Time & Momentum: Market Rhythm Does the market have its own innate rhythm? Is there a direct correlation between price relationship and market rhythm? In short, if there is indeed a rhythm that governs price movement, can we not detect distinct cycles of price pattern? This, along with the subject of market timing, will be the focus of TRAP, which I will discuss in length once I wrap up PMT. For the time being, I would like to briefly touch upon the importance of market rhythm. Personally, I view price movement as a particular dance form that strictly adheres to the law of rhythms. The word rhythm is derived from Greek and it denotes "flow" or "cycle". In another word, it is an interval during which a recurring sequence of events occur. Sounds familiar? It should. Hence, it really all boils down to one thing for me: vibe. Call me a vibe enthusiast. Whenever I see either strength or weakness forming in price movement, I try to also detect the underlying vibe. 1-2-3-4, 1-2-3-4, etc. I ask myself whether the strength or weakness is gaining or waning in tempo? The key is to be in synch with the vibe. Once you get the vibe down, you're then able to twist and turn in flying colors.
Finally caught a thread in the early stages that I can follow along!! Great start so far! Sign me up!
Saliva, Great start. Thanks. I am looking forward to following your posts. Do you plan on giving examples of actual trades in the future? Glad to see Anek weigh in. Seems like this could be helpful as a compiment to AHG.
PMT in Review As stated at the outset of this thread, PMT is an acronym for Price, Momentum, and Time. Price Prices are driven by demand and supply, and demand and supply are most noticeable at very specific places like support and resistance as well as trendlines. For example, we often see a huge spike in volume these days when a major support gets taken out, which leads to an outright panic selling. These are not random occurences. However, prices cannot be seen in isolation. Momentum Even though prices are driven by demand and supply, they alone cannot give us the entire picture. There still remains one missing puzzle: momentum. That is, what is the strength or the weakness of those demand and supply? Is it strong enough to warrant a breakout? Or is it too weak to risk another reversal? How can we possibly quantify momentum? This is where time comes into play. Time Time plays a critical role in understanding momentum. We can use time to extrapolate how strong a given rally might be and if it's strong enough to break above the next resistance. When momentum picks up in strength, time should equally keep up. Just like a train leaving the station, prices should gradually pick up in both speed and time. When momentum and time act in concert as prices come knocking on the resistance or the support, the impact is almost palpable. I do not expect everyone to agree with what I share on this thread. However, if you disagree, please provide specific reason for why you disagree rather than resorting to a blanket statement like "it just don't work!"
Saliva, thanks for taking the time. Discovery of new concepts are crucial to develop confidence and a better understanding of how markets work. You are definately providing that here!
First of all nice thread But I'm not sure about the rhythm. It can lead you to a belief about where the market should go and that may cause you to trade your beliefs (rythyms /pulses) instead of what the market is doing. now detecting patterns is a different story. Personally I don't trade pattern formations i usually wait till its fully formed
Taken out context of PMT and judging solely on the basis of market rhythm, your assessment would be correct. It would be foolish to trade merely by "your beliefs (rythyms /pulses) instead of what the market is doing". But market rhythm was discussed as an integral part of time (or duration), which is one of the three core concepts of PMT. I suggest that you take the time to read this thread in its entirety if you haven't already. BTW I am not referring to patterns like triangle and head-and-shoulder in the above quote. I'm rather alluding to a pattern of price movements that evolves over time (eg. price swings). P.S. Please bear in mind that I tried to make it as easy and accessible to everyone to understand the materials covered. However, by no means are they "simple stuff". It personally took me many years to grasp these same things I'm sharing with you. As such, I don't expect anyone to understand this overnight. But they shouldn't be impossible to grasp over time. If you have any questions, you need only ask.
Yet, indeed its a nice thead mostly ) At least slitt im really try to realize how ppl trade those "S&R levels" and/or "Price Actions" ) Im not trying to be a sarcastic badass, or rude person, but still... as for me, S-R and PA trades looks like a random trades really. You may go long, or short... dont care. Just use StopLoss.... andif you guess it right - you r fine. Well.. that kind of trading DO have all possible right to exist, but i really would like to see any real-time posts with trades (intraday) or a video file.. how ppl trade those unvisible levels PS: It a easy deal to be a ape-brain person with short position on 841 ES (yesterday`s 100SMA on 30min chart breakout)....till by now. And i dont really give a big deal if i got 3-4-5 10point stoploss on ES in a row... if then any "run" give 80-130 point reward. Anyway, all these posts just show the old well known truth, that there is not FEW ways to trade (even on short term), but there are dozens of way to do that proffitably. GL 2 u