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+--- Thread: Stage Analysis Beginners Questions (/Thread-Stage-Analysis-Beginners-Questions)
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RE: Stage Analysis Beginners Questions - primitivetrader - 2021-12-13
hello everybody,
I am new to this forum. I am a breakout swing trader from India.
after studying Stan's book, I was looking for some courses so as to relate the theory to charts and found it at udemy, isatrader thanks for the course.
I have a question with regard to relative strength. If I use a spread/ratio chart (index is "NIFTY") will that be sufficient? or do I have to use Mansfield RS(it's available in tradingview, no idea about its calculation)?
mostly i am using Weekly-EOD - 75M time frames (a precise division of 5). will I have to change the lookback period for each timeframe?
requesting to please provide the inputs.
thanks
RE: Stage Analysis Beginners Questions - isatrader - 2021-12-14
(2021-12-13, 06:42 AM)primitivetrader Wrote: I have a question with regard to relative strength. If I use a spread/ratio chart (index is "NIFTY") will that be sufficient? or do I have to use Mansfield RS(it's available in tradingview, no idea about its calculation)?
If you want to compare against the NIFTY then that is fine. To convert the standard ratio chart to a Mansfield RS, all you need to do is add a 52 week MA to the spread chart, as that is the "Zero Line" on the flattened Mansfield RS chart. On the daily chart a rough equivalent is the 252 day MA.
RE: Stage Analysis Beginners Questions - fabi470 - 2021-12-28
Hi Isatrader!
I hope you had a nice christmas time.
I have a question: i am askingmyself what is more important in stock selection. A strong industry group or a strong sector?
Lets assume that you have two options and you definitely have to choose one:
- Stock A in a very strong industry group, but in a lagging sector
- Stock B in a very strong secot, but in a lagging industry group
So, what is more important to you? Of course, the ideal scenario is a stock that trades in both, the best industry group and in the best sector, but real life is not perfect all the time.
I would love to hear from you and your valuable opinion!
Greetings and a good start in 2022 already!
'Tis the season for puts - z_CharlieMiller - 2022-01-30
Since joining the site fairly recently I've begun studying the Wyckoff book by Pruden and am just now trying to put the new learning into practice.
I've come upon a question that I don't see the book really answering, so I thought I'd put it out to the group for consideration/disucssion, and hopefully an answer.
The stock is Ally Bank (ALLY), which I'd identified some time back as a possible short just based on Weinstein characteristics: The stock had broken the 30 week, the slope of the 30 week had been weakening for some time, and the 30 week was beginning at that time to look like it was going to roll over, which by now it has done.
Since that that time the daily chart seems to have traced out a pattern with Wyckoff features I've named as best I could in the attachment (this is early days for me and Wyckoff so, feedback/comments on alternative interpretations most welcome).
What I think I am seeing now is that the recent Sign of Weakness downtrend followed by a rally attempt that only made it about halfway up the trading range before heading south, I believe would make the peak of that failed attempt the Last Point of Supply, which I suspect would have been just the right place to open a short position.
My question has to do with estimating the size of the potential drop. I've attached my P&F view, taking 49 as LPS and estimating a width of 8 or 9 boxes, and thus estimating 41 or perhaps 40 as the near term ground floor of the elevator, with likely stops/bumps around 45 and 43. Very much appreciate comments and suggestions along this line. Also I am using a daily P&F for this, and a get a slightly different answer (more like 43) using a weekly P&F and the weekly doesn't show the features as well. I'm supposing that daily is the correct one to use, but I don't know that. The daily P&F does at least harmonize the time scales between the P&F and the bar chart.
Other thing I'd mention is that I became interested in this ticker as a possible short back before joining stockcharts.com and based on what I have learned using their user-friendly sector tools I might have eliminated it based on the emerging RS of the Banks sector. Of course, these things are never as crisp and clean as we'd like, but I still think this chart is going to be an interesting exercise as I'm learning Wyckoff and how to read/use a P&F chart. Appreciate comments, suggestion, discussion.
Thanks,
Charlie
RE: Members Discussion - isatrader - 2022-01-30
Really good question Charlie. I'm just working on the weekend video content. So I'll try and circle back to this later on once that's done.
RE: Members Discussion - z_CharlieMiller - 2022-01-30
As time allows David - this really is a long term/learning question, not so much about the short position on Ally but more about whether my interpretations of the price action are on the right track. I also wonder if the pattern I'm looking at for Ally is not so much a classic Wyckoff distribution pattern so much as perhaps an assortment of accumulation features that simply failed (or whether that is a distinction without a difference). Looking forward to the Sunday video. -Charlie
RE: Members Discussion - isatrader - 2022-01-31
(2022-01-30, 10:20 PM)z_CharlieMiller Wrote: As time allows David - this really is a long term/learning question, not so much about the short position on Ally but more about whether my interpretations of the price action are on the right track. I also wonder if the pattern I'm looking at for Ally is not so much a classic Wyckoff distribution pattern so much as perhaps an assortment of accumulation features that simply failed (or whether that is a distinction without a difference). Looking forward to the Sunday video. -Charlie
Hi Charlie,
I've marked up the daily chart with my interpretation the range, which I would also see as a distributional structure. But I've marked the entire range for your reference, which I think would be a down sloping structure (which is a sign of weakness in itself).
For the P&F count from the more local base structure that you have identified I count 8 columns from the 49 LPS to the Local Selling Climax. Therefore 8 x 1 x 3 = $24
49 - (24/2) = 37
I divided count by 2, as on the downside I think you halve the the result compared to upside projections. But would need to refresh my memory, as been a while since I've done a downside projection.
A more conservative count would be using the higher level LPSY I've marked which has. count of 6 columns, and hence 6 x 1 x 3 = $18
49 - (18/2) = 40
So that would be the projection for Segment A, but I'd personally take the broader segment from the higher LPSY for the whole range if considering a larger Stage 4 decline. So would be 19 columns, hence 19 x 1 x 3 = $57
UTAD 55 - (57/2) = 26.5
LPSY 53 - (57/2) = 24.5
But you should always consider the near term target levels first as you have done.
In terms of what charts you should use. The daily chart with a user defined box is best I find for longer counts on sizeable bases. Not the weekly.
For very short term. The 60 minute chart is more useful.
Use the ATR to work the best box size to use in your user defined setting. But always start with the traditional and adjust, which will take some practice.
RE: Members Discussion - z_CharlieMiller - 2022-01-31
Thanks very much David - very helpful points on the P&F setup and application!
Looking at your markup I see that the main thing that led me to the shorter time scale pattern is that I was really focusing on the span of time AFTER the breech of the 30 week, meanwhile the actual buying climax occurred a good 4 months before that breach. This all makes a lot more sense now in terms of the overall pattern. Much appreciated. -Charlie