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Just a few words on pipe bottoms, pipe tops and reversal bars.
The pipe top or bottom, also called railway, is basically a reversal bar that extends over 2 bars. A railway on 5 minute chart is a reversal on 10 minute chart. For that reason I try to identify both
-> the smaller timeframe reversal bars
-> the larger timeframe railways
Further I think that reversal bars should be filtered. I use two indicators for filtering, a range indicator and the VWAP with standard deviation bands. The filtering by the range indicator is automated, the VWAP filter is currently added manually, will probably change that.
Just commenting the 11 candles, which I have marked on the chart:
1) weak reversal and part of a descending triangle failure
2) failed reversal wihtin a strong downtrend
Both reversals can be discussed, maybe they are not valid as the 10 minute close is below the open.
3) reversal bar detected on both timeframes (5 min and 10 min), validated by support and the VWAP 2SD band.
4) reversal bar detected on the higher timeframe, validated by both indicators.
5) far away from 2SD band - ignore.
6) far away from 2SD band - ignore
7) close enough to 2SD band, completes a 3-push-pattern.
8) valid pattern
9) too far away from 2SD band - ignore
10) valid pattern
11) valid pattern
Still working to improve the concept. I look at a volume indicator and an oscillator as well. For a reversal there should be a divergence somewhere on the chart.
thats a pipe? i thought they had to have almost the same highs or lows? cuz if you look across charts you can see where there are many that would be huge failures.. ill post in reply with one on a previous chart that always bugged me..
dont believe anything you hear and only half of what you see