If a person begins to think objectively, he starts with almost nothing and define each addition he makes to the system of the operation of the markets. By looking at the two simple parts of a market cycle, a person sees that each part has four obvious points and one not obvious point. Each parallelogram has three points and a FAILURE which ends the parallelogram. The point that is not obvious is the end of overlap of the parallelograms. It is about here where most potential traders stop thinking about how the system of operation of the market works. Most people look for what may be seen over and over and they name the happenings edges. They stay sidelined as price changes as the market makes its offer. All persons see things happening. To look at the system of the operation of the market, it is best to consider the order of events of what happens. "The Pattern" contains the ingredients and the elements.
By spending time looking at the cycle of trading in the dependent variable it is possible for some people the consider the basic operations in mathematics where the relationship of the dependent variable to the independent variable os understood and practiced. In subjective thinking this is not what goes on. It is difficult to uncover the elements of the parts of the cycle of trading. Two parallelograms make up the cycle and smaller pieces make up a prarllelogram. to croos over from the pieces of the dependent variable to the corresponding pieces of the indepenedent variable is NOT gong to happen for most who think. take another look at the channel diagram that yielded 1 point of profit using an entry and an exit. the lines preceeding the trde are also arbitrary. what is it like to watch the bars that form the price movement between the annotated limits. What got the lines drawn in the first place? Then why was trade after trade not annotated or done? If a cycle can be defined as having two parallelogram parts and there are five price events in each parallelogram and there is a one to one correspondence in the independent variable in each parallelogram, then why is this orer of events not used to define a system? This set of additional degrees of freedom may be used if a common high utility type of mathematics is deployed.
By moving from the simple minimum demensions of trading cycles composed of two opposite trends, it is possible to deal with deducing when a trend does not end in the briefest time and when a trend ends in an incomplete state. These two deviations from the simplest are not usually considered by a person who does not use rational objective reasoning. Usually the substitute is subjective reasoning and the person settles for what he can gleen at some subjective level. It becomes "good enough". The more thorough objective alternative is to deduce and define all possibilities and put their interrelationships in a system of orders of events. The independent variable has the following: P1 to T1 to P2 to T2 to P3. A cycle of two opposite trends of three price moves: B2B 2R 2B followed by R2R 2B 2R. Detecting incompleteness or stretching the middle results in four types of trends.
They are also not interested in sharing. They grab everything they can, keep it for themselves and hide.
So an operator (trader) partnering with the market does the following. 1. He assigns a P1 at the beginning of a trend. 2. He uses price cases to get permission to move the trend forward on the volume variable. Meaurements in 3. can be made only when the bar or equivalent bar is a translation or a UL bar or a retro bar in a lateral. 3. A defined volume test procedure is used to annotate the middle of a trend. Values remain in force. The three steps of the volume tet procedure must be done as an order of events. 4. At the lock in of any bar, any possible End Effect is assigned and a reversal is made to take the full offer of the market. If no EE, then 2 and 3 are repeated. 5. If an EE occurs*, then A new P1 is assigned according to one rule: Assign P1 on the EE if a failsafe or an A band EE; if not then assign P1 on first subsequent measurable bar. * three sheets define the 35 EE's in band contexts. bands follow an Order of Events. The details and constraints of this process are explicitely defined in Boolean Algebra. As a consequence all the decisions are mutually exclusive which explicitly zero's out probability and eliminates prediction since all is known in the NOW. Look at the sheets provided. The points of the parallelograms in price are called "turns". The turns are defined by trend sentiment's dominance. Bands are used to define volume regions. Two limits define three zones. Between is a band pass. Above is a High Volume Break Out (HVBO). Below is a Low Volume Break Out (LVBO). Four types of trends exist. Two are incomplete. One is the norm. The extended trend is called "drift". Failsafe is there because most people do not like being up side down financially. The bookmark is the wash trade and the BO of the rtl with T1 is an earlier bookmark. Collectively this set of posts does go a long ways toward answering a lot of questions.
Your chart from the 4th shows the 'c' turn on bar 19 with the Ab to PP4 linkage (SetD). Presumably, you would have gone LONG on the next bar after establishing your BM on the low end of bar 19. How did you handle that rarely occurring opportunity - two consecutive OBs/PP4s?
Does this mean that when a PP2, PP3, PP3a and PP3b are found that the OOE isn't started over again? My understanding is that with other EEs, once they're found, you restart with a P1 (on the bar or the next bar). Is it different with PP2, PP3, PP3a and PP3b or am I misunderstanding? Thanks!
Yes you re correct the b1 was a BM; as you saw on my chart I neglected to degap the BM. thanks for pointing this out