Initially I studied and highlighted outstanding differences in the vol. to True Range in the daily as discussed last week, the only shortcoming was the lack of an average in the True Range to compare current bars to so I've had to try to evaluate these by eye. I know it looks messy however I've left the workings to try to get a better feel of the impact of price and spread, some particular areas stood out which I've numbered and discussed below. Still early days interpreting this so any advice welcome, thanks.
From here I drew back to look for any areas of obvious price structure, for some reason my weekly wouldn't load so I pulled back to the monthly, the idea was to get an overview so the monthly still worked well, here I identified and marked out the Structure starting with the most recently confirmed Reaccumulation as TR2 (which I've included the Final Phases of on the Daily marked in green)
A couple of things I noticed here were the high close on the most recent wide spread upbar that broke previous high marked in red on approx. 2/3 the volume, less resistance (comparative ease of movement?) and that the next 3 bars, while testing the lows on reducing volumes appear to contain enough demand to remain above the low of this bar unlike the previous high which spiked on high volume but then closed lower and failed to maintain enough demand to close inside this bar again, a clear sign of weakness previously but also a sign of some demand here in comparison. Currently we appear to be testing this previous high at .72
Once I'd identified the structure on the Monthly/Weekly, I then marked out the next TR on the Daily in blue as identified by the BCX (Buying Climax) and AR (Auto Reaction), closely aligned with the PSY (Preliminary Supply) with the weak ST (Secondary Test), as Phase A Stopping Action. The following structure from there I've marked as Reaccumulation with a Spring/Shakeout followed by Last point of Support 1, an Upthrust of the second highest close, and another Last Point of Support 2, another higher low.
Successful tests are circled in black and failed tests in red with a green line to volume.
1. Price closes above previous range indicating a potential Major Sign of Strength, needing confirmation, volume exceeding spread here showing low volatility, effort > reward and signs of resistance to the move with price still rising regardless, looking strong.
2. Back up to Edge of Creek sees price pull back with low volatility on lower volumes, looking for confirmation of MSOS by drawing out minimal supply to the downside here, it appears to resist the downside and demand shows ease of movement to the upside.
3. Price again breaks out here with small spread but higher volumes showing resistance to the move but closes high and gaps up regardless. This would be an ideal long entry according to Wyckoff theory. After initial breakout price is tested successfully (circled in black) before moving higher again.
4. I've marked this as Preliminary Supply in the structure as initially supply came in with higher volume and low spread closing low before being tested and moving higher again, it also aligns well with the Auto Reaction which I would mark first.
After testing, spread increases here with ease of movement and bars closing to the upside.
5. This bar is the first bar to have a spread clear above previous high of .72 and the gap up move to achieve this new high appears to have exhausted demand as the following bars breakdown and remain lower than the close before ease of movement lower on increasing spread on low volume closes back below the gap.
6. Price appears to have now found support where it last found and overcame resistance, this I've marked as Automatic Reaction, it appears that a Spring of this support formed here and responded to the upside with ease of movement and gapped up above the old high accordingly on just below average volume and closed off the high.
7. Price appears to have held a tight range here again around the old high on very low volumes with a Spring low responding to the upside but failing to follow through and after a failed test (circled in red) price broke down on increasing spread and volume drawing out substantial supply.
8. Price initially found support inline with previous resistance and another Spring low drew out more supply before closing higher however a further test failed and price drifted below this range on low volume but failed to follow through to the downside before returning back to above support on average volume with relative ease of movement.
9. Price again returns to a low volatility range on low volume just above support where it appears to be holding well until what looks like a failed test draws out some supply
in the following bar before a Spring low of minor support causes an upside breakout on average volume with a following gap up before encountering some resistance in higher volume with reduced spread at old high again at .72 but closes on high just above. Another gap up the next morning sees higher spread on reduced volume before a final bar that closes on high pushes up and becomes the second highest closing bar on the chart.
10. From here on no bar closes on its bottom and lower volumes and volatility, we see a short pullback below support that immediately reverses to close on high and continues in this tight range and puts in a higher low again below support as a confirmed test (next bar closing higher), this gives strength in the immediate background. The last 4 bars close above .72 but still within the range with Friday's bar a potential test, with strength in the recent background a confirmation on Monday could prove extremely bullish or a fail could see further testing of the larger structure.
If we look to the larger down trending black channel as a potential accumulation structure, the close marked UT could be seen as a MSOS and this low volume pullback a confirmation as back up action or BUEC, confirmation with a breakout move above this upper trendline around .82 looks quite possible.
Sorry for the extended post but it was written over around 15 different goes and no more time to cut it back as its been a busy weekend, happy wife, happy life they say
Will follow up with the Monthly and Daily
Cheers HF
