This is an example of my interpretation of CCC, and how I used it. You can see how it was identified in real time.
Thanks for the prompt reply, cnms2. In the above pic, which part represents congestion? convergence? and centering?
Yes, but what represents what? Whenever Jack talks Congestion, Convergence, Centering, he implies each market event is identifiably separate from the next - as if Congestion, Convergence or Centering could be visually distinguished from the other two. It seems, in most cases, CCC happens more or less at once and its rather difficult to isolate one event from the other. In terms of price action, CCC seems to exhibit 1) flattening of price and 2) decreasing ATR over time. Thats how I measure it. Is it possible to break it down further without access to volume? I doubt it. At least for fx. Be very interested in your thoughts tho.
One of the easiest was I pick off CCC is right off of the MACD. What you will notice is that your MACD is CONVERGING and then CENTERING along the ZERO line. It is one of the more remarkable indications I have gathered from any indicator. With respect to Price and Volume, what you will notice is decreasing volume peaks where the end of each dominant volume series is decreasing. Another difficulty is that folks feel that they should recognize the CCC right off the bat (ie. on the first bar of the CCC). This is an experience problem since not all channels will end with CCC. To get familiar with CCC, I personally just grabbed a dozen or so PV Pennant formations whether they be FTP ro FBP. Then I noted the volume characteristics of the pennant formations so as to discern pennants from CHANNELS ending with an FTT. The difference will be noticeable in that CCC/PENNANTS will have volume that is noticeably lower then LONG/SHORT trending volume... Grab a few charts of active assets and note where MACD is around lunch. Also note the volume of those bars with respect to the rest of the day. Then notice the Price formation... You won't nail all of them but they are a pretty good start to identifying and filltering CCC... MAK
I think that if you don't have access to volume data, you can try to use the stochastic indicator. Because it reflects where the bar closed in relation to its length, in a CCC situation it should probably converge towards and ride the 50% value. Look at the stochastic 5,2,3 on the HPQ chart I posted! I think that this is very likely to happen in FTT situations, that can also be located using channels in multiple time frames. I vaguely recall reading somewhere in Jack's posts about CCC, but I can't pin point where. Probably there're others who could. EDIT: I haven't seen makosgu's post before I wrote this.
Thanks for the help, guys. I appreciate it!! Its great theres a forum like this where earnest traders can share. Good vibes I'll play with it this week and see what i come up with. Do either of you automate at all?
Post to cnms2 and makosgu, Cnms2, 1) Can you explain with visual example what R2B and B2R and gaussian means. I've tried reading up on it previously (based on the old posts from Jack Herhsey) but could not fully understand it 2) Simple moving average envelope: When do you enter based on the 'simple moving average envelope'--when volume touch which line? Thanks Makosgu, 1) You previously mentioned in the ACVmethod thread: 'Find a way to plot the BID and ASK prices for every single tick using an appropriately sized windows of say 100-150 ticks. Then plot each tick's corresponding BIDSIZE and ASKSIZE along side each tick mark. As you scroll along the chart, note the diminishing levels of the BIDSIZE and ASKSIZE and then note specifically how this relates to the BID/ASK price. Plot BIDSIZE/ASKSIZE in this mannyer also takes care of all the fake size. They stick out like night and day.... Furthurmore, it's tougher for them because the fake stuff just winds up screwing themself.' PS: pls bear with me on the 'tick question' as I'm not that familiar with it. So far only trade based on minute charts Some questions here: a) I believe when you mention 100-150 ticks, you are referring to 100-150 trades. Thus, when you mention 'plot each tick's corresponding bidsize and asksize along side each tick mark', are you referring to the 'size of the best bid/ask size' for each trade or the 'total depth of market of the best 5 price levels' for each trade? b) Also, that means in the window size, one will be able to see 100-150 candles/dots with each dot/candle representing 1 trade? c) You also mentioned in the ACV thread, 'In any event, I will try to get an animated .GIF posted to point out specifically that which I deal with' Question: Is the above out yet? Would love to see it. Thanks