ProfLogic's Method

The issue is that to really get the labels perfect, one needs to use two data streams (i.e. 2401 and 343). If one doesn't do that, there are ways to approximate with one data stream only. Some approximations are better than others. That's all.

You are, of course, entitled to your opinion.

JW

 

This is an interesting topic, one that I too, have given some thought to over time.
Bill uses an indicator to determine the distance created from one label to the next along with an arbitrary number addition to add to the momentum or trend, the "7" ticks.
I have seen others use a percentage of price movement to determine direction/momentum, Roy Kelly for example. Still other use a fixed number of ticks/points to determine direction such as one very successful trader from Australia whose name I forget.
All are based on price rotating from high to low and high again. To me these are the best ways to trade the S&P in particular. The problem however with all of these methods is they absolutely kill you in strong trending moves, such as the downturn on Friday where the 2401 histo oscillated in prime several times.
For all of these methods you are left with the biggest factor of all, subjectivity. Subjectivity is what prevents a successful method from transferring from the originator to the student.

 

If you pay attension to the Trading Decision Chart and then move to the Entry Chart it will be less confusing.
Remember that the labels are being generated from calculations and not from the actually osccilations off the fastest chart.
I repeat . . . this can be accomplished using dual data streams on some charting software packages but some won't allow that. MultiCharts will but every chart you "Embed" with multiple data streams increases the processor useage by 7 times.
Bottomline, it is necessary to watch BOTH charts at the same time.

 

We have a tendency to overthink this process. It isn;t necessary.

 

EDIT: In light of PL's comment above, i'll withdraw what I wrote... PL has provided the framework; find out how to make it work for you

 

I absolutely agree but this is why we trade the chart WE are watching. The data will vary from person to person based on the amount of data they have in their charts.

Individuals that are using; MultiCharts, eSignal, my Workspaces and indicators have nearly identical charts. As we vary our specific tools the oscillations will vary slightly.

 

Is there a way to prevent this kind of trade? (understand losses are inevitable)

 

Yes, wait for the next Entry Chart ERG oscillation & PF sequence for the entry.
or
trade slower charts.

 

OK, is there an explanation for that answer? (understand slower chart part)

 

The Entry chart entry is suppose to occur when the Histogram is in Prime. What you showed is:

2401 Trading Decision Chart - Prime Trading PPF toward Prime Trading Breach, Histogram Oscillation in Prime (All Perfect)

Next Step is the Entry Chart to give you an ERG Oscillation in Prime . . . it didn't. By the time the Histogram Oscillated the Entry ERG had already oscillated and moved out of Prime. You simply triggered a PF Sequence after the 2401 Histogram Oscillated. If you would have waited until the Entry Chart ERG oscillated in Prime there would have been no entry because your PPF would have turned into a Breach.