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Book Discussion: Reading Price Charts Bar by Bar by Al Brooks
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Book Discussion: Reading Price Charts Bar by Bar by Al Brooks

  #141 (permalink)
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websouth View Post
failed H2 12:15 ... right?

I think so.

For now I'm concentrating on the H2/L2 that are near the EMA (as suggested in Gary's notes from the webinar). But it's odd that we see two failures on his chart. But then again if it worked 100% then brooks would be a billionaire right?

There must be some other factors involved in his decision to take these trades.

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  #142 (permalink)
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cunparis View Post
I thought I'd make an indicator to show H2/L2 this weekend. So I started to work on it and I realized I didn't know how it works exactly. I mean what is the criteria? You have to recognize that you have a pullback in a trend. I do not think this is easy to automate. You have to start the count in the right spot and that's the hard part.

I was thinking about L1, L2, L3... labeling some weeks ago.
IMO it is not possible, as you have to define the start (L1) and whether there is an L3 or a new L1 etc. How about variants? There are no clear definitions about all this things. So you always would produce a lot of wrong labels, and that is worse than no labels.

I wrote a LegHL indicator (at NT indi section) that does a basic labeling and has a choice how to handle outsidebars. Thatís helpful for a beginner or for some trading strategies like EMA G. As you read the chart bar by bar you will find them very easy after a few days/weeks without indicator.

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  #143 (permalink)
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cunparis View Post
For now I'm concentrating on the H2/L2 that are near the EMA (as suggested in Gary's notes from the webinar). But it's odd that we see two failures on his chart. But then again if it worked 100% then brooks would be a billionaire right?

There must be some other factors involved in his decision to take these trades.

I don't know about other secrets of Brooks, but I combine Brooks stuff and the volume (Tom Williams, The undeclared secrets that drive the stock market).

And there are some patterns (like EMA G) that works better than others.

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  #144 (permalink)
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terratec View Post
I don't know about other secrets of Brooks, but I combine Brooks stuff and the volume (Tom Williams, The undeclared secrets that drive the stock market).

I love Tom Williams' books, I read Master the Markets and I want to read the one you refer to as I need to read his material again.

If you can, I'd love to see some examples of how you combine the two.

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  #145 (permalink)
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Just took a CL L2 trade, got 13 ticks. Note that the L2 came just after an HVC bar.

I'm doing this on sim until I can do it consistently.

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PS: I decided to do away with all the special indicators and go back to my trusted & proven setup on Tradestation. Unfortunately tradestation charts and annotations suck. And since I trade with the NT DOM I don't have chart markers on my TS charts so I have to mark them myself..

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cunparis View Post
I love Tom Williams' books, I read Master the Markets and I want to read the one you refer to as I need to read his material again.

If you can, I'd love to see some examples of how you combine the two.

These two books are not very different. Yours is the marketing edition for the software.

If I have a good chart example the next days I will post it.

But itís just like: up-bar, on high volume, with a narrow spread, into new high >> very bearish, so look for L

Or low volume on PB in uptrend, so look for H

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terratec View Post
These two books are not very different. Yours is the marketing edition for the software.

If I have a good chart example the next days I will post it.

But itís just like: up-bar, on high volume, with a narrow spread, into new high >> very bearish, so look for L

Or low volume on PB in uptrend, so look for H

You just described two volume patterns (HVC & LVPB) that I have written about in my Volume Thread.

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Another L2 on CL this time on a 900 tick, which is about 4-10 minutes during this time period (before pit open).

Normally I don't trade near the pit open but what the heck it's sim right?

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cunparis View Post

Can you guys check my chart and let me know if I'm marking this correctly? It's easy to do in hindsight. So I'm going to try it real time tomorrow.

Thanks for the good words cunparis. I'm by no means proficient with these patterns yet but it seems that the more I read and the more charts I watch the more I am able to spot patterns in real time.

I copied your chart and marked it up a bit. I still don't know how to spot Low2/High2 setups with very good accuracy. I believe the key is the scope of the setup and the environment of trade. For example I know Brooks says to look for High2 setups in an up or sideways market. One thing he didn't quantify with that is the extent of the sideways market. On your chart (as I've marked) I believe the sideways movement is too tight to be trading High2's. Again that's just my opinion as I'm still learning this stuff as well but it definitely seems to be sinking in.

Blz

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cunparis View Post
I knew someone was going to ask if I had automated the dots.

I thought I'd make an indicator to show H2/L2 this weekend. So I started to work on it and I realized I didn't know how it works exactly. I mean what is the criteria? You have to recognize that you have a pullback in a trend. I do not think this is easy to automate. You have to start the count in the right spot and that's the hard part.

Usually I work in steps like this:

- identify a setup in hindsight for past days
- identify a setup real time
- see if I can write an indicator for it

usually the 3rd step is done in baby steps. like just automate HH or LL and then I can manually determine if it's H1 or H2 etc.

I'm still at the first step. Looks like Blz is on step 2.

I think I'm at step 1.5, starting to recognize patterns but still missing em and also thinking they are there when they're not. As far as programming this stuff I don't think it could be done as I believe the context of the setups is just as important as the setup itself. Plus you've got to keep in mind that sometimes the Low2/High2 setups are intrabar and don't actually present themselves on the chart.

Blz

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