weekend 25/2 THE CURVE

Not much to add to projections here but a review of where we have been and a description of how a bell curve develops in the market,from this section of data, looking at the market this way puts alot of random activity in to some sense of order.

First the step 1. the vertical move.

step 2. are the levels that initally stop the up move.

step 3. the market fills out .


step 4. the retrace ( to the 61.8 % level in this case )following the retrace the market again fills out creating an effeciency,The step 4 in this case produced an almost perfectly balanced bell curve it self.And the bulls finally won the battle.

The new step 1. with a break out . intresting the move begins at the control price( value) where I placed a mauve arrow. So fron one value ( 4390) we attempt to move on and discover new prices. the re connecion comes back under 4445, the question now is will it go on with it or will the current control price with 66 half hour hits continue to capture the market.the whole bracket mantained a nice up trend line , but for now thats all over and you would'nt say that this current move is all that convincing .... YET !...There are already 14 1/2 hr bars hitting the current control price of 4462, thats probably not enough to say the intitial force has been shut off yet but it's getting close.

For anyone that wants to have a go at looking at the market this way the first thing you have to learn is to recognise the vertical step 1's it's not that hard , if I can do it.
Second if you don't have a bell curve histo , in your softwere or market profile , you might have a VWAP study ( volume weighted average price ),failing that everyone has a mav study, on a 24 hr market like the spi a 200 30min bar av will put you on the batting crease, for stocks that trade only 6hrs per day probably 40 or 50 bars av will do it and from that you should be able to see what the market defines as value for that particular instrument. From there you'll be able to see that often when below value they buy and above it they sell, and thats why you'll hear alot of people say that the mav is providing support or resis , becauce trade is attracteded to it because what 95% of people miss is the fact thats it represents VALUE and thats why it goes there.When you get a price /value effeciency you'll often see various mav;s converge .Sya your looking for where a new step 1. might begin then if you've got the standard 20.50.200 mav's they will often converge around the point where a vertical phase of a step 1. begins, as we move from effeciency to in effeciency and price discovery.