial protective stop under the assumed swing low and I stuck with that after the short uptrend was broken - where I had planned to exit. This was not only contrary to the rule I had set myself but, in light of the price action after entry - failure to make a new high and a fast retreat from the attempt - it was a poor decision that owed more to hope and wanting to stay with the trade just to be in it than anything. Cost me 3 times as many points as it should have done.

Lesson: Discipline, please

 

[dbphoenix]

You may want to read "The Mind Game" again. There's a reason why it's first.

Pay particular attention to the introduction on p. 4. After all these years, I still return to this periodically, even though I wrote it. Not much point in keeping a journal if one never looks at it.

 

[dbphoenix]

May also be worth checking in with one's neighbors:

 

[barjon]

You may want to read "The Mind Game" again. There's a reason why it's first.

Pay particular attention to the introduction on p. 4. After all these years, I still return to this periodically, even though I wrote it. Not much point in keeping a journal if one never looks at it.

Yeah, I'm generally not too bad - rather less so when I stray outside my well trodden path

 

[Splitlink]

Good moning Barjon and db.

I said that I would stick to the new hourly channel, although db warned against using channels lower than daily TFs.. Like you, though, I got sidetracked.but we both had different directions. It looks, this morning as it I should have stayed in long mode. The hourly did fan down a bit during the day. I think that that fanning confused both of us, even though we had different directions! At present, I see my position in a countertrade spot, near my top channel line.

Apart from that, the range was considerable, yesterday, makung good profits possible

 

[barjon]

Hi Split - nice to see you here

I didn't trade today. There nearest I could come to the overnight futures was the SB FTSE quote where the long range extended then burst into life about 7am (futures opening). The acceleration in the up trend from 8am exactly paralleled the real FTSE.

The context of a long tight range sitting on support made it seem reasonable to have considered a long LOLR (albeit short term) after the upward break.

Anyway, assuming that is regarded as a valid trading opportunity, then a strict application of the rules would have looked something like this. Maybe all drawn up after the event, but it obeys the rules without any bending or "best fitting". I've not had the temerity to suggest one might have taken the range breakout itself and gained the initial 80 points or so!!

 

[barjon]

:idea: I was looking at TSCO recently. It traded 23 million shares over the day with 8 million of those after the closing bell in the post market auction at or around the eventual closing price.

If volume (activity) is a key component in Wyckoff (not SLA) then isn't the closing price area more significant than any other level TSCO traded at during the day?

 

[Gring0]

If volume (activity) is a key component in Wyckoff (not SLA) then isn't the closing price area more significant than any other level TSCO traded at during the day?

The the original W course the charts don't have opening prices. I pay lesser attention to volume and more on which side is has the upper hand. Dropping price means supply is stronger and rising price that demand is. It must be noted that in many cases by the time next day comes around the opposite of what seemed inferred from those closing moves . Futures though in after hours do seem to show the change in stride. Stocks due to the close become inert and lose their blood song.

Gringo

 

[barjon]

The the original W course the charts don't have opening prices. I pay lesser attention to volume and more on which side is has the upper hand. Dropping price means supply is stronger and rising price that demand is. It must be noted that in many cases by the time next day comes around the opposite of what seemed inferred from those closing moves . Futures though in after hours do seem to show the change in stride. Stocks due to the close become inert and lose their blood song.

Gringo

Thx, gringo

 

[barjon]

No trading for a bit I'm afraid - the latest load of meds has turned me into a zombie.

 

[Splitlink]

No trading for a bit I'm afraid - the latest load of meds has turned me into a zombie.

Get well soon, mate. I had a cataract out last week.

 

[Lajax]

Hi Split - nice to see you here

I didn't trade today. There nearest I could come to the overnight futures was the SB FTSE quote where the long range extended then burst into life about 7am (futures opening). The acceleration in the up trend from 8am exactly paralleled the real FTSE.

The context of a long tight range sitting on support made it seem reasonable to have considered a long LOLR (albeit short term) after the upward break.

Anyway, assuming that is regarded as a valid trading opportunity, then a strict application of the rules would have looked something like this. Maybe all drawn up after the event, but it obeys the rules without any bending or "best fitting". I've not had the temerity to suggest one might have taken the range breakout itself and gained the initial 80 points or so!!

Hi, barjon.

Sorry for been an intruder in your thread But I could not resist to post my point of view about this chart is very similar to yours but I think is always good to share Point of views (BTW my first post here :clap

 

[Splitlink]

Hi, barjon.

Sorry for been an intruder in your thread But I could not resist to post my point of view about this chart is very similar to yours but I think is always good to share Point of views (BTW my first post here :clap

Barjon has been away this week on medication. He'll be glad that you posted. Be patient, he'll be back any time-

 

[barjon]

Yeah, thx split and thx for posting Lajax - still on sidelines and total zombie

 

[tar]

Get well Jon ...

 

[barjon]

Get well Jon ...

thx tar

 

[barjon]

Clearer head today - off and on

Here's analysis of TESCO although I don't really see a trading opportunity vis SLA at the end just yet. Mind you, if I can't get the hindsight analysis correctly then taking it forward in real time is likely to be useless.

Couple of missed things on the weekly - the climax lows touched on monthly comments is more obvious? The trend line is drawn on the weekly and can't be fanned since no new low. The lumps and bumps therefore cause difficulty.

Don't know what happened to the chart headers - they run monthly, weekly, daily, hourly and M5.