what comes next should make sense, should sit within the confines of the prior structure, not to predict the future rather to protect
against bias and set levels of protection, of course that is based on the extent of the practical application by the practitioner
in this instance the count is offering an idea that the market is not just letting me "off the hook" of bias, rather, todate, it clarifies that
we have more in the same direction, if anything else transpires other than the count, the larger count road map may still be intact but the nearterm construct requires levels be adhered to ( lifter to .325) and patience applied
in this instance, given the current applied count, when price over laps it is the old holders exiting on best price available on the day, we know this because this particular stock had a recent history, since the low, of having the first 3 levels in the DOM at a 1.5 to 1 ratio (bid versus offer) in most of the steps, the steps are signs of patient buyers, these types of buyers we can argue have the pockets that are not prone to jittery reflex
... so buyers were patiently waiting and when no more supply would come price would be pushed upwards, this happens until the crowd has to be in and needs to chase the available supply that is thinning out, this is a natural course for an auction, this idea about volume is within the confines of what the construct says we should be seeing, yes i agree that that is somewhat misleading, the construct is asking what does the external data offer, how does the data fit the construct and not the other way around
it is specific to this part of the construct that we can say overlapping is permissible, in all other instances overlapping is a negative sign, usually only adaptive to retracements and congestion zones, or the end of major leg where smart money has to be patient for late commers to take up what theyre selling and that paints the correct picture, it gives us confidence that if we are exiting based on the structure then we agree that the story we are applying fits the construct not the other way around
looking at todays chart, this stair-stepping is in need for a break-away to print soon, clearly that is the point of inflection that the auction is saying the cats out of the bag, you're either in or you miss out
in the 1's n 2's scenario, these are rare, if you have kept charts on an hourly basis you'll find them, theyre worth researching, a warning,
in realtime you can be ahead of what price is telling you, that's not the fault of the principal, so when you see a series of ones and two's without correct context you'll see in them what confirms your bias, you are confirming your bias not the EWP
in retracements and congestion the overlapping is confirming firstly that we have exited an impulse or we're within an interruption to that impulse leg, either way ideas about what should happen within the confines of the structure alone need to be defined for protection and if a decision needs to be made for scaling, or what likely levels we should expect to see for any additional entries
in this chart, todate, we have a simple impulse leg up, with a running flat correction, followed by what should be a wave 3, which contains a series of tight steps
running flats are a clear indicator of intent within the auction to get going north, it is anticipatory without the necessary legs (volume and commitment by money that matters) there are usually markers, theyre contextual, in this instance the running flat is a simple ABC where the C leg equals the A leg at 100% - this is common, ratios that are in context assist the outlook in defining probabilites that the annotations are correct todays and what is likely to come next, again, if we veer away from that count and context then we should know to what to look for, to avoid complacency and risk, traders make a running flats so do investors trader make weak price discovery whereas investors comes in and support price at the end of the running flat, we should expect to see this activity
please bare with while i get some of this onto the page, seeing and knowing are a far stretch from explaining, eek!
if we place into context the very clean first leg up, followed by a well constructed running flat and a series of stair-steps higher, it is not
unwise to anticipate the next move to be swift in the trend direction, the construct should now confirm that we are in a series of 3's
(if you have 6 steps that should translate to 6 legs of widening 3's and the volume and momentum commensurate), this coinstruct should also offer a concise level to protect or exit on, different to a level where we might consider adding on a discount
it is vitally important to get away from the idea of prediction and into the idea of workable progress, sure we can look for targets and work congestion zones with ratios, build context for forward looking, these things are about protection, hence the reason that all counts be accompanied with an alternate count, the alternate count stands in as a what-if, sometimes the construct can be viewed in several ways so we need an alternative probability in mind for when suddenly breaks down and does something different to the road map, again this requires its own context and relative size of moves that are printing
players who use the EWP to be aggressive need to be extremely well versed in the principle at all degrees of trend and have all forms in their memory, other than that, all standard trading governance applies (hint: if you lack good trader governance you'll be bad at EWP)
one small advantage is the saying "when the moves over the moves over"
that means when a construct has completed it should not travel any further specific to the construct we have, there is nothing arbitrary or subjective about this, it is a completed construct, therefor anything printing beyond that construct (at all degree of trend) is a large warning sign you are not seeing the chart or price activity correctly, it should refocus you to question your road map, or, at least some part of that road map needs to be re-assessed, i suspect in all instances better to put that trade set aside and come back after time away.
we could look at this chart and project price, not a great idea right now i dont think, mostly we need to be focused on the channel and the count and that price remains within the confines of the channel and the construction prints in successive steps higher, given the news background, the probabilities of extended uptrend look very promising, the SPA today closed fractionally below the high, volume can be seen in several ways, is subjective of itself, one thing we can say is that price cannot ascend without decent supply and have a healthy price construct, these two ideas are self-affirming, if price was racing uphill but the volume (in the current construct) was very thin i would be warey of what is going on, ( let's not be naive, those are not investors, the opposite is taking place, so it maybe a warning signal to be quick to exit when the exit signal comes, the EWP does not print on any particular traders time frame, just like the auction it doesnt care if youre on the ball or not!) when the auction becomes a little heavy on the offer side that allows buyers to get ample supply, we still have an instance of players exiting "because it can't go any higher[surely!]" and those players are keen to bank coin
with the construct of MLX in hand i am inclined to sit shtoom, let the price tell me what it is doing, the idea of workable progress is to have the price dictate actions......
there are many competing ideas about volume, it can be argued that volume does not play a role in EWP, i think its a useful tool as a secondary consideration, in other words the EWP subsumes all other considerations and is the final decision maker, in that regard any facility (indicia, volume, clustering etc) can be assisting in framing what makes sense as you gain experience, theyre secondary
the only tool i have used, with instruments that have good volume, are ratios, not to be confused with (point to point) Fibonacci,
this has been very good entry and exit tool, not just for transactional pricing, rather for construct, it adds to specificity, takes me away from
holding onto a long piece of string .....
as i have proposed this stock for this thread i thought to put MMWMMI and bought some at 0.360's, i was not concerned if it pulled slightly which it did to 0.330's, well within the confines of the construct, rather i was more concerned that i was running out of excuses when i have already said outloud that this is a decent risk/reward proposition
price for this instrument should not print below 0.325 in the current cycle
small caveat here, having bought at 36's with a stop out at 325's that's a sizeable % drop right?
this is the risk versus reward moment, given the late entry, how well does the construct support this risk?
EWP can only reveal what is transpiring within the auction, keeping in mind that all degrees of trend are active at all times, it is the traders job to know they have enough data, the instrument is liquid enough, they understand how to apply the principal, that prediction is about them and not the method, you predict - the EWP merely reflects to you what you want to receive when misapplying ...sometimes ya gunna be wrong, every single method on the planet is sometimes gunna be wrong, every method takes a drawdown, repeatability is the key, if the EWP does not make sense to you then that is all you need to know, then you can immediately move onto a method that best "fits" you
EWP has a series of rules and guidelines
rules cannot be adjusted or muted, guidelines can be twofold: expectant and transient, in all instances we are looking for form and construction,
price lengths have their part, they are governed by form, this is not the same as round-peg-square-hole, form encompasses construct
within the impulse or corrective set, they are endogenous, this allows you to have empirical empathy for what is printing, youre allowing
price to dictate (trans)actions while educating yourself on what should not be happening and contextualise the size of the move so you can take advantage of what is happening
in this chart below if the series of higher highs and higher lows are broken they have a specific message and changes the whole outlook,
... without this construct build we may be of the notion to just hang in there, it'll come back
what is the difference between a paraglide, a hangglider, a single prop, a twin-prop, a jet, 737
if you want to fly somewhere, regardless the destination, the appropriate transport is key
you would never confuse any of them with a helicopter or a drone,
the difference be tween a directional and anti-directional trade
surgeons have a specific language for surgery
the more risk taken on the more specific the requirement of inspection needs to be
and it needs to be empathetic to a dynamic price in the same way a 737 pilot would deal with windsheer