1
00:00:01,520 --> 00:00:07,300
Hello everyone, today is February 11th
and this is our session number 6 of the

2
00:00:07,300 --> 00:00:08,300
Wyckoff Trading Course.

3
00:00:08,820 --> 00:00:12,560
Today we're going to jump into the
volume and price analysis.

4
00:00:13,000 --> 00:00:18,160
This is something that I've been waiting
for for quite some time. Unfortunately,

5
00:00:18,160 --> 00:00:24,920
we can't do this right away. We need to
be familiar with the

6
00:00:24,920 --> 00:00:29,660
price structural analysis first before
we start understanding how volume

7
00:00:30,300 --> 00:00:31,300
influences the price.

8
00:00:32,600 --> 00:00:34,000
So this is where we are.

9
00:00:34,440 --> 00:00:39,780
And today it's kind of like this
transitional class. We're going to

10
00:00:39,780 --> 00:00:41,980
homework, but then we're going to go
into the new material.

11
00:00:43,200 --> 00:00:49,900
Some of the notes. So usually I don't
read a lot on the comments, but I want

12
00:00:49,900 --> 00:00:51,220
comment on your comments.

13
00:00:51,420 --> 00:00:55,120
So if you had a chance to read this,
this is great.

14
00:01:04,170 --> 00:01:06,790
Okay, so what's important here from the
comments?

15
00:01:09,010 --> 00:01:14,370
Events phase analysis club with the wave
analysis logic, you discussed

16
00:01:14,370 --> 00:01:20,470
indirectly, helped me identify a trade,
few Wyckoff trading ranges and 530 one

17
00:01:20,470 --> 00:01:26,690
-day weekly timeframes. I have started
seeing the price chart differently now,

18
00:01:26,830 --> 00:01:30,710
and that's what I wanted to get. Okay,
this right here.

19
00:01:31,230 --> 00:01:33,890
I would certainly consider this as a
major breakthrough.

20
00:01:35,390 --> 00:01:41,710
So this is exactly the time and this is
exactly the message that I should be

21
00:01:41,710 --> 00:01:42,730
hearing now from you.

22
00:01:43,870 --> 00:01:49,590
Because it's been already five sessions
that we've been together. This is the

23
00:01:49,590 --> 00:01:50,590
sixth session.

24
00:01:50,730 --> 00:01:56,630
So this logic, the Wyckoff logic, or the
logic that I teach you guys, should be

25
00:01:56,630 --> 00:01:57,650
seen on the charts.

26
00:01:57,910 --> 00:01:59,730
You should be seeing trading ranges.

27
00:02:00,480 --> 00:02:05,840
You should be seeing changes of
character. You should be seeing extremes

28
00:02:05,840 --> 00:02:06,840
trading range.

29
00:02:07,280 --> 00:02:11,940
For instance, you know, like spring,
upthrust, those type of extremes.

30
00:02:13,280 --> 00:02:18,680
You should be able to label those
extremes, label the phases with the

31
00:02:18,680 --> 00:02:23,580
ranges. And therefore, when you look at
the market, when you look at the stock,

32
00:02:24,300 --> 00:02:29,860
you should have a different type of way
of analyzing this. And this should come

33
00:02:29,860 --> 00:02:33,040
now. So it usually happens in the second
months.

34
00:02:37,420 --> 00:02:40,620
Thanks for overloading us. I need to
know this stuff.

35
00:02:41,040 --> 00:02:45,980
It seems to be coming together more each
week. Yes, and that's how it's built.

36
00:02:46,020 --> 00:02:50,620
It's built on layers, right? So today
we're going to go into a new big layer,

37
00:02:50,800 --> 00:02:52,920
but still we're going to be a little...

38
00:02:53,310 --> 00:02:59,630
building the new layers based on what
we've learned so far.

39
00:03:03,070 --> 00:03:08,910
Still working on volume supply demand
tests, Tron weak hands, and

40
00:03:08,910 --> 00:03:15,330
this is something that is going to come
more. So we're definitely going to go

41
00:03:15,330 --> 00:03:16,490
into this material more.

42
00:03:18,110 --> 00:03:19,210
Okay, what else?

43
00:03:28,240 --> 00:03:30,440
Okay, so yeah, that's great.

44
00:03:32,140 --> 00:03:36,300
Okay, well, everything else is kind of
thank yous. And thank you for thank

45
00:03:36,300 --> 00:03:38,080
Yeah, I really appreciate this.

46
00:03:38,560 --> 00:03:40,420
And thank you for the comments.

47
00:03:41,780 --> 00:03:45,920
So I think that we're in a good place.
And actually, I was really impressed

48
00:03:45,920 --> 00:03:46,920
the homeworks.

49
00:03:47,120 --> 00:03:49,760
I think we worked really hard on
labeling.

50
00:03:50,080 --> 00:03:55,200
We worked really hard with all of the
homeworks that we've done, with all of

51
00:03:55,200 --> 00:03:57,360
adjustments throughout the reviews.

52
00:03:58,120 --> 00:04:03,580
And now I see you guys are so good with
this. I was really impressed with this

53
00:04:03,580 --> 00:04:06,280
week's homework. So thank you for
submitting your homework.

54
00:04:06,800 --> 00:04:13,680
All right, let's jump into our session
for today. So

55
00:04:13,680 --> 00:04:20,040
today, first we're going to review Apple
homework. So this review will be quick.

56
00:04:20,810 --> 00:04:24,730
I would rather spend more time on the
new material and especially the group

57
00:04:24,730 --> 00:04:29,310
exercise that we're going to have here.
This group exercise will take us

58
00:04:29,310 --> 00:04:32,310
probably five, six sessions, hopefully
five.

59
00:04:33,150 --> 00:04:37,410
So this is going to be a very, very big
piece of knowledge that I'm going to

60
00:04:37,410 --> 00:04:38,770
give you guys for this exercise.

61
00:04:39,970 --> 00:04:44,190
We're going to start on the volume today
with the volume and spread analysis.

62
00:04:44,210 --> 00:04:48,370
This is an essential basic that we have
to have.

63
00:04:48,990 --> 00:04:53,550
in order for us to understand the
interpretation of the relationship

64
00:04:53,550 --> 00:04:54,650
price and volume.

65
00:04:55,550 --> 00:04:59,050
I'm going to give you two homeworks.

66
00:04:59,490 --> 00:05:03,910
Homework six, actually, why is it one?
Six and homework seven.

67
00:05:04,170 --> 00:05:09,090
So homework six is going to be an easy
homework. It's going to be just one

68
00:05:09,090 --> 00:05:10,090
type of homework.

69
00:05:10,590 --> 00:05:15,990
And it's going to be around the volume
and spread concepts.

70
00:05:16,730 --> 00:05:18,230
Then we're going to talk.

71
00:05:18,620 --> 00:05:22,480
really quickly about the loss of the
supply and demand, effort versus result.

72
00:05:22,660 --> 00:05:24,160
I'm going to give you my take on those.

73
00:05:24,840 --> 00:05:29,520
And then we're going to start that big
group exercise.

74
00:05:30,480 --> 00:05:35,680
And hopefully we're just going to kind
of like go fast through this.

75
00:05:36,040 --> 00:05:38,600
Next session, session number seven.

76
00:05:39,860 --> 00:05:43,820
We're going to continue with our group
exercise. We're going to talk about the

77
00:05:43,820 --> 00:05:45,280
volume phase analysis.

78
00:05:45,880 --> 00:05:52,880
That is what are the characteristics of
supply and demand in different phases

79
00:05:52,880 --> 00:05:55,160
of accumulation and the distribution.

80
00:05:55,820 --> 00:06:00,020
And then, again, the homework is going
to be a group exercise.

81
00:06:00,400 --> 00:06:06,200
By the way, speaking about the homework
of the group exercise, one of the main

82
00:06:06,200 --> 00:06:12,160
assignments here is going to be to watch
again

83
00:06:12,160 --> 00:06:16,200
and make notes.

84
00:06:20,430 --> 00:06:27,190
So I want to reiterate this from the
beginning of this exercise.

85
00:06:28,210 --> 00:06:32,910
This exercise will give you a lot of
knowledge.

86
00:06:33,730 --> 00:06:40,530
And this knowledge will be given to you
also on the slides as well. But

87
00:06:40,530 --> 00:06:46,690
the most effective way to gain value
from this knowledge is to actually watch

88
00:06:46,690 --> 00:06:48,890
the exercise again.

89
00:06:49,710 --> 00:06:52,430
make notes, and think about those.

90
00:06:53,410 --> 00:06:58,970
This has been a big educational tool

91
00:06:58,970 --> 00:07:05,830
in this course, making notes about this
exercise.

92
00:07:06,150 --> 00:07:12,870
And from cycle to cycle to cycle,
students are emailing me

93
00:07:12,870 --> 00:07:17,930
and saying that when they watch the
video again,

94
00:07:18,830 --> 00:07:24,250
They are catching so many things that
they did not catch during the class.

95
00:07:25,250 --> 00:07:31,830
So I'm going to reiterate this many
times throughout the next five

96
00:07:31,830 --> 00:07:32,830
sessions.

97
00:07:33,530 --> 00:07:35,830
So you'll hear about this again.

98
00:07:36,070 --> 00:07:37,650
All right, let's review the homework.

99
00:07:37,890 --> 00:07:39,850
The homework was on Apple.

100
00:07:40,550 --> 00:07:45,370
And here, together with the homework,
I'm always trying to give you some kind

101
00:07:45,370 --> 00:07:46,370
concepts.

102
00:07:46,600 --> 00:07:52,240
Today's concept for the homework review
is going to be about institutional value

103
00:07:52,240 --> 00:07:53,240
zone.

104
00:07:53,400 --> 00:07:59,660
And I forgot who exactly, but one
student was asking me in the email, you

105
00:07:59,660 --> 00:08:05,800
when are we going to be covering the
value zone definition? And that's kind

106
00:08:05,800 --> 00:08:12,120
like what's so timely as a question,
because this exercise, in a way, is kind

107
00:08:12,120 --> 00:08:13,580
devoted to...

108
00:08:14,040 --> 00:08:18,360
thinking about the origination of this
concept, institutional value zone.

109
00:08:19,420 --> 00:08:25,480
Let's look at the trading range first
and the labeling on its own.

110
00:08:25,720 --> 00:08:32,419
So some of you have figured out that
this whole

111
00:08:32,419 --> 00:08:34,179
formation is a trading range.

112
00:08:35,380 --> 00:08:42,140
And then some of you decided to maybe
have a different

113
00:08:42,140 --> 00:08:43,140
interpretation.

114
00:08:43,909 --> 00:08:49,250
and have a lot of small trading ranges
identified. So, for instance, somebody

115
00:08:49,250 --> 00:08:54,650
would be looking into this area, this
area, this area, this area, this area,

116
00:08:54,710 --> 00:08:56,250
this area, this area.

117
00:08:57,070 --> 00:08:58,890
Both approaches are correct.

118
00:08:59,790 --> 00:09:06,270
Yes, we do see a consolidation if we
would think about the climactic action,

119
00:09:06,350 --> 00:09:11,690
automatic reaction, secondary test that
define phase A and the change of

120
00:09:11,690 --> 00:09:12,690
character.

121
00:09:12,780 --> 00:09:17,740
relative to the uptrend that we have had
in 85 to 87,

122
00:09:18,020 --> 00:09:24,820
if we would have bought the stock and
then in 2004 have sold the

123
00:09:24,820 --> 00:09:27,220
stock, we would not gain anything.

124
00:09:28,000 --> 00:09:32,620
Meanwhile, there were quite a lot of
deviations around this mean, right? And

125
00:09:32,620 --> 00:09:36,380
especially on the rally in 98, 99.

126
00:09:37,300 --> 00:09:40,940
So let's just kind of think about this a
little bit.

127
00:09:41,840 --> 00:09:48,040
Is it possible that maybe the trading
range was somewhere here?

128
00:09:48,400 --> 00:09:52,780
And I saw this in one of the homeworks.
And I thought that was a very

129
00:09:52,780 --> 00:09:53,780
interesting idea.

130
00:09:54,040 --> 00:10:00,000
And actually, I kind of like this just
because I see how the texture here

131
00:10:00,000 --> 00:10:06,380
was different. It was more of the
reaccumulation texture where we have a

132
00:10:06,380 --> 00:10:10,300
-type action. The price comes down and
then comes back.

133
00:10:10,640 --> 00:10:13,280
really quickly in a very aggressive
rally.

134
00:10:13,700 --> 00:10:16,780
And here we would be thinking it's a
sign of strength.

135
00:10:17,220 --> 00:10:20,600
I mean, look how everything looks so
good.

136
00:10:21,140 --> 00:10:22,760
There's not a lot of supply.

137
00:10:23,220 --> 00:10:28,340
There's demand that's coming up,
increasing. And then the rally has the

138
00:10:28,340 --> 00:10:31,200
characteristics of a sign of strength
rally.

139
00:10:31,880 --> 00:10:37,020
It's an increasing spread, increasing
demand signature, and the price commits

140
00:10:37,020 --> 00:10:38,020
buff.

141
00:10:39,210 --> 00:10:41,150
But it only commits above temporarily.

142
00:10:41,830 --> 00:10:47,850
So this pattern fails after the price
comes back and gaps down.

143
00:10:48,890 --> 00:10:50,810
Let me show you a little bit better.

144
00:10:51,310 --> 00:10:53,850
So here is this gap right here.

145
00:10:55,250 --> 00:11:01,270
So the first failure is to commit not
just by one close. The second failure is

146
00:11:01,270 --> 00:11:03,950
the return to the trading range. The
third failure...

147
00:11:05,240 --> 00:11:10,840
is the gap to the downside, and the
fourth happens on the increased supply

148
00:11:10,840 --> 00:11:15,140
signature. This is not how the backing
up action would behave.

149
00:11:15,700 --> 00:11:21,500
So therefore, this pattern fails, a
pattern of what we thought a

150
00:11:21,780 --> 00:11:26,880
So then we're going into another pattern
here, right, or another texture. So

151
00:11:26,880 --> 00:11:29,000
this looks like a distributional
formation.

152
00:11:29,840 --> 00:11:35,240
And it looks like a TP formation right
here where we have urgency to sell on

153
00:11:35,240 --> 00:11:39,900
gap down in activity throughout and then
a pickup in the institutional

154
00:11:39,900 --> 00:11:41,720
capitulation on the way down.

155
00:11:41,940 --> 00:11:46,200
So it's right here where institutional
trend followers are going to give up

156
00:11:46,200 --> 00:11:47,159
their positions.

157
00:11:47,160 --> 00:11:51,900
And that's going to produce this quick
move to the downside. So everybody's out

158
00:11:51,900 --> 00:11:52,900
of the position.

159
00:11:54,300 --> 00:12:00,260
And then because of that, Because the
CEO is out.

160
00:12:01,900 --> 00:12:08,480
And at the same time, you know, we are
thinking the CEO is

161
00:12:08,480 --> 00:12:09,480
out.

162
00:12:09,820 --> 00:12:11,160
ITFs are out.

163
00:12:12,480 --> 00:12:13,700
Professionals are out.

164
00:12:14,960 --> 00:12:21,040
And public also is going to experience
some pain here with

165
00:12:21,040 --> 00:12:27,140
getting into the position and then
getting out of the position, you know,

166
00:12:27,140 --> 00:12:31,640
the... at the price of this triangular
formation and then on the way down.

167
00:12:32,000 --> 00:12:38,780
So it just does not, this type of action
and

168
00:12:38,780 --> 00:12:45,780
later capitulation does not produce a
lot of demand on the way up. And

169
00:12:45,780 --> 00:12:47,200
that's why this rally fails.

170
00:12:47,520 --> 00:12:53,400
So exhaustion of both sellers and buyers
at the same time.

171
00:13:01,420 --> 00:13:07,280
And then we're going into the oversold
condition. I will come back to this and

172
00:13:07,280 --> 00:13:11,460
will explain to you how did this come
about.

173
00:13:13,700 --> 00:13:20,580
This is a little bit more volatile just
because Steve Jobs is coming back to

174
00:13:20,580 --> 00:13:26,640
company. So that produced some
institutional buying. We could see out

175
00:13:26,640 --> 00:13:29,940
deeply oversold condition, we are...

176
00:13:31,030 --> 00:13:32,230
rallying really fast.

177
00:13:33,570 --> 00:13:37,690
And then giving it all up and then
rallying even better.

178
00:13:38,750 --> 00:13:45,250
So a news -driven volatility at the end
of the down move.

179
00:13:45,490 --> 00:13:51,030
So what I'm saying is that I actually
kind of like this labeling too.

180
00:13:51,530 --> 00:13:55,930
And the reason why is because we have a
very clear commitment to the upside

181
00:13:55,930 --> 00:13:59,930
right here. We have a very clear
commitment to the upside even without

182
00:14:01,119 --> 00:14:02,820
the downsloping range.

183
00:14:03,040 --> 00:14:09,240
Even with the bigger range, we still
have a very, very pronounced

184
00:14:09,240 --> 00:14:11,180
commitment to the upside.

185
00:14:11,540 --> 00:14:13,460
And then something interesting happens.

186
00:14:14,440 --> 00:14:17,580
And those are characteristics of the
major sign of strength.

187
00:14:17,800 --> 00:14:19,080
Something interesting happens.

188
00:14:19,500 --> 00:14:24,980
We would be expecting a backing up
action into this area. Something like

189
00:14:25,520 --> 00:14:27,080
So what happens next?

190
00:14:27,420 --> 00:14:29,180
Well, 2000...

191
00:14:29,790 --> 00:14:31,690
and the market top.

192
00:14:31,930 --> 00:14:33,250
That's what happens.

193
00:14:33,490 --> 00:14:37,110
And then after that, we have the market
in the downtrend.

194
00:14:38,690 --> 00:14:43,830
And the market, as I mentioned before,
has so much gravity.

195
00:14:44,370 --> 00:14:51,270
It is so, you know, the sentiment of the
overall market is

196
00:14:51,270 --> 00:14:55,770
going to dominate sometimes the
sentiment even of the leadership stocks.

197
00:14:56,590 --> 00:14:59,470
and the leadership stocks are going to
show some kind of weakness.

198
00:14:59,830 --> 00:15:06,390
Well, 2000 market was a really urgent
market to

199
00:15:06,390 --> 00:15:13,250
distribute the stocks, and we had a
couple of big moves to the downside,

200
00:15:13,370 --> 00:15:15,770
big legs to the downside, very volatile.

201
00:15:16,170 --> 00:15:23,030
So that type of price action is going to
create a lot of following.

202
00:15:24,140 --> 00:15:28,360
So therefore, a lot of the leadership
stocks are also going to go down.

203
00:15:28,360 --> 00:15:33,000
not going to go down as much as the
market, but they're still going to have

204
00:15:33,000 --> 00:15:34,640
pronounced move to the downside.

205
00:15:35,200 --> 00:15:40,460
So sometimes in phase D, we would
observe this phenomenon.

206
00:15:41,400 --> 00:15:44,460
This is the phenomenon of a shakeout
action.

207
00:15:46,420 --> 00:15:52,080
And usually when we talk about the
shakeout, I want you to think about a

208
00:15:52,080 --> 00:15:53,080
scenario.

209
00:15:54,090 --> 00:16:00,990
long -term bullish scenario with the
short -term oversold

210
00:16:00,990 --> 00:16:06,370
weakness, which is effectively a
shakeout by itself.

211
00:16:06,930 --> 00:16:09,330
And that's what the shakeout is all
about.

212
00:16:09,750 --> 00:16:16,570
And I believe that the current market
action happened in the same way. It was

213
00:16:16,570 --> 00:16:20,430
shakeout, short -term weakness, the
price action.

214
00:16:21,290 --> 00:16:28,210
in the long -term consolidation pattern,
which still suggests that the U

215
00:16:28,210 --> 00:16:34,230
.S., even at this level of growth, is
going to produce a better result than

216
00:16:34,230 --> 00:16:36,070
anything else in the world right now.

217
00:16:36,310 --> 00:16:43,190
And therefore, it acts also as a flight
to safety, flight to quality, flight to

218
00:16:43,190 --> 00:16:44,190
defense.

219
00:16:46,240 --> 00:16:51,100
Even though the short -term picture, I
think going into summer and into early

220
00:16:51,100 --> 00:16:52,100
fall,

221
00:16:53,840 --> 00:16:56,080
we're probably going to have a reaction.

222
00:16:56,320 --> 00:16:58,440
We're going to consolidate for quite
some time.

223
00:16:59,420 --> 00:17:05,839
But then after that, going into 2020, if
that growth is still going to be there,

224
00:17:05,940 --> 00:17:11,180
even at the current levels, we might
have a continuation of a bull run.

225
00:17:12,720 --> 00:17:17,480
I've talked about this at the Market
Watchers Live this last Wednesday. If

226
00:17:17,480 --> 00:17:23,040
have not caught that session, go to
StockChartsTV

227
00:17:23,040 --> 00:17:25,300
YouTube channel.

228
00:17:28,920 --> 00:17:35,660
And then the presentation is called 10
Questions About Current

229
00:17:35,660 --> 00:17:36,660
Market Structure.

230
00:17:41,070 --> 00:17:46,190
And my segment there was really small,
probably like 20, 30 minutes. So you can

231
00:17:46,190 --> 00:17:46,789
watch that.

232
00:17:46,790 --> 00:17:53,210
So this is just a phenomenon in phase D
that happens sometimes with

233
00:17:53,210 --> 00:17:59,670
the stocks that are showing a lot of
strength on the major sign of strength.

234
00:18:00,070 --> 00:18:06,010
And then the market happens, the market
weakness happens, and the stock is being

235
00:18:06,010 --> 00:18:11,260
influenced. Just because the stock has
had a lot of supply, it needs some time

236
00:18:11,260 --> 00:18:12,620
to retest it.

237
00:18:13,580 --> 00:18:18,960
So therefore, that concludes that major
last point of support area.

238
00:18:19,380 --> 00:18:23,580
So this is a very, very huge trading
range. And somebody might be thinking,

239
00:18:23,680 --> 00:18:30,320
well, is it really possible from 1987 to
2004 that this is the trading range?

240
00:18:30,420 --> 00:18:34,620
How could we even confirm that this was
the trading range?

241
00:18:35,620 --> 00:18:38,700
Okay, well, one of the ways to confirm
this...

242
00:18:39,050 --> 00:18:44,970
is to extract the PNF target from the

243
00:18:44,970 --> 00:18:46,410
trading range.

244
00:18:46,990 --> 00:18:53,870
So here I'm using a very old software,
which was called Bullseye.

245
00:18:55,410 --> 00:19:00,490
And this software allowed to create this
type of long -term charts.

246
00:19:01,510 --> 00:19:04,830
I'm not sure if you could do this in
stock charts.

247
00:19:05,810 --> 00:19:07,710
I would be very curious to know.

248
00:19:08,820 --> 00:19:14,380
So here we are looking at the original
trading range. Here is this major sign

249
00:19:14,380 --> 00:19:20,760
strength. Here is this shakeout in 2000
that leads to the low LPF, low point of

250
00:19:20,760 --> 00:19:24,360
support. Here is our phase C with the
spring.

251
00:19:25,520 --> 00:19:31,960
And what we would do with the PNF count,
we would count from the right

252
00:19:31,960 --> 00:19:36,660
over to the whole area of where the...

253
00:19:37,000 --> 00:19:38,960
Trading range has started in phase A.

254
00:19:40,040 --> 00:19:44,760
And that gave us a target of 220.

255
00:19:46,920 --> 00:19:52,260
And we hit 200 and a half, I believe.

256
00:19:54,080 --> 00:19:56,040
Well, I would say that's very close.

257
00:19:57,720 --> 00:19:58,940
Why is this close?

258
00:19:59,360 --> 00:20:05,040
20 bucks? Well, because when we are
making a decision to enter this

259
00:20:05,040 --> 00:20:06,040
are in the...

260
00:20:06,220 --> 00:20:13,180
a six to nine dollar range so i would
say that extreme that is very close um

261
00:20:13,180 --> 00:20:17,960
for those of you who are curious this
area right here produced a confirming

262
00:20:17,960 --> 00:20:24,940
account so that was also very
interesting and this whole move to

263
00:20:24,940 --> 00:20:31,740
200 suggests that this whole trading
range has been an accumulation so

264
00:20:31,740 --> 00:20:32,740
now

265
00:20:33,900 --> 00:20:38,340
and it has been kind of like a wholesome
trading range, right? So if this is the

266
00:20:38,340 --> 00:20:43,120
whole trading range, then the biggest
rally is going to be a major sign of

267
00:20:43,120 --> 00:20:44,560
strength. So we're confirming that.

268
00:20:44,860 --> 00:20:48,700
Then the next higher low is going to be
a last point of support.

269
00:20:49,360 --> 00:20:53,940
And then whatever comes before as the
lowest point is going to be phase C. And

270
00:20:53,940 --> 00:20:57,620
then before that, you know, however you
label this, everything is going to be

271
00:20:57,620 --> 00:20:58,599
fine.

272
00:20:58,600 --> 00:21:01,820
Well, the bias itself, obviously,

273
00:21:02,640 --> 00:21:05,260
has been given to us throughout the
whole structure.

274
00:21:05,620 --> 00:21:10,760
That's why I refer to the Wyckoff
analysis as a rolling over analysis.

275
00:21:11,080 --> 00:21:17,920
You kind of could see how the analysis
develops, how the story is being

276
00:21:17,920 --> 00:21:24,840
created. And the story is really being
created once Steve Jobs is coming back

277
00:21:24,840 --> 00:21:28,900
Apple. This is where the volume starts
to pick up a lot.

278
00:21:29,500 --> 00:21:33,600
And then look at the overall volume
signature on the major sign of strength.

279
00:21:33,980 --> 00:21:40,960
There are buyers all the way up to this
area right here. It's only in this area

280
00:21:40,960 --> 00:21:43,380
where the demand started to go down.

281
00:21:43,720 --> 00:21:47,780
But diminishing demand does not mean
that there are no buyers.

282
00:21:48,640 --> 00:21:52,020
Diminishing demand suggests that there
are fewer buyers.

283
00:21:52,340 --> 00:21:57,640
But even the fewer buyers could push the
price so significantly higher than the

284
00:21:57,640 --> 00:21:58,640
point of the resistance.

285
00:21:59,200 --> 00:22:00,880
from phases A and B.

286
00:22:01,840 --> 00:22:08,440
So therefore, we're seeing that all the
way on this rally, there is a lot of

287
00:22:08,440 --> 00:22:10,000
buying that's happening.

288
00:22:11,180 --> 00:22:16,680
And then obviously, the market happens
and there is a lot of capitulation

289
00:22:16,680 --> 00:22:20,220
by institutional trend followers.

290
00:22:23,640 --> 00:22:29,760
They capitulate at this point. At the
same time, The CO is

291
00:22:29,760 --> 00:22:36,440
seeing liquidity and value, and the CO

292
00:22:36,440 --> 00:22:39,220
picks it up on the way down.

293
00:22:40,060 --> 00:22:46,480
And then the stock shows a lot of
relative strength until this point where

294
00:22:46,480 --> 00:22:52,200
demand becomes a little bit urgent, it
increases, and that pushes the price to

295
00:22:52,200 --> 00:22:55,220
the new trajectory of a new uptrend.

296
00:22:56,940 --> 00:22:59,560
Now let's talk about the institutional
value zone.

297
00:22:59,820 --> 00:23:05,440
So how would we define where
institutions are interested in this

298
00:23:05,440 --> 00:23:10,920
stock? Well, we need to find the places
where the price stops on

299
00:23:10,920 --> 00:23:17,460
what we could interpret as institutional
buy -in

300
00:23:17,460 --> 00:23:24,120
because it's the stop in action and
subsequent

301
00:23:24,120 --> 00:23:30,920
demand that is being shown to us in that
stop in action would produce a

302
00:23:30,920 --> 00:23:35,860
suggestion that some big interests are
buying at this point of time.

303
00:23:36,360 --> 00:23:42,380
As well as any type of rallies off the
lows that would have a lot of volume

304
00:23:42,380 --> 00:23:43,380
characteristics.

305
00:23:44,240 --> 00:23:48,560
So this is definitely where institutions
are establishing their positions.

306
00:23:49,740 --> 00:23:56,080
Something like this could be observed in
the behaviors not of just the CEO, by

307
00:23:56,080 --> 00:24:00,320
itself, but also by institutional trend
followers.

308
00:24:00,640 --> 00:24:02,880
They will be buying on the way up.

309
00:24:03,280 --> 00:24:10,220
Their buying will create the waves, the
swings that we see

310
00:24:10,220 --> 00:24:11,219
on the chart.

311
00:24:11,220 --> 00:24:17,820
So here are the first time where the
price fails and is being supported of

312
00:24:17,820 --> 00:24:18,619
two bars.

313
00:24:18,620 --> 00:24:20,940
There is some increase in the volume
signature.

314
00:24:21,360 --> 00:24:26,800
So whoever was buying here on the way
up, was definitely giving up.

315
00:24:27,140 --> 00:24:31,120
But somebody was also buying at the same
time.

316
00:24:31,320 --> 00:24:36,420
So with that, one of the highest volume
signatures, we would be thinking that

317
00:24:36,420 --> 00:24:40,080
this is where the CEO might be coming in
and buying.

318
00:24:40,360 --> 00:24:46,480
And that CEO, this type of institution,
eventually will be wrong about this

319
00:24:46,480 --> 00:24:53,480
position. I was making an argument with
somebody this last week.

320
00:24:55,860 --> 00:25:02,860
about the CEO not necessarily being the
CEO on all of the

321
00:25:02,860 --> 00:25:03,860
trades.

322
00:25:05,660 --> 00:25:09,940
Can you imagine that institutions that
we think that they are CEO, like Warren

323
00:25:09,940 --> 00:25:12,420
Buffett's, that they make mistakes as
well?

324
00:25:13,620 --> 00:25:18,120
I mean, like if you study Warren
Buffett's trading history, you will see

325
00:25:18,120 --> 00:25:19,940
has made quite a few mistakes.

326
00:25:20,960 --> 00:25:27,320
So we can't really say that Warren
Buffett, was the CEO on all of his

327
00:25:28,140 --> 00:25:34,140
He definitely was the CEO in a lot of
the trades, and in some, he was wrong,

328
00:25:34,140 --> 00:25:35,140
he was weak hands.

329
00:25:36,220 --> 00:25:41,120
And he provided liquidity, and he
capitulated on the positions. One of the

330
00:25:41,120 --> 00:25:47,920
latest positions that I could think of
where he capitulated was IBM

331
00:25:47,920 --> 00:25:51,260
a couple of years ago, I believe.

332
00:25:51,930 --> 00:25:54,710
So we've talked about this in classes.

333
00:25:55,610 --> 00:26:00,890
But somebody is buying here as well as
somebody is buying right here on the way

334
00:26:00,890 --> 00:26:05,610
down because they're seeing with all of
this capitulation that some value comes

335
00:26:05,610 --> 00:26:06,610
into this area.

336
00:26:07,090 --> 00:26:12,870
So and then throughout this whole range,
this is where we're going to see,

337
00:26:12,990 --> 00:26:15,810
again, some elements of buying.

338
00:26:16,070 --> 00:26:22,970
Whenever the price goes below this
level, we would consider this an

339
00:26:22,970 --> 00:26:27,790
condition. And therefore, with the
oversold condition, there is some value

340
00:26:27,790 --> 00:26:31,590
institutions. And they would come in and
they would start buying. So for

341
00:26:31,590 --> 00:26:37,830
instance, like a bar like this, or a bar
like this, and so on and so forth.

342
00:26:38,070 --> 00:26:41,870
And we would be seeing these bars with
the increased demand signature.

343
00:26:42,230 --> 00:26:48,070
And again, it's going to take some time
for institutions that...

344
00:26:48,490 --> 00:26:54,610
we perceive as the CEO type of
institutions try to stop the price from

345
00:26:54,610 --> 00:27:00,950
lower down and yet failing every time.
There is failure number one.

346
00:27:02,850 --> 00:27:04,690
There is failure number two.

347
00:27:05,390 --> 00:27:06,450
Full starts.

348
00:27:09,030 --> 00:27:12,130
So here is where I don't want you to
think so linearly.

349
00:27:15,760 --> 00:27:20,340
When we see a big volume signature, we
know that huge institutions are coming

350
00:27:20,340 --> 00:27:21,340
and they are buying.

351
00:27:24,080 --> 00:27:30,940
And we're definitely thinking that this
is the CEO type

352
00:27:30,940 --> 00:27:31,940
of signature.

353
00:27:32,080 --> 00:27:37,380
But we know that even those big type of
institutions could fail.

354
00:27:38,560 --> 00:27:43,100
And they could produce a loss instead of
a win.

355
00:27:44,140 --> 00:27:48,520
So those will become not the COO, but we
can't.

356
00:27:48,780 --> 00:27:54,060
And we just need to technically identify
the areas where finally the bind by the

357
00:27:54,060 --> 00:27:58,040
institutional hands is going to prevail
into the uptrend.

358
00:27:59,680 --> 00:28:05,140
But we could identify the zone. Here is
the zone. And where it comes to the

359
00:28:05,140 --> 00:28:09,540
oversold condition, we would be
expecting that there's going to be some

360
00:28:09,540 --> 00:28:10,540
push to the upside.

361
00:28:11,320 --> 00:28:12,680
And then when it...

362
00:28:12,970 --> 00:28:19,210
over is is oversold again with the new
support area right here this is again

363
00:28:19,210 --> 00:28:26,070
where we're going to see a quick um rise
to the upside that would suggest

364
00:28:26,070 --> 00:28:31,330
that either supply is exhausted or there
are some buyers and they've seen this

365
00:28:31,330 --> 00:28:37,270
as a value and therefore they are biased
on this bar then again as the price

366
00:28:37,270 --> 00:28:43,990
comes down again we're seeing this
spring type action So, oversold

367
00:28:43,990 --> 00:28:50,870
a true value zone will always produce
this type of definition of

368
00:28:50,870 --> 00:28:57,730
how the price reacts in the B bottom,
quick recovery, quick momentum type

369
00:28:57,730 --> 00:29:00,830
of buying, just because they're seeing
value right there.

370
00:29:02,950 --> 00:29:06,250
All right, and then the next value.

371
00:29:08,400 --> 00:29:13,380
zone spot for us is somewhere here,
where we see that a lot of institutional

372
00:29:13,380 --> 00:29:16,420
followers, trend followers, have given
up.

373
00:29:16,660 --> 00:29:22,440
So the CEO is definitely seeing this as
an opportunity to buy, and it's buying

374
00:29:22,440 --> 00:29:24,940
exactly in this zone right here.

375
00:29:25,160 --> 00:29:32,100
So we finally see that instead of going
lower and creating lower lows, the value

376
00:29:32,100 --> 00:29:35,720
zone is being respected. So by itself,
it's a sign of strength.

377
00:29:36,670 --> 00:29:41,250
And then we're seeing the confirmation
by the volume that there is an

378
00:29:41,250 --> 00:29:45,730
institutional value buying on the short
-term liquidity and long -term value.

379
00:29:46,270 --> 00:29:51,170
They're thinking that this is a short
-term event with the long -term

380
00:29:51,170 --> 00:29:52,170
to the upside.

381
00:29:54,210 --> 00:29:58,090
All right, let's go to the next chart.

382
00:29:58,290 --> 00:30:01,010
Okay, actually a couple of questions
here.

383
00:30:06,330 --> 00:30:12,810
thinking about this as a long -term
trading range and taking your phase C

384
00:30:12,810 --> 00:30:16,350
labeling it a shakeout instead of a
spring.

385
00:30:16,890 --> 00:30:23,850
Is this correct or is this wrong? I
think that if you will be referring to

386
00:30:23,850 --> 00:30:29,650
support area that was created by the
automatic reaction, then the extent with

387
00:30:29,650 --> 00:30:35,620
which the price came down into phase C
could be interpreted as a shakeout.

388
00:30:35,920 --> 00:30:42,220
Having said this, this is not the first
or the last point of support that has

389
00:30:42,220 --> 00:30:44,060
been developed by this trading range.

390
00:30:44,260 --> 00:30:49,960
And therefore, all of this spring and
shakeout type of action will only be

391
00:30:49,960 --> 00:30:54,740
to us below any of the lowest support
that we could see.

392
00:30:55,220 --> 00:30:58,220
So where are the levels of the support?

393
00:30:58,460 --> 00:31:00,340
First level of the support.

394
00:31:01,200 --> 00:31:03,220
belongs to the automatic reaction.

395
00:31:03,560 --> 00:31:08,720
The second one belongs to the secondary
test with a sign of weakness or a

396
00:31:08,720 --> 00:31:09,800
localized spring.

397
00:31:10,120 --> 00:31:16,640
So we're already thinking that if price
goes down below this level, this is our

398
00:31:16,640 --> 00:31:21,280
oversold condition and not necessarily
this one, the upper one.

399
00:31:21,540 --> 00:31:27,940
So with this logic, we're thinking,
again, here is another one, here is

400
00:31:27,940 --> 00:31:28,940
one.

401
00:31:29,600 --> 00:31:35,520
it gradually goes down. The shakeout
action, we really would like to see more

402
00:31:35,520 --> 00:31:41,600
this quality, where there is no
laborious move to the downside.

403
00:31:41,800 --> 00:31:46,220
This is not how shakeout happens, and
this is exactly what's happening in this

404
00:31:46,220 --> 00:31:53,140
area, but more of kind of like a
catapult wall down, where

405
00:31:53,140 --> 00:31:54,840
everything goes down.

406
00:31:55,620 --> 00:31:57,560
That's a shakeout type of action.

407
00:31:58,010 --> 00:32:03,150
So just the texture, the character of
this is not of the shakeout type of

408
00:32:03,150 --> 00:32:04,150
quality.

409
00:32:04,330 --> 00:32:10,430
So therefore, this is just a trading
range that we will label as a strain and

410
00:32:10,430 --> 00:32:11,430
test.

411
00:32:12,890 --> 00:32:13,950
Next question.

412
00:32:18,290 --> 00:32:19,710
What is this software?

413
00:32:20,330 --> 00:32:23,090
It's already discontinued, so it doesn't
really matter.

414
00:32:23,930 --> 00:32:25,730
Isn't it a down move on increase?

415
00:32:26,240 --> 00:32:32,860
volume bearish sign right after 1991
okay so

416
00:32:32,860 --> 00:32:39,680
1991 uh down move on increased volume a
bearish sign this one right

417
00:32:39,680 --> 00:32:46,680
here yeah of course but you're thinking
you're thinking more um

418
00:32:46,680 --> 00:32:53,640
um that's kind of like a public here
because yes it is a bearish sign

419
00:32:53,640 --> 00:32:58,860
but For some of the institutions, this
is going to be a certain value,

420
00:32:59,060 --> 00:33:04,000
and they're going to be buyers at this
point.

421
00:33:04,260 --> 00:33:07,920
It doesn't mean that the price will go
up from here.

422
00:33:08,880 --> 00:33:13,160
No, but we're just recognizing that this
is the first time when they attempted

423
00:33:13,160 --> 00:33:13,999
to buy.

424
00:33:14,000 --> 00:33:17,400
So we want to see how the buying is
going to happen at this level.

425
00:33:17,740 --> 00:33:22,020
And look what's happening next, right?
So, for instance, right here, this was a

426
00:33:22,020 --> 00:33:23,060
very important spot.

427
00:33:23,840 --> 00:33:27,740
where the buying has happened again at
the same point.

428
00:33:28,140 --> 00:33:33,800
So that reconfirms that institutions are
willing and seeing the value here and

429
00:33:33,800 --> 00:33:34,800
they're willing to buy.

430
00:33:36,660 --> 00:33:37,660
All right.

431
00:33:41,800 --> 00:33:46,360
Can we label automatic reaction as a
shakeout?

432
00:33:46,600 --> 00:33:51,180
Yeah, you can definitely do this
because, again, it doesn't influence.

433
00:33:51,900 --> 00:33:57,520
your trade decision right here on the
screen so this could be a shakeout

434
00:33:57,520 --> 00:34:04,220
automatic reaction secondary test and
here's your phase a anyway so it

435
00:34:04,220 --> 00:34:10,440
doesn't really matter that much all
right let's go to the next one so this

436
00:34:10,440 --> 00:34:14,400
probably uh the hardest one so i've seen
a lot of the

437
00:34:15,430 --> 00:34:19,630
Different interpretations, and I thought
that, you know, let me go through

438
00:34:19,630 --> 00:34:24,790
different scenarios here. Everything
else was kind of okay, and that was so

439
00:34:24,790 --> 00:34:29,770
surprising. So I thought that the
difficulty was more in the nuances, more

440
00:34:29,770 --> 00:34:36,670
kind of like some details, some
variations.

441
00:34:37,530 --> 00:34:42,449
Everything else, really, you guys just
did phenomenal work with the homework.

442
00:34:42,830 --> 00:34:48,280
All right, so we've talked about, an
institutional value zone right so again

443
00:34:48,280 --> 00:34:53,520
would we define it we want to find the
first time when they are actually buying

444
00:34:53,520 --> 00:34:58,700
right so we don't see a lot of buying on
the way down so the volume signature is

445
00:34:58,700 --> 00:35:04,080
not increasing here on the climactic run
and that's fine sometimes that happens

446
00:35:04,080 --> 00:35:09,400
uh it's just again a variation which is
different from what we've seen let's say

447
00:35:09,400 --> 00:35:15,100
somewhere here um in this case the first
buying happens and then No buying

448
00:35:15,100 --> 00:35:22,060
again. This bar right here reflects
supply and suggests a move to

449
00:35:22,060 --> 00:35:24,360
the downside after a local upthrust.

450
00:35:25,160 --> 00:35:30,780
So we're really only seeing a buying
around this zone right here. So if we

451
00:35:30,780 --> 00:35:33,300
extend it, think about what happens
next.

452
00:35:33,700 --> 00:35:38,340
On the way down here, we see the volume
signature increase.

453
00:35:40,040 --> 00:35:44,920
This increase in volume spike suggests
that, well, first of all, supply is

454
00:35:44,920 --> 00:35:46,120
increasing a lot.

455
00:35:46,320 --> 00:35:48,740
But there is also increase of the
demand.

456
00:35:50,080 --> 00:35:53,700
And this increase of the demand we could
see from the daily spread.

457
00:35:54,280 --> 00:36:00,960
The daily spread is actually diminishing
relative to what we've seen before,

458
00:36:01,220 --> 00:36:06,820
right? So this gap down does not reflect
the volume, overnight volume. This is

459
00:36:06,820 --> 00:36:07,920
only the daily volume.

460
00:36:08,750 --> 00:36:15,070
So on the dimension daily spread with
the volume spike like this,

461
00:36:15,190 --> 00:36:20,390
that suggests the presence of the
demand, and not only the presence, but

462
00:36:20,390 --> 00:36:21,690
increase of the demand.

463
00:36:21,930 --> 00:36:27,050
An increase of the demand suggests that
absorption is underway.

464
00:36:27,950 --> 00:36:33,230
Plus, think about the character of this
demand. There is so much demand on this

465
00:36:33,230 --> 00:36:34,930
bar, hidden from us.

466
00:36:35,760 --> 00:36:41,680
that it observes the supply, and we
start thinking if the levels of demand

467
00:36:41,680 --> 00:36:45,160
so high, this is probably an
institutional demand.

468
00:36:46,880 --> 00:36:49,620
Where did we see demand before in this
area?

469
00:36:50,100 --> 00:36:50,979
Somewhere here.

470
00:36:50,980 --> 00:36:55,120
So it makes a lot of sense that they are
buying in the same zone.

471
00:36:55,880 --> 00:37:01,320
Because what's happening with
institutions is that they basically

472
00:37:01,320 --> 00:37:02,860
value zone for them, which...

473
00:37:03,400 --> 00:37:07,220
calling it exactly like this,
institutional value zone, and they are

474
00:37:07,220 --> 00:37:11,720
their traders, buy me everything between
50 and 70.

475
00:37:12,420 --> 00:37:18,580
And especially I'm interested if the
price goes below 50 because as an

476
00:37:18,580 --> 00:37:25,320
institutional trader, if you could get a
position at the lower

477
00:37:25,320 --> 00:37:26,960
prices, that's even better.

478
00:37:27,700 --> 00:37:30,860
And what happens when the price goes...

479
00:37:31,180 --> 00:37:37,720
below the value zone, it usually
produces a very quick reaction from

480
00:37:37,720 --> 00:37:43,580
institutional traders because they see
value and the price recovers quickly in

481
00:37:43,580 --> 00:37:44,760
the spring type of manner.

482
00:37:45,400 --> 00:37:50,620
So this spring is actually, you know,
this kind of like the analogy. Okay, I'm

483
00:37:50,620 --> 00:37:53,180
drawing this incorrectly totally, but
it's a spring, right?

484
00:37:53,520 --> 00:37:57,660
So it expands and contracts. You
could...

485
00:38:00,560 --> 00:38:06,760
You could push it together and then
allow it to expand, and it will do so

486
00:38:06,760 --> 00:38:07,760
quickly.

487
00:38:08,400 --> 00:38:11,560
The same happens in this spot.

488
00:38:12,100 --> 00:38:18,940
It really is a springing out of this
short

489
00:38:18,940 --> 00:38:19,960
-term value position.

490
00:38:20,300 --> 00:38:26,460
Look at the next oversold right here. It
goes down. What do we see with the

491
00:38:26,460 --> 00:38:27,460
volume signature?

492
00:38:27,720 --> 00:38:30,080
Right away, there is some demand that's
coming in.

493
00:38:30,440 --> 00:38:31,440
Why?

494
00:38:34,260 --> 00:38:37,480
Because there is value for institutions.

495
00:38:38,840 --> 00:38:44,740
And this value is actually extreme
because it's on the oversold condition.

496
00:38:45,160 --> 00:38:49,440
So how are they going to buy out of the
oversold? They're going to be more

497
00:38:49,440 --> 00:38:56,420
aggressive because it's below their
value zone.

498
00:38:56,830 --> 00:39:03,110
So here we are seeing this bind on the
way up. And this bind is going to stop

499
00:39:03,110 --> 00:39:05,850
once it goes above their value zone.

500
00:39:06,110 --> 00:39:11,770
So somewhere here we are seeing already
that more of weak hands are buying on

501
00:39:11,770 --> 00:39:12,770
the way up.

502
00:39:12,830 --> 00:39:18,830
And that produces some emergence of the
supply from

503
00:39:18,830 --> 00:39:20,630
professional hands.

504
00:39:21,900 --> 00:39:26,380
Because professional hands are seeing
this as a short -term overbought

505
00:39:26,380 --> 00:39:31,640
condition, and they're seeing this as a
deviation from the mean.

506
00:39:33,420 --> 00:39:37,980
They know that the price will come back
to the mean and probably will overthrow

507
00:39:37,980 --> 00:39:38,980
it again.

508
00:39:39,280 --> 00:39:44,140
So they're shorting into the weak hands
liquidity at this spot.

509
00:39:52,140 --> 00:39:57,180
And then as the price goes down again,
this action repeats.

510
00:39:57,900 --> 00:40:04,580
An oversold condition for institutions
below the value zone creates

511
00:40:04,580 --> 00:40:07,980
a very quick pickup by institutions.

512
00:40:08,200 --> 00:40:10,540
And we see that again in the volume
signature.

513
00:40:11,740 --> 00:40:18,260
And then overall, we're definitely
trying to see the overall increase in

514
00:40:18,260 --> 00:40:20,500
volume signature relative to what we've
seen.

515
00:40:20,890 --> 00:40:27,830
in this area and in this area right here
we can see that there there are so many

516
00:40:27,830 --> 00:40:34,410
more institutions that are participating
in this rally that suggest a

517
00:40:34,410 --> 00:40:41,370
beginning of a trend and specifically
uptrend and not

518
00:40:41,370 --> 00:40:45,670
only that um institutional participation

519
00:40:47,850 --> 00:40:50,910
And again, this is where Steve Jobs came
back.

520
00:40:53,890 --> 00:40:59,750
Institutional participation suggests
that this is going to be a long -term

521
00:40:59,750 --> 00:41:00,750
trend.

522
00:41:01,510 --> 00:41:08,510
So this type of moves out of the lows,
cyclical lows

523
00:41:08,510 --> 00:41:13,510
or secular lows in the stock or in the
market, with this type of volume

524
00:41:13,510 --> 00:41:15,910
signature that suggests that
institutional participation.

525
00:41:16,840 --> 00:41:23,620
are the best indications for timing for
us for a very big move to the

526
00:41:23,620 --> 00:41:28,920
upside that is going to be cyclical in
nature. And you could be thinking about

527
00:41:28,920 --> 00:41:33,960
different tactics there, how to trade
it. You could be thinking about trading

528
00:41:33,960 --> 00:41:38,620
as a long -term position. You could be
thinking about trading it as a multiple

529
00:41:38,620 --> 00:41:40,760
swing position and so on and so forth.

530
00:41:42,160 --> 00:41:46,680
Well, if there is an institutional value
zone, then we probably would be

531
00:41:46,680 --> 00:41:53,040
thinking about some value zones for weak
hands as well. Please note that I'm

532
00:41:53,040 --> 00:41:58,720
saying here weak hands just because it's
both institutions and public.

533
00:41:59,500 --> 00:42:04,120
And how would we define the weak hands
value?

534
00:42:04,320 --> 00:42:09,200
So obviously weak hands value zone is
going to be associated with the

535
00:42:09,200 --> 00:42:10,200
distribution.

536
00:42:10,320 --> 00:42:16,420
If the institutional value zone is
usually associated with accumulation,

537
00:42:16,820 --> 00:42:21,680
reaccumulation, then weak hands value
zone is going to be a distribution or

538
00:42:21,680 --> 00:42:28,140
redistribution. So thinking about the
concepts of the weak hands and

539
00:42:28,140 --> 00:42:33,960
where, for the first time, they will be
excited

540
00:42:33,960 --> 00:42:38,580
about the uptrend.

541
00:42:38,990 --> 00:42:45,790
it comes on the last climactic run into
the top of the market, into the buying

542
00:42:45,790 --> 00:42:52,750
climax. So we're seeing some buying on
the way up in this climactic

543
00:42:52,750 --> 00:42:57,950
run, and we define this as an excitement
or the first point of excitement

544
00:42:57,950 --> 00:43:02,690
by weak hands.

545
00:43:04,210 --> 00:43:07,210
So this excitement by weak hands
produces...

546
00:43:09,260 --> 00:43:16,020
weak hands buying into stopping action.

547
00:43:19,100 --> 00:43:23,440
Well, why does this happen? Well,
because CO is not buying.

548
00:43:26,920 --> 00:43:30,980
ITF are in the position.

549
00:43:33,500 --> 00:43:35,520
So they're not biased either.

550
00:43:39,630 --> 00:43:46,370
And they still do not provide a lot of
supply to the market.

551
00:43:47,810 --> 00:43:53,090
So therefore, this is one of the spots
where weak hands

552
00:43:53,090 --> 00:43:55,910
are going to do two things.

553
00:43:56,870 --> 00:44:00,210
They're going to be enjoying the
profits.

554
00:44:01,390 --> 00:44:06,230
They're going to be profitable on the
left leg to the upside.

555
00:44:07,070 --> 00:44:09,230
And then they are going to be also

556
00:44:09,230 --> 00:44:15,910
able to move the price up.

557
00:44:16,510 --> 00:44:23,090
This is one of the spots where public,
or weak hands rather, can have a

558
00:44:23,090 --> 00:44:24,850
big influence on the price.

559
00:44:26,290 --> 00:44:33,190
So, ability to move price

560
00:44:33,190 --> 00:44:34,190
up.

561
00:44:36,780 --> 00:44:41,620
So these are two attributes that are
extremely important for us to remember

562
00:44:41,620 --> 00:44:43,660
this spot for weak hands.

563
00:44:44,640 --> 00:44:49,780
Just because this is where they see the
value.

564
00:44:50,720 --> 00:44:57,440
Now think about if they saw the value on
the way up, as the price goes down and

565
00:44:57,440 --> 00:45:00,440
goes below this value zone, how are they
going to view this?

566
00:45:00,940 --> 00:45:02,780
They're probably going to view this

567
00:45:03,920 --> 00:45:07,560
as an oversold condition and a point of
value to them.

568
00:45:08,000 --> 00:45:11,560
So what are they going to do? They're
going to buy at this spot.

569
00:45:12,240 --> 00:45:13,380
So we can't.

570
00:45:15,320 --> 00:45:21,300
And they're going to say that, oh my
gosh, this stock has been so good in

571
00:45:21,300 --> 00:45:27,880
uptrend and I'm going to load up more.

572
00:45:28,160 --> 00:45:34,150
And if they have not been in that
position by this time, this could be the

573
00:45:34,150 --> 00:45:35,270
time when they get in.

574
00:45:35,610 --> 00:45:38,390
Now think about what has happened on the
way down.

575
00:45:38,830 --> 00:45:43,890
A change of character suggested that the
CO is selling.

576
00:45:45,370 --> 00:45:50,530
And also ITFs also identifying this as a
trend failure, so they are selling as

577
00:45:50,530 --> 00:45:51,530
well.

578
00:45:53,070 --> 00:45:58,430
So the weak hands is effectively buying
the supply from strong hands.

579
00:46:00,030 --> 00:46:06,760
And for a moment, there is a balance and
absorption of supply and

580
00:46:06,760 --> 00:46:11,740
uh that suggests the reaction to the
upside

581
00:46:11,740 --> 00:46:16,560
which follows

582
00:46:16,560 --> 00:46:23,420
and in this whole reaction right here

583
00:46:23,420 --> 00:46:27,340
to the upside counter to the change of
character move

584
00:46:28,290 --> 00:46:33,670
we don't see a lot of the institutional
signature, and yet the price goes up.

585
00:46:34,910 --> 00:46:40,470
So that suggests that this type of
signature is weak -hand signature, and

586
00:46:40,470 --> 00:46:46,650
institutions were active or actively
selling on the way up, on the way down,

587
00:46:46,650 --> 00:46:47,830
then they are inactive.

588
00:46:49,370 --> 00:46:56,090
This inactivity produces a failed
upthrust, which we could label as a

589
00:46:56,090 --> 00:46:57,090
tax.

590
00:46:57,230 --> 00:47:03,450
It's an attempt to upthrust above a
buying climax, but we can't even do

591
00:47:03,650 --> 00:47:05,510
So here is a failed upthrust.

592
00:47:08,230 --> 00:47:14,410
And then there is some further
capitulation by institutions,

593
00:47:14,870 --> 00:47:17,450
probably just ITFs.

594
00:47:18,510 --> 00:47:23,270
They are not seeing the trend, the
stock, for quite some time.

595
00:47:23,910 --> 00:47:29,370
multiple quarters is not producing the
result, absolute result.

596
00:47:29,610 --> 00:47:34,650
And we'll have to think about what the
market was doing at this time and to see

597
00:47:34,650 --> 00:47:38,410
what the stock is doing. I would say
that it's probably still outperforming

598
00:47:38,410 --> 00:47:41,130
market at this point, maybe. That's just
my guess.

599
00:47:42,870 --> 00:47:49,570
And then weak hands are still seeing
this stop in action here as a value

600
00:47:49,910 --> 00:47:51,290
And look at their signature.

601
00:47:52,080 --> 00:47:56,780
It's kind of mediocre just because weak
hands do not have a huge signature,

602
00:47:57,100 --> 00:47:58,100
volume signature.

603
00:47:58,280 --> 00:48:03,700
And then there is another failed up
thrust, which we will label as an LPSY

604
00:48:03,700 --> 00:48:09,680
because this is phase C. Phase C
actually has two LPSs. One of them is

605
00:48:09,680 --> 00:48:12,840
failed up thrust. Another one, LPS as a
test.

606
00:48:13,700 --> 00:48:20,040
Then out of that, we see in the TP
formation or in the apex formation,

607
00:48:22,000 --> 00:48:28,180
a quick move to the downside, and then
on the increasing volume signature. So

608
00:48:28,180 --> 00:48:32,540
that suggests a late institutional
capitulation. Usually this volume

609
00:48:32,540 --> 00:48:38,640
will move us away from the trading range
that we have had.

610
00:48:38,940 --> 00:48:42,980
Now think about, again, the weak hands
value zone.

611
00:48:44,940 --> 00:48:49,900
As the price comes back to this value
zone, what do you think?

612
00:48:50,350 --> 00:48:56,470
um you know weak hands are doing they're
getting more and more excited right

613
00:48:56,470 --> 00:49:01,470
because this is where they bought before
in their minds if i bought there before

614
00:49:01,470 --> 00:49:06,550
and the price was able from the lows to
come back to this level this is very

615
00:49:06,550 --> 00:49:12,590
bullish so i'm going to be buying again
so uh into this buying

616
00:49:12,590 --> 00:49:19,340
by weekends and we see an excitement
with each of the rally with each of the

617
00:49:19,340 --> 00:49:25,940
thrusts to the upside so multiple up
thrust situations one two three

618
00:49:25,940 --> 00:49:32,880
into the weak hands value zone and every
time it happens institutions

619
00:49:32,880 --> 00:49:39,420
are selling on that excitement of
weekends so there is increase of the

620
00:49:39,420 --> 00:49:42,000
here increase of the supply here

621
00:49:42,990 --> 00:49:48,170
increase of the supply going into this
area right here as well.

622
00:49:49,290 --> 00:49:56,150
And institutions know that for them the
bias is to the downside. And they

623
00:49:56,150 --> 00:50:00,330
know that at this point of time, this is
an overbought condition.

624
00:50:00,890 --> 00:50:07,150
And they are looking for short -term
liquidity, which is being created by

625
00:50:07,150 --> 00:50:08,150
weekends.

626
00:50:09,480 --> 00:50:13,640
by the excitement of weekends, and they
just sell into this excitement.

627
00:50:14,360 --> 00:50:17,880
So that produces more selling and so on
and so forth.

628
00:50:18,260 --> 00:50:20,880
All right, let's go to the questions on
this.

629
00:50:24,340 --> 00:50:31,180
So trading range, phase C, not as

630
00:50:31,180 --> 00:50:36,240
spring as a question. Well, I don't know
if you guys could see this, but this

631
00:50:36,240 --> 00:50:37,820
low is just ever slightly.

632
00:50:38,650 --> 00:50:43,390
a higher low and it's not a lower low so
with the higher low we definitely would

633
00:50:43,390 --> 00:50:49,170
put left point of support rather than
the spring we could label this secondary

634
00:50:49,170 --> 00:50:55,930
test as a sign of weakness as the spring
type action we could do that

635
00:50:55,930 --> 00:51:01,990
we could label this whole thing as a c
phase c sometimes phase c would have

636
00:51:01,990 --> 00:51:08,510
type of you know spring and then the
test and I'm thinking about this. I

637
00:51:08,510 --> 00:51:09,930
probably relabel this now.

638
00:51:10,150 --> 00:51:17,090
I would probably just label it like
this, phase C. So then a spring and

639
00:51:17,090 --> 00:51:18,090
a cuff.

640
00:51:18,610 --> 00:51:21,810
But this one right here is a high -low.

641
00:51:23,410 --> 00:51:30,110
All right, first trading range, phase C,
failed upthrust, not upthrust of the

642
00:51:30,110 --> 00:51:31,110
distribution.

643
00:51:32,970 --> 00:51:37,570
Okay, guys, so this is one of the things
that I want to talk to you about. So

644
00:51:37,570 --> 00:51:41,510
it's very interesting. For some reason,
this group was like this.

645
00:51:42,330 --> 00:51:49,310
So what I really would like you to do is
to make

646
00:51:49,310 --> 00:51:56,170
sure that you go and you study all of
the concepts that, you know, I taught

647
00:51:56,170 --> 00:52:01,770
guys. Because sometimes I feel that
Something that was taught and we're

648
00:52:01,770 --> 00:52:06,170
back to the same question because people
just don't kind of like go and study

649
00:52:06,170 --> 00:52:07,210
this material.

650
00:52:07,650 --> 00:52:10,710
This is awfully inefficient.

651
00:52:11,530 --> 00:52:17,990
So I would really urge you to study all
of the Wyckoff events, the sequence of

652
00:52:17,990 --> 00:52:20,750
those events, how they come and the
characteristics.

653
00:52:21,230 --> 00:52:25,350
So a question about the upthrust of the
distribution.

654
00:52:25,790 --> 00:52:27,230
So think about...

655
00:52:27,480 --> 00:52:32,580
the question itself right so we're
saying that there is an up thrust after

656
00:52:32,580 --> 00:52:38,640
distribution so just after distribution
part is definitely okay but the up

657
00:52:38,640 --> 00:52:44,660
thrust is not why well because we don't
really have an up thrust here right how

658
00:52:44,660 --> 00:52:50,240
do we define the up thrust we define the
up thrust as the price overcoming the

659
00:52:50,240 --> 00:52:51,240
resistance

660
00:52:51,880 --> 00:52:56,840
temporarily committing to the upside or
attempting to commit, and then falling

661
00:52:56,840 --> 00:52:58,600
back into the trading range.

662
00:52:59,140 --> 00:53:02,120
Do we see this type of action on this
high?

663
00:53:02,760 --> 00:53:03,760
No.

664
00:53:04,060 --> 00:53:08,340
We are failing. That's why the label in
here is a failed upthrust.

665
00:53:08,840 --> 00:53:11,200
Do we do this on the next high?

666
00:53:11,740 --> 00:53:17,020
No, it's a lower high. So again, we
cannot overcome it. So we can't really

667
00:53:17,020 --> 00:53:18,020
this.

668
00:53:19,420 --> 00:53:23,760
an upthrust of the distribution just
because definitionally it's incorrect.

669
00:53:25,360 --> 00:53:31,580
So I would urge you to make sure that
you understand in what kind of,

670
00:53:31,640 --> 00:53:38,480
very simplistically, if this is going to
be a higher high in

671
00:53:38,480 --> 00:53:42,880
phase C for the distribution, this is
going to be upthrust of the

672
00:53:43,240 --> 00:53:47,140
If this is a lower high, then it's
always going to be a less point of

673
00:53:47,720 --> 00:53:51,940
You can remember it like this. But I
want you to remember because this is the

674
00:53:51,940 --> 00:53:54,340
second session where I kind of see this
tendency.

675
00:53:55,040 --> 00:53:58,360
And I definitely want to go away from
this.

676
00:54:03,520 --> 00:54:06,500
First rally into the buying climax.

677
00:54:07,740 --> 00:54:10,560
How do we know that CEO is not buying?

678
00:54:12,040 --> 00:54:16,160
So I'm assuming probably right here,
right?

679
00:54:17,770 --> 00:54:21,050
So how do we know volume signature by
itself?

680
00:54:21,370 --> 00:54:23,090
Not that big, right?

681
00:54:23,430 --> 00:54:26,130
We also would be thinking if this is a
sign of strength.

682
00:54:27,130 --> 00:54:33,650
So we want to see some kind of urgent
buying by the seal and

683
00:54:33,650 --> 00:54:40,110
something maybe like this, right, where
the signature is still consistently

684
00:54:40,110 --> 00:54:44,910
increasing and there is some urgency to
get into this position.

685
00:54:45,600 --> 00:54:52,120
This is more of the technical rally
where the volume does not fully

686
00:54:52,120 --> 00:54:55,920
confirm what the price is doing.

687
00:54:56,640 --> 00:55:02,380
And that would be our first guess. But
then we could just say that, well, maybe

688
00:55:02,380 --> 00:55:07,300
they are buying. And then we can only
know that they were not probably on the

689
00:55:07,300 --> 00:55:09,820
next change of character that falls into
the range.

690
00:55:10,760 --> 00:55:15,840
So we could make a mistake there, you
know, an interpretation that would be

691
00:55:15,840 --> 00:55:20,600
erroneous, but I think this mistake you
could quickly correct on the next

692
00:55:20,600 --> 00:55:24,860
reaction because you would be thinking,
why is it that the volume signature

693
00:55:24,860 --> 00:55:29,540
increases so substantially over what we
thought the institutional bias?

694
00:55:30,200 --> 00:55:33,640
That should produce some kind of
hesitation and thought there.

695
00:55:34,320 --> 00:55:35,320
All right.

696
00:55:42,820 --> 00:55:45,060
Okay, so from Eric.

697
00:55:46,080 --> 00:55:47,920
Let me see. I'm on in the second.

698
00:55:49,000 --> 00:55:51,020
I'm trying to see the whole question.

699
00:55:51,340 --> 00:55:58,320
Okay, here we go. In the second
redistribution, trading range in

700
00:55:58,320 --> 00:55:59,320
1995.

701
00:56:01,680 --> 00:56:07,760
We have an upthrust of the distribution
below the resistance line. Bruce Frazier

702
00:56:07,760 --> 00:56:14,300
in StockShare defined FAC with LPSY in
one of his distribution schematics when

703
00:56:14,300 --> 00:56:21,040
price does not go up. Why label upthrust
of the distribution instead of LPSY

704
00:56:21,040 --> 00:56:22,019
as Bruce?

705
00:56:22,020 --> 00:56:26,720
Well, I think that you are misreading
what Bruce is saying.

706
00:56:26,920 --> 00:56:28,660
There are two types of...

707
00:56:29,790 --> 00:56:34,170
Again, we're kind of repeating this, but
okay, let's just stay here. Let's just

708
00:56:34,170 --> 00:56:35,170
stay in this space.

709
00:56:36,850 --> 00:56:39,570
So two types of phase C that could
happen.

710
00:56:41,130 --> 00:56:48,130
So you have to be extremely careful how
you refer to Bruce's work, because I'm

711
00:56:48,130 --> 00:56:54,570
sure that Bruce would agree here with
me. Phase C, as a lower high,

712
00:56:54,730 --> 00:56:57,970
is going to be labeled left point of
supply.

713
00:56:58,520 --> 00:57:01,500
like we've labeled it here and here.

714
00:57:03,820 --> 00:57:10,280
In a different distributional pattern,
where we're going to have an upthrust of

715
00:57:10,280 --> 00:57:17,180
the distribution, and this is going to
be a higher

716
00:57:17,180 --> 00:57:22,320
high. A higher high is going to be
labeled as an upthrust, but because this

717
00:57:22,320 --> 00:57:26,540
distribution of the distribution, this
is a legacy name, as I mentioned to you.

718
00:57:26,810 --> 00:57:32,610
before so these are the two types and
these are the only labeling

719
00:57:32,610 --> 00:57:38,890
that the method has presented to you so
i'm sure that you know you're probably

720
00:57:38,890 --> 00:57:45,270
looking into one of the other schematics
um which bruce has shown so

721
00:57:45,270 --> 00:57:52,130
eric please come back to that particular
blog by bruce and reread it i'm sure

722
00:57:52,130 --> 00:57:53,530
you just you know

723
00:57:54,360 --> 00:57:59,360
remembering it incorrectly and if you
find it with the different type of

724
00:57:59,360 --> 00:58:04,400
labeling you know just email me the link
and we'll be very curious to see if

725
00:58:04,400 --> 00:58:11,340
that's true okay um all right let's kind
of go away

726
00:58:11,340 --> 00:58:18,200
from all of this um i'm feeling that um
we need to speed up a little bit okay

727
00:58:18,200 --> 00:58:24,280
so next chart this is also you know one
nuance here for this particular chart.

728
00:58:24,940 --> 00:58:30,240
You could take the whole formation here
and just say that this is our phase C,

729
00:58:30,460 --> 00:58:35,760
this is our phase A, this is our phase
B, and then we have a very prolonged

730
00:58:35,760 --> 00:58:36,760
phase D.

731
00:58:37,060 --> 00:58:39,180
That would be acceptable, absolutely.

732
00:58:39,600 --> 00:58:45,220
You could also think about two trading
ranges, first trading range and then a

733
00:58:45,220 --> 00:58:50,740
second trading range. And I forgot who
it was, but a couple of people actually.

734
00:58:51,240 --> 00:58:52,640
did it exactly this way.

735
00:58:53,460 --> 00:58:59,940
So that makes a lot of sense to me. Why?
Because I see that the texture here is

736
00:58:59,940 --> 00:59:00,859
somewhat different.

737
00:59:00,860 --> 00:59:05,160
This is a leadership stock that is being
distributed on the way up.

738
00:59:05,560 --> 00:59:11,080
And then after a major sign of weakness,
we're seeing that the texture is

739
00:59:11,080 --> 00:59:12,080
somewhat different.

740
00:59:14,120 --> 00:59:18,980
Let's talk about Opsros here so that we
would not confuse again, you know, the

741
00:59:18,980 --> 00:59:19,980
labeling.

742
00:59:20,320 --> 00:59:25,680
So we are definitely showing an upthrust
here, right, because we are overcoming

743
00:59:25,680 --> 00:59:29,800
the resistance and then we are coming
back into the trading range. So this is

744
00:59:29,800 --> 00:59:31,800
upthrust because this is a distribution.

745
00:59:32,260 --> 00:59:34,360
This is an upthrust of the distribution.

746
00:59:34,800 --> 00:59:38,600
The same thing here. We're seeing a
higher high.

747
00:59:38,860 --> 00:59:43,300
A higher high will be labeled in the
distribution or redistribution as an

748
00:59:43,300 --> 00:59:44,580
upthrust of the distribution.

749
00:59:45,470 --> 00:59:52,150
a lower high will be labeled as a last
point of supply if we would have had

750
00:59:52,150 --> 00:59:56,070
a lower low let's say after this up
thrust right here and we would have

751
00:59:56,070 --> 01:00:00,910
something like akin to this then this
point would be labeled as last point of

752
01:00:00,910 --> 01:00:07,250
supply if we would have had a failed up
thrust that does not

753
01:00:08,600 --> 01:00:14,220
overcome the point of the resistance and
this becomes the lower high, then we

754
01:00:14,220 --> 01:00:17,920
are definitely labeling this as our last
point of supply.

755
01:00:18,300 --> 01:00:23,900
So Eric and Philip, please make sure
that you come back to the material,

756
01:00:23,900 --> 01:00:26,680
it, and understand why we are labeling
it this way.

757
01:00:27,920 --> 01:00:33,920
Okay, so another point right here, you
know, was the question of why such a big

758
01:00:33,920 --> 01:00:34,920
gap.

759
01:00:38,759 --> 01:00:41,780
Eric, but yes, I see that you got it.

760
01:00:42,660 --> 01:00:45,900
I understand that you got it. But my
point is not that.

761
01:00:46,340 --> 01:00:51,320
My point as a teacher, I want you to
learn the stuff that I'm giving you and

762
01:00:51,320 --> 01:00:52,680
to re -ask the same question.

763
01:00:52,920 --> 01:00:58,480
So that's kind of like a point that I'm
trying to make. So hopefully you'll kind

764
01:00:58,480 --> 01:01:02,720
of like appreciate the thought behind
this because it influences the whole

765
01:01:02,720 --> 01:01:03,720
class.

766
01:01:06,410 --> 01:01:09,410
The question of why such a big gap?

767
01:01:10,590 --> 01:01:13,430
So let's think about what is happening
here.

768
01:01:14,890 --> 01:01:19,110
And I know that a lot of you are going
to say, yes, it's an institutional

769
01:01:19,110 --> 01:01:23,550
capitulation and liquidation of their
position.

770
01:01:23,870 --> 01:01:29,690
But the question is not about why
institutions are capitulating or why the

771
01:01:29,690 --> 01:01:30,669
has happened.

772
01:01:30,670 --> 01:01:33,770
The question is more of why a big gap?

773
01:01:34,280 --> 01:01:39,180
So I wonder what you think about this. I
think that I've given you enough logic

774
01:01:39,180 --> 01:01:41,800
already throughout this, you know, five,
six sessions.

775
01:01:42,440 --> 01:01:45,200
So write it down. Write down your
thoughts, guys.

776
01:01:45,680 --> 01:01:47,340
Let's kind of speculate here.

777
01:01:47,700 --> 01:01:51,320
Why do we have such a big gap?

778
01:01:51,740 --> 01:01:58,720
And big is, you know, is kind of like
what I want to hear from you for

779
01:01:58,720 --> 01:02:00,300
the reasons of why.

780
01:02:00,540 --> 01:02:05,420
While you're thinking about this, Let me
go really quickly through the weak

781
01:02:05,420 --> 01:02:06,460
hands value zone.

782
01:02:07,380 --> 01:02:12,500
So thinking about that this is a
distribution, we would be thinking about

783
01:02:12,500 --> 01:02:17,580
hands seeing some kind of value zone and
being buyers,

784
01:02:17,900 --> 01:02:20,760
right?

785
01:02:21,700 --> 01:02:25,240
So where would they be excited for the
first time?

786
01:02:25,520 --> 01:02:30,580
Into the climactic run, right? So all of
this movement.

787
01:02:32,750 --> 01:02:36,930
is going to be weak hands first point of
excitement.

788
01:02:42,130 --> 01:02:46,430
And we could see that weak hands operate
here.

789
01:02:46,650 --> 01:02:48,430
Why? Because of the volume signature.

790
01:02:48,790 --> 01:02:54,510
It's insignificant and yet the price
runs up. So it tells us that the CO is

791
01:02:54,510 --> 01:02:58,150
still holding on to the position and
does not provide...

792
01:02:59,210 --> 01:03:02,710
a huge supply to stop the price from
going further up.

793
01:03:03,930 --> 01:03:07,770
And weak hands are in control of this
market.

794
01:03:08,630 --> 01:03:13,370
Institutional trend followers, hence,
they're still in the position, they're

795
01:03:13,370 --> 01:03:17,450
enjoying the run, they're making more
money, but they're not distributing

796
01:03:17,450 --> 01:03:22,790
because the definition of the trend was
not violated.

797
01:03:23,790 --> 01:03:30,790
So we see from the volume signature that
this is definitely weak hands operating

798
01:03:30,790 --> 01:03:32,230
at this point of time.

799
01:03:32,490 --> 01:03:39,430
So therefore, their value zone is going
to be somewhere on the last run into the

800
01:03:39,430 --> 01:03:44,110
buying climax where we see some kind of
not substantial buying.

801
01:03:44,510 --> 01:03:48,130
And it happens with all of these bars
right here.

802
01:03:48,430 --> 01:03:49,750
And then throughout...

803
01:03:49,980 --> 01:03:53,840
this structure right here that looks
like a reaccumulation in the

804
01:03:54,280 --> 01:04:01,280
we're going to notice how the casting is
going to be done and

805
01:04:01,280 --> 01:04:06,420
how the bind is going to occur also at
the specific spots.

806
01:04:06,640 --> 01:04:10,400
And we want to catch this bind as a
value zone as well.

807
01:04:11,840 --> 01:04:15,340
And then extend this value zone
throughout this whole zone.

808
01:04:16,680 --> 01:04:20,220
So thinking about the value zone, we
obviously will be thinking about the

809
01:04:20,220 --> 01:04:22,280
overbought condition and the oversold
condition.

810
01:04:23,100 --> 01:04:29,720
So every time we're going to go into the
overbought condition, the

811
01:04:29,720 --> 01:04:34,080
behavior of the institutions and the
composite men are going to change.

812
01:04:34,680 --> 01:04:38,120
The composite men is going to start
selling.

813
01:04:40,200 --> 01:04:42,360
That will produce a reaction.

814
01:04:44,460 --> 01:04:49,980
On this reaction, we could see some kind
of violation of the trend.

815
01:04:52,000 --> 01:04:58,600
With this violation of the trend, we
will see capitulation by institutional

816
01:04:58,600 --> 01:04:59,660
trend followers.

817
01:05:00,520 --> 01:05:05,840
And this capitulation is going to be
early capitulation.

818
01:05:06,480 --> 01:05:10,460
And it's going to be not substantial.

819
01:05:14,920 --> 01:05:18,300
They're going to capitulate around this
area right here.

820
01:05:19,060 --> 01:05:22,480
But we have seen from the volume
signature, how much did they capitulate?

821
01:05:23,480 --> 01:05:24,720
Did they sell a lot?

822
01:05:25,320 --> 01:05:26,320
Probably not.

823
01:05:26,620 --> 01:05:29,900
At this point of time, Apple is a very
hot commodity.

824
01:05:31,280 --> 01:05:38,200
It went up, I think, times five, if I'm
not mistaken, off the

825
01:05:38,200 --> 01:05:40,680
lows in 96, even probably more.

826
01:05:41,320 --> 01:05:43,780
We could look at this on the first
slide.

827
01:05:44,380 --> 01:05:49,840
So what do you think institutions are
doing here? They are unwilling sellers

828
01:05:49,840 --> 01:05:56,360
here, and they are probably just
slightly scaling out.

829
01:06:00,040 --> 01:06:05,440
So we don't see a lot of institutional
selling.

830
01:06:13,390 --> 01:06:15,910
And that happens throughout this whole
trading range.

831
01:06:19,710 --> 01:06:21,210
Look at the volume signature.

832
01:06:22,210 --> 01:06:27,450
Obviously, because of this spike right
here, we can't really see a lot, but we

833
01:06:27,450 --> 01:06:32,590
could distinct that this was the area of
where selling has happened on the way

834
01:06:32,590 --> 01:06:37,690
down. This is probably just early
institutional trend fall and

835
01:06:37,690 --> 01:06:39,210
has been selling throughout.

836
01:06:42,120 --> 01:06:48,980
Once the price comes back close to

837
01:06:48,980 --> 01:06:50,840
the overbought condition, what happens?

838
01:06:51,100 --> 01:06:53,620
We're going down. We're going down.

839
01:06:54,400 --> 01:07:00,000
Now back to the question of why such a
big gap.

840
01:07:00,640 --> 01:07:06,180
Well, usually CO and institutional trend
followers are going to start selling

841
01:07:06,180 --> 01:07:09,320
in a kind of...

842
01:07:13,110 --> 01:07:18,090
sequential way, right? So they will sell
into the buying climax. They will sell

843
01:07:18,090 --> 01:07:24,350
into the change of character. They will
sell into the height of phase B. They

844
01:07:24,350 --> 01:07:28,870
will sell into the phase C. They will
sell on the major sign of weakness.

845
01:07:29,170 --> 01:07:32,830
And then they're going to repeat this
process over and over.

846
01:07:33,490 --> 01:07:39,630
But there is not really a lot of selling
here just because the price stays up.

847
01:07:39,920 --> 01:07:43,220
Think about also what's happening in
this area in the market.

848
01:07:44,240 --> 01:07:47,680
So the market had topped in March.

849
01:07:51,860 --> 01:07:57,500
And then it had a very big decline into
August, September.

850
01:08:03,080 --> 01:08:08,920
So think about how Apple is being seen
in this moment of the market history.

851
01:08:09,600 --> 01:08:16,340
it's definitely seen as a defensive
stock.

852
01:08:19,859 --> 01:08:21,500
Why defensive stock?

853
01:08:21,740 --> 01:08:28,380
Well, because it doesn't lose value and
it doesn't lose relative

854
01:08:28,380 --> 01:08:33,939
value. The market is going down, so
relative to the market and to the peers

855
01:08:33,939 --> 01:08:37,460
to a lot of the stocks, Apple is at...

856
01:08:38,430 --> 01:08:41,090
the point of value for a lot of
institutions.

857
01:08:41,470 --> 01:08:43,590
They are not giving up this position.

858
01:08:44,290 --> 01:08:51,130
So when the price starts to capitulate,
and obviously that could happen on

859
01:08:51,130 --> 01:08:57,670
some earnings and on some events, this
is where they're going to capitulate.

860
01:08:57,770 --> 01:09:04,390
But because of how quickly from the
value zone for a lot of the

861
01:09:04,390 --> 01:09:10,840
institutions that became weak hands by
holding the stock, And it drops so much.

862
01:09:11,000 --> 01:09:12,660
What do you think they're going to do?

863
01:09:13,319 --> 01:09:17,359
They're going to capitulate. This is the
event where they're saying like, okay,

864
01:09:17,420 --> 01:09:18,420
I'm done.

865
01:09:19,260 --> 01:09:20,399
I'm going to go away.

866
01:09:21,600 --> 01:09:23,540
So take me out at any price.

867
01:09:24,260 --> 01:09:31,200
And that's why the price drops so much
because the demand to sell is so huge

868
01:09:31,200 --> 01:09:35,380
among institutions overnight. It opens
up with the gap.

869
01:09:36,830 --> 01:09:41,370
so much selling that is happening at the
same time during the day. Now, somebody

870
01:09:41,370 --> 01:09:42,370
is already buying.

871
01:09:42,390 --> 01:09:47,170
There are buyers on the way down all the
way because they are thinking at this

872
01:09:47,170 --> 01:09:54,029
price, relative to where it was, this is
what, you know,

873
01:09:54,050 --> 01:09:55,910
50 % down, if not more.

874
01:09:56,410 --> 01:10:02,430
If the stock looked so great at this
level, why wouldn't it for the value

875
01:10:02,430 --> 01:10:05,170
investor look great at this level?

876
01:10:06,629 --> 01:10:10,110
Obviously, this is not our trade because
we are technical traders.

877
01:10:10,430 --> 01:10:15,370
What we need to do is we need to figure
out how the emergence of the supply will

878
01:10:15,370 --> 01:10:16,169
be tested.

879
01:10:16,170 --> 01:10:22,170
And until we actually break the
downtrend and create some kind of change

880
01:10:22,170 --> 01:10:25,330
character, we can't really make any
assessment of this.

881
01:10:26,550 --> 01:10:31,670
All right, let's look at some questions.
Let's look at what you guys wrote.

882
01:10:31,830 --> 01:10:33,730
Okay, COO distributed its position.

883
01:10:34,520 --> 01:10:41,460
Yes, so CO, ITF, weak hands, everybody
capitulates right

884
01:10:41,460 --> 01:10:48,300
here. So this looks more like even a
general capitulation rather than

885
01:10:48,300 --> 01:10:50,120
just like CO or ITF.

886
01:10:50,340 --> 01:10:54,480
Everybody is capitulating at the end of
the time, at the end of the point.

887
01:10:57,060 --> 01:11:03,060
Jury is making a comment, end of the
quarter, yes, also one of the things in

888
01:11:03,060 --> 01:11:04,060
bad market.

889
01:11:04,810 --> 01:11:09,330
Yeah, so I think it's the market, it's
just that the stock, you have to think

890
01:11:09,330 --> 01:11:13,090
within the context of what's happening,
right? So right away, I'm giving you all

891
01:11:13,090 --> 01:11:16,670
of the data for the market on this
chart, even though the market is not

892
01:11:16,950 --> 01:11:20,910
I'm giving you the time you should
remember what has happened during this

893
01:11:20,910 --> 01:11:26,790
period, and then you can create the
whole story as to why this gap happens

894
01:11:26,790 --> 01:11:28,810
this, why it's such a big gap.

895
01:11:30,950 --> 01:11:33,530
Okay, from Noesh.

896
01:11:34,010 --> 01:11:39,470
I marked these charts with two upsloping
trading ranges as well, but my

897
01:11:39,470 --> 01:11:43,030
boundaries are slightly different. I
often get confused around which points

898
01:11:43,030 --> 01:11:45,670
connect for slope and trading range to
mark boundaries.

899
01:11:45,970 --> 01:11:49,770
Is it more visual range or precisely
connecting specific points?

900
01:11:51,070 --> 01:11:57,510
This is a good question. So we
definitely want to identify the

901
01:11:57,510 --> 01:12:02,590
resistance points in phase A, which will
be a buying climax.

902
01:12:03,470 --> 01:12:10,170
and phase C, which will be as a higher
high in the upsloping structure,

903
01:12:10,410 --> 01:12:12,950
right? We are only discussing the
upsloping structure.

904
01:12:13,610 --> 01:12:16,230
We always will have higher high in phase
C.

905
01:12:17,250 --> 01:12:22,430
Or maybe we'll have a lower high and
then, you know, a higher high in phase

906
01:12:22,470 --> 01:12:25,710
something like this. So we're always
looking for these three points.

907
01:12:26,950 --> 01:12:30,990
Points of resistance in phases A, B, and
C.

908
01:12:31,640 --> 01:12:36,340
And then we are trying to connect them.
And only after that, we're looking at

909
01:12:36,340 --> 01:12:43,000
the automatic reaction and any type of
sign of witnesses in phase B to

910
01:12:43,000 --> 01:12:44,920
extend the parallel line.

911
01:12:45,160 --> 01:12:46,520
So that's what I did here.

912
01:12:47,180 --> 01:12:53,620
You could potentially also identify, you
know, maybe this height as well.

913
01:12:53,800 --> 01:12:58,400
But as you could see, this is just
another parallel line to the one that

914
01:12:58,400 --> 01:13:05,090
created. out of the bind climax and up
thrust right here um so um this is just

915
01:13:05,090 --> 01:13:11,090
another level of resistance another
level of support and then the second one

916
01:13:11,090 --> 01:13:17,890
i'm taking here phase a and phase c
please know how phase b has

917
01:13:17,890 --> 01:13:24,050
this up thrust action above this
resistance why i did it like this again

918
01:13:24,050 --> 01:13:29,920
is extremely important low right here
And also, obviously, yes, there is some

919
01:13:29,920 --> 01:13:35,760
kind of visual attempt to fit

920
01:13:35,760 --> 01:13:41,480
the definition as well. And I think that
you have to understand to what

921
01:13:41,480 --> 01:13:45,320
reasonable extent you can do this. What
is that reasonable extent?

922
01:13:45,520 --> 01:13:51,740
Well, seeing the significance of this
height, connecting on the same level,

923
01:13:51,740 --> 01:13:53,860
then seeing the significance of this
low.

924
01:13:54,670 --> 01:13:59,730
oversold condition, and then look at how
there is a commitment and then attempt

925
01:13:59,730 --> 01:14:01,590
to rally to the same level.

926
01:14:01,810 --> 01:14:07,430
So quite a lot of concepts that fit
together in this upsloping range.

927
01:14:07,750 --> 01:14:13,710
And then obviously the upthrust action
is just an upthrust in phase B.

928
01:14:14,470 --> 01:14:15,470
All right.

929
01:14:15,950 --> 01:14:16,950
Good question.

930
01:14:17,750 --> 01:14:20,270
All right. Let's go even faster.

931
01:14:21,120 --> 01:14:26,480
So here, a couple of things that we need
to discuss. Obviously, institutional

932
01:14:26,480 --> 01:14:28,880
value zone, we just looked at this
range.

933
01:14:29,180 --> 01:14:32,560
We looked at how the buy -in came on the
daily chart right here.

934
01:14:32,780 --> 01:14:37,660
This is definitely a lot of value on a
short -term basis, a lot of liquidity.

935
01:14:38,100 --> 01:14:45,040
Again, coming out of this zone, now the
price is cheaper, and there is

936
01:14:45,040 --> 01:14:46,260
a lot of value for institutions.

937
01:14:46,800 --> 01:14:49,240
Please note that every time...

938
01:14:49,640 --> 01:14:55,040
It went below the value zone into the
oversold condition. The price recovered

939
01:14:55,040 --> 01:14:57,360
really fast, really fast.

940
01:14:57,600 --> 01:15:04,100
And only in phase C, this is where we
see that the demand is

941
01:15:04,100 --> 01:15:05,100
inactive.

942
01:15:06,900 --> 01:15:13,880
And until it starts to emerge again and
there is some

943
01:15:13,880 --> 01:15:17,360
kind of institutional accumulation on
the way up,

944
01:15:18,470 --> 01:15:23,930
and we see this from the volume
signature, only then the price will

945
01:15:23,930 --> 01:15:27,710
up because this demand emergence

946
01:15:27,710 --> 01:15:34,490
will produce buying, and

947
01:15:34,490 --> 01:15:40,550
buying obviously will produce the
momentum up, and that will push the

948
01:15:41,970 --> 01:15:48,440
And again, we are talking about the
concept of emergence of the volume

949
01:15:48,720 --> 01:15:54,860
specifically increase of the demand,
with the

950
01:15:54,860 --> 01:16:01,380
movement of price up. So we're kind of
seeing how the result to the upside

951
01:16:01,380 --> 01:16:04,000
is following the demand signature.

952
01:16:05,580 --> 01:16:07,420
So that's the first condition.

953
01:16:08,440 --> 01:16:13,940
So this, the absorption and this
movement of the price,

954
01:16:15,180 --> 01:16:19,320
obviously will be shown on the increase
of the momentum.

955
01:16:21,320 --> 01:16:27,400
The price will start moving and it will
start moving faster

956
01:16:27,400 --> 01:16:29,760
to the upside.

957
01:16:30,280 --> 01:16:36,460
That will show a relative
outperformance.

958
01:16:41,920 --> 01:16:43,620
So it's very interesting.

959
01:16:44,040 --> 01:16:50,380
to observe how institutional clients are
always talking about this thing, the

960
01:16:50,380 --> 01:16:55,180
third one. And in effect, I mean, we're
teaching you the same thing, guys,

961
01:16:55,260 --> 01:17:00,200
right? Because relative strength is
extremely important as a subject. It

962
01:17:00,200 --> 01:17:05,380
identifies, you know, the
outperformance, so it suggests

963
01:17:05,380 --> 01:17:06,380
behind it.

964
01:17:06,840 --> 01:17:12,100
But if you think about the origination
of the relative outperformance, it

965
01:17:12,100 --> 01:17:18,000
comes... once the momentum is increasing
and it comes after the emergence of the

966
01:17:18,000 --> 01:17:23,380
volume signature, that would suggest
that the demand absorbs the supply and

967
01:17:23,380 --> 01:17:25,940
capable of pushing the price up.

968
01:17:27,620 --> 01:17:34,420
Only when the effort and the results are
synced, that's when everything

969
01:17:34,420 --> 01:17:35,880
else is going to happen.

970
01:17:36,400 --> 01:17:40,160
So kind of interesting how it's being
all interpreted.

971
01:17:43,150 --> 01:17:44,150
What else?

972
01:17:44,530 --> 01:17:49,930
There were quite a few labelings like
this with phase C right here. I don't

973
01:17:49,930 --> 01:17:51,430
any problems with that either.

974
01:17:52,830 --> 01:17:58,090
Because if you're taking the position in
this area, you're still profitable for

975
01:17:58,090 --> 01:17:59,470
many years ahead.

976
01:18:00,670 --> 01:18:05,690
The only thing that I would mention is
that this area right here has its own

977
01:18:05,690 --> 01:18:10,230
texture. So look at the price, how it
behaves. Look at the...

978
01:18:11,580 --> 01:18:16,160
volume signature as well everything is
kind of like of the same type of the

979
01:18:16,160 --> 01:18:22,080
texture we have a stop in action and
then we have the volume on the way out

980
01:18:22,080 --> 01:18:28,920
sometimes this type of volume activities
define the ending of a

981
01:18:28,920 --> 01:18:34,060
downtrend and the beginning of the
uptrend or they define the boundaries of

982
01:18:34,060 --> 01:18:39,920
whole trading range you could also think
about this in much larger terms look at

983
01:18:39,920 --> 01:18:44,440
this volume signature right here defines
the beginning of the trading range look

984
01:18:44,440 --> 01:18:50,560
at this volume signature here defines
the beginning of an uptrend so the

985
01:18:50,560 --> 01:18:56,700
signature emerges sometimes at the
points where either where there is a

986
01:18:56,700 --> 01:19:02,740
aggressive absorption in the points of
the liquidity where everyone's panic is

987
01:19:02,740 --> 01:19:06,600
panicking or where there is now um

988
01:19:07,310 --> 01:19:12,210
a shift in sentiment from bearish to
bullish.

989
01:19:12,690 --> 01:19:18,050
And a lot of the institutions are trying
to get into this position as soon as

990
01:19:18,050 --> 01:19:23,530
possible and the urgent volume signature
or the urgent demand signature occurs.

991
01:19:25,850 --> 01:19:30,930
All right, here's the same trading range
only on the daily. This is that big

992
01:19:30,930 --> 01:19:35,510
phase C that I've labeled. So let's look
into this really quickly.

993
01:19:36,140 --> 01:19:41,240
We're seeing that there is a lot of
buying here as a stopping action. Then

994
01:19:41,240 --> 01:19:43,420
is a lot of buying here on the way down.

995
01:19:43,640 --> 01:19:49,600
So that kind of defines that value zone
where institutions are buyers. Look at

996
01:19:49,600 --> 01:19:56,340
every time it has a pop -up like this, a
spring type of action once

997
01:19:56,340 --> 01:19:58,320
we go into the oversold condition.

998
01:20:01,660 --> 01:20:05,240
Isn't it great to understand what spring
is all about?

999
01:20:05,920 --> 01:20:11,380
And then once you see that, you know
that every time, if this is a true

1000
01:20:11,380 --> 01:20:17,560
accumulation, then every time you have
an oversold condition, you have some

1001
01:20:17,560 --> 01:20:24,520
of attempt of the price to come back and
to return to the trading range,

1002
01:20:24,580 --> 01:20:26,060
return to the area of the resistance.

1003
01:20:26,720 --> 01:20:31,910
And hopefully on one of those rallies,
like this one right here, the price not

1004
01:20:31,910 --> 01:20:36,030
only will come back to the trading
range, but overshoot it, overshoot the

1005
01:20:36,030 --> 01:20:40,910
zone, commit to the upside, and then
react into this area of the support.

1006
01:20:41,430 --> 01:20:47,250
Now something even more significant has
happened here. There are two things that

1007
01:20:47,250 --> 01:20:53,530
we could see from this area where,
excuse me.

1008
01:21:22,160 --> 01:21:23,160
Sorry about that.

1009
01:21:23,740 --> 01:21:30,560
All right, I'm back. So there are two
ways of how institutions bind in

1010
01:21:30,560 --> 01:21:32,280
this particular area.

1011
01:21:33,120 --> 01:21:36,840
They are buying on the way down. We
could see this from the volume

1012
01:21:36,920 --> 01:21:43,340
This volume signature increase suggests
that, yes, supply is increasing and

1013
01:21:43,340 --> 01:21:45,900
supply is still dominant over the
demand.

1014
01:21:46,440 --> 01:21:50,980
But at the same time, we already see
that Demand is behind this volume

1015
01:21:50,980 --> 01:21:55,100
as well. And demand is not only present,
but it's increasing.

1016
01:21:56,240 --> 01:22:03,140
Therefore, it's not only the increasing
demand, but we

1017
01:22:03,140 --> 01:22:07,040
see from what has happened afterwards,
it's a stopping demand.

1018
01:22:10,580 --> 01:22:15,940
And therefore, we're concluding that
this could be an institutional demand.

1019
01:22:16,490 --> 01:22:19,230
And then we see a different type of
institutional demand.

1020
01:22:20,650 --> 01:22:27,630
It's the demand that produces this type
of move on the way up where demand

1021
01:22:27,630 --> 01:22:32,890
signature is extremely high, volume
signature is extremely high. That

1022
01:22:32,890 --> 01:22:39,310
an urgent institutional accumulation on
the way up. And think about the urgency.

1023
01:22:39,650 --> 01:22:41,990
What does it really even mean?

1024
01:22:43,030 --> 01:22:44,050
Urgent demand.

1025
01:22:45,320 --> 01:22:51,040
That probably means that institutions
are seeing so much value currently that

1026
01:22:51,040 --> 01:22:54,580
they want to get in into this position
and just stay in this position.

1027
01:22:55,700 --> 01:22:58,180
And they want to get in at the lowest
price.

1028
01:22:58,760 --> 01:23:04,220
So that's why, because a lot of them are
trying to get in as they see this value

1029
01:23:04,220 --> 01:23:08,960
proposition, valuation of the stock
somewhere higher in multiple years.

1030
01:23:10,880 --> 01:23:13,780
They're trying to get in at any price.
They don't really care.

1031
01:23:15,600 --> 01:23:17,720
Okay, so what else here?

1032
01:23:19,160 --> 01:23:23,420
One of the interesting things is just
the phase C definition.

1033
01:23:24,240 --> 01:23:31,100
So the thing about this is it could be
interpreted in

1034
01:23:31,100 --> 01:23:36,200
so many ways. I mean, I could see that
somebody would be saying that this is a

1035
01:23:36,200 --> 01:23:38,640
bind climax here because there is a
climactic run.

1036
01:23:38,880 --> 01:23:41,160
I wouldn't argue with that whatsoever.

1037
01:23:43,340 --> 01:23:45,540
But I also could see a climactic run
here.

1038
01:23:46,020 --> 01:23:50,480
And obviously, I'm looking at this
reaction right here and comparing it to

1039
01:23:50,480 --> 01:23:51,700
of the previous reactions.

1040
01:23:52,360 --> 01:23:56,420
And this looks like a change of
character. If this is a change of

1041
01:23:56,600 --> 01:23:59,640
then this is phase A, and we are in the
trading range.

1042
01:24:00,100 --> 01:24:05,560
So therefore, the next move up may be
just a definition of a strength that

1043
01:24:05,560 --> 01:24:08,420
suggests a reaccumulation rather than a
distribution.

1044
01:24:09,470 --> 01:24:13,230
But we still would be thinking that this
is an attempt to retest the previous

1045
01:24:13,230 --> 01:24:19,530
high as a secondary test of thrust
action just because we overcame,

1046
01:24:19,850 --> 01:24:20,930
then came back.

1047
01:24:21,230 --> 01:24:27,610
So then think about the number of tests,
right? So test number one, test number

1048
01:24:27,610 --> 01:24:33,790
two, test number three. And test number
three happens as a higher low.

1049
01:24:34,380 --> 01:24:37,940
Could phase C have this type of
characteristics?

1050
01:24:38,400 --> 01:24:45,140
Yes. What should happen after phase C?
Well, we should commit above the

1051
01:24:45,140 --> 01:24:50,760
resistance that was created in phases A
and B, and now everything should click

1052
01:24:50,760 --> 01:24:51,760
at this point.

1053
01:24:52,680 --> 01:24:57,820
And commit it in a specific way. We want
to see sign of strength

1054
01:24:57,820 --> 01:24:58,820
characteristics.

1055
01:24:59,480 --> 01:25:00,560
What are those?

1056
01:25:00,920 --> 01:25:03,600
Increasing volume signature, increasing
spread.

1057
01:25:04,350 --> 01:25:05,890
And we see both of those.

1058
01:25:06,150 --> 01:25:10,850
And relative to the previous rallies,
it's definitely much, much better.

1059
01:25:11,310 --> 01:25:15,290
Plus, on the major sign of strength, we
are committing above, and then we are

1060
01:25:15,290 --> 01:25:18,770
reacting exactly to the area of the
support.

1061
01:25:19,230 --> 01:25:24,610
So phase C might not be seen right away
as phase C.

1062
01:25:24,850 --> 01:25:27,990
The tendency is going to be to label
this as phase C.

1063
01:25:28,950 --> 01:25:31,930
And even that is going to be sufficient.

1064
01:25:33,350 --> 01:25:37,350
just because if you think that this is
phase c your point of interest are going

1065
01:25:37,350 --> 01:25:41,950
to be all around this area which is the
area of where we want to come in and

1066
01:25:41,950 --> 01:25:42,850
establish the position

1067
01:25:42,850 --> 01:25:49,830
all right uh

1068
01:25:49,830 --> 01:25:54,690
let's come back to questions um second
trading range late december marked as a

1069
01:25:54,690 --> 01:26:01,550
spring um can it be um right here i'm
assuming

1070
01:26:01,950 --> 01:26:06,670
Again, if you think that this is phase
C, then yes, the proper labeling would

1071
01:26:06,670 --> 01:26:07,409
a sprint.

1072
01:26:07,410 --> 01:26:13,210
Now, in this case, because I'm labeling
this as phase B, in phase B, we are

1073
01:26:13,210 --> 01:26:17,670
going to have sprint type actions, but
not sprints.

1074
01:26:19,330 --> 01:26:25,090
But this is just relative to this
formation, to the local formation, you

1075
01:26:25,090 --> 01:26:26,230
label it as a sprint.

1076
01:26:27,470 --> 01:26:33,090
relative to the whole trading range,
then this action in phase B is going to

1077
01:26:33,090 --> 01:26:39,750
interpreted as a secondary attempt to
retest the previous low as an

1078
01:26:39,750 --> 01:26:40,750
automatic reaction.

1079
01:26:41,630 --> 01:26:43,670
All right.

1080
01:26:44,250 --> 01:26:47,430
Let's kind of see what else is
interesting here.

1081
01:26:48,290 --> 01:26:55,090
Yes, on this chart, a

1082
01:26:55,090 --> 01:26:57,870
lot of you, Put phase C right here.

1083
01:26:58,510 --> 01:27:05,350
So this is a little bit difficult here
just because this is

1084
01:27:05,350 --> 01:27:06,390
an apex formation.

1085
01:27:06,970 --> 01:27:09,530
It's not your usual horizontal range.

1086
01:27:09,810 --> 01:27:11,750
But you have to apply concepts.

1087
01:27:11,990 --> 01:27:16,230
And that's why I ask you guys, please go
to the schematic.

1088
01:27:16,870 --> 01:27:21,610
Please go to the explanation of all of
the Wyckoff events with the

1089
01:27:21,610 --> 01:27:24,290
characteristics. And think conceptually.

1090
01:27:26,280 --> 01:27:27,360
How would we do that?

1091
01:27:28,220 --> 01:27:33,800
And move to the upside, it should end
somehow and somewhere, right?

1092
01:27:41,280 --> 01:27:43,340
Where is that stop in action?

1093
01:27:43,660 --> 01:27:44,900
Well, probably here.

1094
01:27:45,400 --> 01:27:50,540
Why? Well, because we experienced the
biggest reaction after that.

1095
01:27:51,040 --> 01:27:54,240
So most likely, this is a change of
character.

1096
01:27:54,760 --> 01:27:58,580
If this is a change of character, this
is phase A. If this is phase A, then

1097
01:27:58,580 --> 01:27:59,680
is an automatic reaction.

1098
01:28:00,420 --> 01:28:04,420
Then the next attempt to go up is going
to be a secondary test.

1099
01:28:05,280 --> 01:28:10,420
It commits above by one close.

1100
01:28:10,740 --> 01:28:13,780
So an element of an upthrust.

1101
01:28:14,080 --> 01:28:20,700
But because of the character, of the
change of character, right? So it's not

1102
01:28:20,700 --> 01:28:22,520
that robust to the downside.

1103
01:28:23,370 --> 01:28:27,810
It does not retrace more than, you know,
it doesn't go to one half of the

1104
01:28:27,810 --> 01:28:28,810
previous move.

1105
01:28:28,970 --> 01:28:35,290
It looks very bullish. So therefore,
upthrust action, because we're thinking

1106
01:28:35,290 --> 01:28:38,110
that this is still a reaccumulation.

1107
01:28:39,550 --> 01:28:45,390
Plus, it also happens at the level of
the previous more significant climactic

1108
01:28:45,390 --> 01:28:50,350
action. So we're thinking this could be
a major sign of strength and then a

1109
01:28:50,350 --> 01:28:51,750
major backing up action.

1110
01:28:52,970 --> 01:28:59,650
So as we've defined phase A with all of
those elements, then we want maybe to

1111
01:28:59,650 --> 01:29:05,370
think about either the number of tests,
which is one, two,

1112
01:29:05,630 --> 01:29:10,110
and then three. And then think about
other concepts.

1113
01:29:10,310 --> 01:29:16,970
In apex formation, we will never see a
very prolonged backing up

1114
01:29:16,970 --> 01:29:20,650
action. We will never see also a very...

1115
01:29:21,000 --> 01:29:22,780
long major sign of strength.

1116
01:29:23,020 --> 01:29:25,420
It's going to look exactly like this.

1117
01:29:25,680 --> 01:29:32,460
It's just a slight commitment to the
upside, quick retest, and then off we go

1118
01:29:32,460 --> 01:29:37,820
the races, just because of the apex
formation and the characteristic of that

1119
01:29:37,820 --> 01:29:38,820
apex formation.

1120
01:29:44,380 --> 01:29:49,560
Usually in the apex formation, a lot of
the volatility is going to be in phase A

1121
01:29:49,560 --> 01:29:50,840
or early phase B.

1122
01:29:51,060 --> 01:29:56,440
This is where the institutional rotation
will happen.

1123
01:29:56,880 --> 01:30:02,260
With this institutional rotation, we are
going to see the exchange of shares

1124
01:30:02,260 --> 01:30:06,400
between strong institutional hands and
weak institutional hands.

1125
01:30:06,800 --> 01:30:11,500
And then after that, into the apex
formation, the volume signature is going

1126
01:30:11,500 --> 01:30:12,840
diminish significantly.

1127
01:30:13,480 --> 01:30:15,600
this is where SEO is inactive.

1128
01:30:17,800 --> 01:30:23,840
And this is where trend followers are
inactive as well.

1129
01:30:24,760 --> 01:30:30,740
And this is where also weak hands are
somewhat inactive too. So we have that

1130
01:30:30,740 --> 01:30:32,280
diminishing volume signature.

1131
01:30:32,580 --> 01:30:38,900
And it's only on the breakout, this is
where some of the institutions are going

1132
01:30:38,900 --> 01:30:41,600
to see again some value, probably on
some event.

1133
01:30:42,270 --> 01:30:47,450
and they're coming back in and that
creates that momentum that push that

1134
01:30:47,450 --> 01:30:54,210
the price out of the apex formation in
here uh let's just

1135
01:30:54,210 --> 01:31:00,510
quickly look at the value zone look at
this trading range so there's some

1136
01:31:00,510 --> 01:31:06,650
uh institutional pickup on the way down
there's definitely a lot of buying here

1137
01:31:06,650 --> 01:31:13,410
and then on the way up So this defines
this whole value zone. And then as we go

1138
01:31:13,410 --> 01:31:16,550
down, this looks more like a shakeout.

1139
01:31:17,350 --> 01:31:21,370
It should not be labeled as a sprain.
It's labeled as a sprain just because of

1140
01:31:21,370 --> 01:31:25,450
the downslope. But if we're looking at
the horizontal range, like this one

1141
01:31:25,450 --> 01:31:29,910
here, this is definitely the character
of the shakeout where we have multiple

1142
01:31:29,910 --> 01:31:31,630
closes committing to the downside.

1143
01:31:32,110 --> 01:31:34,230
It's a significant move to the downside.

1144
01:31:35,230 --> 01:31:40,010
What else we don't see here is that you
know, the volume signature has not

1145
01:31:40,010 --> 01:31:45,050
increased that significantly. So that
could make it an argument for the

1146
01:31:46,270 --> 01:31:53,110
But then an oversold condition where it
quickly comes

1147
01:31:53,110 --> 01:31:56,510
back to the value zone and then
overcomes it.

1148
01:31:56,790 --> 01:32:02,910
And those value zones, they change,
right? So from one level, they go to the

1149
01:32:02,910 --> 01:32:05,770
next level where we see a lot of
institutional volume.

1150
01:32:08,090 --> 01:32:12,930
And, again, in the range where we go
into overbought condition, what's going

1151
01:32:12,930 --> 01:32:14,610
happen? Professionals are going to sell.

1152
01:32:15,170 --> 01:32:19,070
Where we go into the overbought
condition, there's going to be an

1153
01:32:19,070 --> 01:32:20,070
sell.

1154
01:32:21,130 --> 01:32:26,170
Where we are, well, we don't have an
oversold condition here, but here was an

1155
01:32:26,170 --> 01:32:27,170
oversold.

1156
01:32:27,530 --> 01:32:28,710
So, a quick recovery.

1157
01:32:29,910 --> 01:32:31,510
Okay, quick questions.

1158
01:32:35,470 --> 01:32:36,650
Second trading range,

1159
01:32:38,170 --> 01:32:39,290
late December.

1160
01:32:39,810 --> 01:32:44,790
Oh, I think it was a different, it was a
previous slide. Okay.

1161
01:32:45,710 --> 01:32:46,910
Second trading range.

1162
01:32:47,330 --> 01:32:50,810
Secondary test has been up thrust
action.

1163
01:32:51,330 --> 01:32:55,150
It has price action and volume signature
as buying climax.

1164
01:32:56,390 --> 01:32:58,090
I understand you're just curious.

1165
01:32:58,450 --> 01:33:00,710
Yeah, it has those characteristics.

1166
01:33:02,780 --> 01:33:09,140
But this type of characteristics are not
just necessarily going to be present at

1167
01:33:09,140 --> 01:33:10,140
the buy -in climax.

1168
01:33:11,000 --> 01:33:15,700
You can have different other spots that
would have expending spread signature,

1169
01:33:16,040 --> 01:33:19,920
expending volume signature.

1170
01:33:21,740 --> 01:33:28,480
Excuse me. So my logic here was just
based on interpretation of the change of

1171
01:33:28,480 --> 01:33:31,940
character and the stop in action of the
buy -in climax.

1172
01:33:32,669 --> 01:33:38,790
But if you would put it here, buying
climax, as I mentioned before, you could

1173
01:33:38,790 --> 01:33:44,570
label it in a different way. You could
probably think that this is phase A

1174
01:33:44,570 --> 01:33:50,370
here, and then this is B, and then this
is C again, and that would be okay.

1175
01:33:50,850 --> 01:33:55,410
Again, the labeling does not really
matter if you're making a profitable

1176
01:33:56,130 --> 01:34:00,090
That's the whole purpose of everything
that we do here.

1177
01:34:02,220 --> 01:34:05,740
All right, so what do we have on time? I
was kind of thinking that we're going

1178
01:34:05,740 --> 01:34:09,940
to go into 6 o 'clock today, so we still
have some time. Okay.

1179
01:34:12,080 --> 01:34:15,040
All right, so this one was somewhat
easy.

1180
01:34:16,120 --> 01:34:19,780
A lot of you guys just kind of like
nailed it everywhere.

1181
01:34:20,360 --> 01:34:26,260
I like that a lot of you put here phase
C right here. Again, we are talking

1182
01:34:26,260 --> 01:34:29,280
about an attempt to upthrust.

1183
01:34:29,760 --> 01:34:31,020
And just because...

1184
01:34:31,520 --> 01:34:34,140
It creates a lower high.

1185
01:34:34,440 --> 01:34:41,360
That's why we label this as a last point
of supply and couple of tests into

1186
01:34:41,360 --> 01:34:45,680
that last point of supply.

1187
01:34:46,820 --> 01:34:53,120
Major sign of weakness. Look how in the
downsloping distributional range, we are

1188
01:34:53,120 --> 01:34:57,680
seeing a commitment to the downside and
then attempt to...

1189
01:34:58,650 --> 01:35:02,990
come back into the trading range, and it
comes exactly to the point of the

1190
01:35:02,990 --> 01:35:07,190
resistance that acted before as the
sloping down support.

1191
01:35:07,530 --> 01:35:11,110
So all of the concepts are there.
They're all correct.

1192
01:35:18,550 --> 01:35:24,110
Okay, well, it is definitely a very
interesting Wyckoff story here, but I

1193
01:35:24,110 --> 01:35:25,790
that maybe we'll skip this for today.

1194
01:35:32,430 --> 01:35:39,130
Look at this value zone where we are
seeing that a lot of institutional

1195
01:35:39,130 --> 01:35:40,790
buying has happened in this area.

1196
01:35:41,290 --> 01:35:42,730
So where is the price?

1197
01:35:42,990 --> 01:35:47,810
It's right here in this zone. So that
defines that institutional value zone

1198
01:35:47,810 --> 01:35:54,610
us. Anything below this is oversold and
will be quickly bought in

1199
01:35:54,610 --> 01:35:56,170
by institutions.

1200
01:35:56,790 --> 01:35:57,790
Look at this.

1201
01:35:58,130 --> 01:36:01,610
Look into this. And we kind of could see
how...

1202
01:36:01,960 --> 01:36:07,060
These three points are creating a sprint
type of action

1203
01:36:07,060 --> 01:36:14,040
just slightly below that institutional
value zone. So that's

1204
01:36:14,040 --> 01:36:16,920
kind of like a true definition of a
sprint to me.

1205
01:36:17,700 --> 01:36:24,460
It's an oversold condition below an
institutional value zone

1206
01:36:24,460 --> 01:36:27,400
that produces a quick...

1207
01:36:28,650 --> 01:36:35,030
absorption of the available supply below
this zone, and that brings the price

1208
01:36:35,030 --> 01:36:39,590
back into that zone very fast.

1209
01:36:39,910 --> 01:36:42,130
And that's exactly what we're seeing
here.

1210
01:36:43,450 --> 01:36:49,730
Another interesting thought here is that
look at the volume signature.

1211
01:36:50,070 --> 01:36:55,030
Once institutions are in this position,
they just basically don't buy.

1212
01:36:55,790 --> 01:37:02,070
They consumed, absorbed all of the
supply available, and they're just

1213
01:37:02,950 --> 01:37:09,470
So as the price retests the lows, every
time in the

1214
01:37:09,470 --> 01:37:15,290
oversold condition, there is some kind
of small pickup of the supply, and that

1215
01:37:15,290 --> 01:37:21,450
absorbs and kind of concludes the
absorption process. That absorbs

1216
01:37:21,450 --> 01:37:22,450
left.

1217
01:37:23,850 --> 01:37:29,170
to what they already have bought, and
they have bought so much, that at some

1218
01:37:29,170 --> 01:37:36,070
point, supply is no longer available,
and even an inactivity by

1219
01:37:36,070 --> 01:37:42,690
the CEO produces a move up, just because
supply is

1220
01:37:42,690 --> 01:37:43,930
so low.

1221
01:37:46,330 --> 01:37:52,230
So this is a very important point. We
will come back to that on other slides.

1222
01:37:53,610 --> 01:37:54,670
All right, here.

1223
01:37:56,110 --> 01:38:03,050
Okay, guys, I think that what you'll do
here is let's just do

1224
01:38:03,050 --> 01:38:05,470
this on your own. So let's do a self
-review.

1225
01:38:06,050 --> 01:38:07,270
So this slide.

1226
01:38:13,270 --> 01:38:15,250
Okay, so this one is interesting.

1227
01:38:17,250 --> 01:38:20,270
And a really good question from Nilesh.

1228
01:38:21,769 --> 01:38:25,610
Let's go first through the
distributional weak hands value zone.

1229
01:38:25,850 --> 01:38:31,790
So again, we know into the buying
climax, the first point of excitement is

1230
01:38:31,790 --> 01:38:35,750
to be by weak hands. It's going to be on
the climactic run, which is this.

1231
01:38:37,470 --> 01:38:40,410
And we see that from the demand
signature.

1232
01:38:42,830 --> 01:38:46,430
And we define the zone throughout this
whole range.

1233
01:38:47,390 --> 01:38:48,790
Now the question...

1234
01:38:49,280 --> 01:38:55,580
that was asked by Nilesh is, at what
point do we need to consider this as an

1235
01:38:55,580 --> 01:38:57,120
upward slope in trading range?

1236
01:38:59,080 --> 01:39:04,300
Because originally, this is what we
would be thinking. And originally,

1237
01:39:04,300 --> 01:39:08,400
how I labeled this range when we had
this change of character that was well

1238
01:39:08,400 --> 01:39:14,200
-defined with the increase in volume
signature and the biggest reaction in

1239
01:39:14,200 --> 01:39:16,220
upswing that we have seen.

1240
01:39:17,000 --> 01:39:23,370
That suggested... a non -consolidating
environment a trading range and uh the

1241
01:39:23,370 --> 01:39:27,930
question that now is asking is very
important at which point would we be

1242
01:39:27,930 --> 01:39:34,910
thinking about up sloping structure
rather than more of the horizontal

1243
01:39:34,910 --> 01:39:41,190
and i think that we would be thinking
here and i think this was another

1244
01:39:41,190 --> 01:39:47,910
from somebody or maybe in this question
we could see this Would we be

1245
01:39:47,910 --> 01:39:48,910
biased here?

1246
01:39:50,290 --> 01:39:57,190
I think that without thinking too deeply
about this, and by deep thinking, I

1247
01:39:57,190 --> 01:39:59,990
would be thinking about what were our
original targets.

1248
01:40:00,290 --> 01:40:04,850
And actually, their original targets
suggested exactly the stop in action

1249
01:40:04,850 --> 01:40:06,090
somewhere in this area.

1250
01:40:06,510 --> 01:40:11,910
And those type of PNF targets

1251
01:40:11,910 --> 01:40:15,910
were off 2000,

1252
01:40:16,890 --> 01:40:23,810
8 2009 trading range so that's a big
trading range right there um

1253
01:40:23,810 --> 01:40:30,790
uh so if we are in the vicinity of this
targets we should be extremely careful

1254
01:40:30,790 --> 01:40:37,530
and we should be uh stopping listening
watching as to what

1255
01:40:37,530 --> 01:40:42,590
the price and the volume is showing us
and telling us having said this

1256
01:40:44,240 --> 01:40:47,940
It seems that this area has the texture
of the reaccumulation.

1257
01:40:48,300 --> 01:40:54,180
We see multiple tests on the diminution
volume signature, the tests that are

1258
01:40:54,180 --> 01:40:58,240
higher lows, and we have higher highs,
local higher highs.

1259
01:40:58,480 --> 01:41:01,580
So that looks constructive and bullish.

1260
01:41:02,280 --> 01:41:07,400
This reaction right here that has some
volume signature does not produce a big

1261
01:41:07,400 --> 01:41:08,720
result to the downside.

1262
01:41:09,240 --> 01:41:12,420
It's diminution as a result, which is
bullish.

1263
01:41:13,480 --> 01:41:17,800
short -term bullish on such a big effort
signature.

1264
01:41:20,920 --> 01:41:26,720
Also, it stops exactly at the first
point of the first automatic reaction.

1265
01:41:27,660 --> 01:41:32,400
So that's also a good symmetry, bullish
symmetry for us to see.

1266
01:41:40,080 --> 01:41:42,460
So I wouldn't mind actually

1267
01:41:43,240 --> 01:41:50,000
having a position or thinking about
establishing a position at this spot.

1268
01:41:57,360 --> 01:42:01,880
So somewhere here on the breakout,
that's another possibility.

1269
01:42:02,940 --> 01:42:09,060
And then once you are in this trading
range, you're probably going to close

1270
01:42:09,060 --> 01:42:11,620
this position here. This will be your
exit.

1271
01:42:12,810 --> 01:42:18,850
So you guys kind of could see that my
strategy is not necessarily to be

1272
01:42:18,850 --> 01:42:25,470
every time. My strategy is to be sure
that I'm going to

1273
01:42:25,470 --> 01:42:28,250
see the opportunity and I'm going to use
this opportunity.

1274
01:42:29,550 --> 01:42:35,390
Obviously, on a much deeper level of
thinking, I mentioned the target zone

1275
01:42:35,390 --> 01:42:39,990
here, and I mentioned this really
briefly. But this was a very consistent

1276
01:42:39,990 --> 01:42:41,110
selling right here.

1277
01:42:42,380 --> 01:42:44,120
have produced some kind of hesitation.

1278
01:42:44,560 --> 01:42:50,480
But the actual recognition of this
pattern came right here. And the reason

1279
01:42:50,480 --> 01:42:57,180
it came here, you know, on this reaction
or on this failure is because we're

1280
01:42:57,180 --> 01:43:04,060
still talking about a leadership stock
that has a structure

1281
01:43:04,060 --> 01:43:07,500
of the distributional structure of
higher highs, higher lows.

1282
01:43:08,060 --> 01:43:14,820
And those are going to have a lot of
reaccumulation characteristics in phase

1283
01:43:15,000 --> 01:43:21,900
So it's extremely hard to figure this
out until it actually shows

1284
01:43:21,900 --> 01:43:26,260
itself on a change of character out of
the trading range.

1285
01:43:26,660 --> 01:43:32,800
But if you train your eye to recognize
this failure, so there is no

1286
01:43:32,800 --> 01:43:34,800
up, there is a failure.

1287
01:43:37,420 --> 01:43:40,540
then somewhere here in this zone, you
could change your bias.

1288
01:43:44,600 --> 01:43:50,300
And that's what I do with a lot of
stocks. And I've shown you guys with

1289
01:43:50,300 --> 01:43:53,940
just recently where Navadir has been
such a leadership stock.

1290
01:43:55,200 --> 01:44:01,680
I've tried to short Apple in this
campaign to the downside and kind of

1291
01:44:01,680 --> 01:44:04,480
picked up just, you know, what's correct
on the bias was.

1292
01:44:05,550 --> 01:44:07,610
you know, premature to exit.

1293
01:44:08,010 --> 01:44:12,290
But the concepts are the same.
Leadership stocks are going to be

1294
01:44:12,290 --> 01:44:13,290
a different way.

1295
01:44:13,330 --> 01:44:19,650
And you have to sometimes change your
bias on the change of character after a

1296
01:44:19,650 --> 01:44:24,110
new high. And sometimes it's extremely
difficult to do just because mentally

1297
01:44:24,110 --> 01:44:25,170
it's hard to do.

1298
01:44:25,570 --> 01:44:32,150
Now look what happens with the weak
hands value zone as the price falls.

1299
01:44:32,830 --> 01:44:37,850
and comes into the oversold condition,
first of all, the recovery is very

1300
01:44:38,130 --> 01:44:42,950
That suggests that still there is some
kind of value to some of the weak hands

1301
01:44:42,950 --> 01:44:44,310
at this point of time.

1302
01:44:44,690 --> 01:44:50,310
And then look at the second rally. It
comes exactly to the point of where weak

1303
01:44:50,310 --> 01:44:51,490
hands were starting buying.

1304
01:44:52,790 --> 01:44:56,970
It excites buyers because they are
thinking that this is an oversold

1305
01:44:58,310 --> 01:45:02,070
And then institutions are just selling
into that excitement.

1306
01:45:02,590 --> 01:45:08,990
Both of the rallies have that excitement
characteristics behind it in the way

1307
01:45:08,990 --> 01:45:09,990
how the price moved.

1308
01:45:10,450 --> 01:45:15,430
And then on the way down, we're seeing
that

1309
01:45:15,430 --> 01:45:22,330
late institutional capitulation, it
coincides with the institutional

1310
01:45:22,330 --> 01:45:26,290
value buying on short -term liquidity
and long -term value.

1311
01:45:26,570 --> 01:45:29,570
So in other words, why is it so
confusing?

1312
01:45:30,060 --> 01:45:32,760
Why are we using institutional in both
cases?

1313
01:45:33,180 --> 01:45:37,700
Well, the drop to the downside kind of
suggests in the volume signature that

1314
01:45:37,700 --> 01:45:38,940
institutions are present.

1315
01:45:39,160 --> 01:45:45,040
They are sellers at this point of time.
Or rather, I should say, specific

1316
01:45:45,040 --> 01:45:46,640
institutions are sellers.

1317
01:45:46,860 --> 01:45:52,960
And then other institutions at the same
time are buyers because they are seeing

1318
01:45:52,960 --> 01:45:58,840
some value. And they are saying that
even so early on in the process of

1319
01:46:01,639 --> 01:46:06,440
establishing the new low, establishing
the new accumulation range, we are

1320
01:46:06,440 --> 01:46:10,740
willing to come in and to buy because
there is so many stock shares that are

1321
01:46:10,740 --> 01:46:12,780
available at this point of time.

1322
01:46:13,140 --> 01:46:17,840
So they will do exactly that. And this
is where we would put that first initial

1323
01:46:17,840 --> 01:46:18,840
value zone.

1324
01:46:19,300 --> 01:46:25,300
And then every time we go below that
oversold condition, we quickly recover.

1325
01:46:26,120 --> 01:46:29,320
Go below that oversold condition,
quickly recover.

1326
01:46:29,680 --> 01:46:32,020
Go below, quickly recover.

1327
01:46:32,400 --> 01:46:38,060
And on the recovery that takes us
throughout the whole trading range,

1328
01:46:38,060 --> 01:46:44,980
when we are identifying a major sign of
strength, changing of the environment

1329
01:46:44,980 --> 01:46:51,340
from a trading range to the emerging
uptrend thing. And we only need the

1330
01:46:51,340 --> 01:46:55,440
confirmation by the backing up action.
Now look how the price...

1331
01:46:55,930 --> 01:46:58,050
comes back into the value zone.

1332
01:46:59,030 --> 01:47:04,590
And again, that creates what? An
oversold condition, but now an oversold

1333
01:47:04,590 --> 01:47:07,510
relative to the price that is above the
value zone.

1334
01:47:07,950 --> 01:47:14,650
And again, it acts as a screen type of
price

1335
01:47:14,650 --> 01:47:19,570
action where the price goes below the
support and then quickly recovers. Why?

1336
01:47:19,810 --> 01:47:22,830
Well, because somebody sees value and
picks it up.

1337
01:47:23,980 --> 01:47:29,320
somebody was seeing value here and then
seeing more value even lower.

1338
01:47:29,700 --> 01:47:35,860
And that should kind of trigger your
thinking about,

1339
01:47:36,080 --> 01:47:41,080
actually not there, sorry, here and
here.

1340
01:47:42,740 --> 01:47:47,300
This type of the decline into the value
zone and the way how it recovers so

1341
01:47:47,300 --> 01:47:51,180
quickly, you should be thinking that the
volume increase

1342
01:47:52,410 --> 01:47:57,150
suggested that there is a lot of demand
that's coming in. First demand was

1343
01:47:57,150 --> 01:48:01,050
absorbing the supply, and then the
second demand was absorbing whatever was

1344
01:48:01,050 --> 01:48:06,430
left. And because supply has diminished,
the absorption was faster, and the

1345
01:48:06,430 --> 01:48:08,370
price recovered pretty fast.

1346
01:48:09,050 --> 01:48:11,130
So think about that type of logic.

1347
01:48:11,590 --> 01:48:16,310
If you are thinking this way, then you
might be even coming in into this

1348
01:48:16,310 --> 01:48:17,310
position here.

1349
01:48:17,530 --> 01:48:21,810
Because you might be thinking that if
this is an oversold in the backing up

1350
01:48:21,810 --> 01:48:26,710
action, this could be the lowest low in
that backing up action, which it was.

1351
01:48:27,270 --> 01:48:31,430
So, and it could create some kind of
like maybe apex formation and this low

1352
01:48:31,430 --> 01:48:32,430
going to be the lowest low.

1353
01:48:32,730 --> 01:48:34,910
So, we want to start thinking this way.

1354
01:48:37,570 --> 01:48:38,570
Okay.

1355
01:48:39,470 --> 01:48:42,990
All right. So, this one is going to be
for your home review.

1356
01:48:44,290 --> 01:48:45,290
Let's do that.

1357
01:48:51,440 --> 01:48:56,680
All right. So now let's talk about the
volume and spread analysis. And we are

1358
01:48:56,680 --> 01:48:57,740
to 5. Okay, great.

1359
01:48:59,320 --> 01:49:05,260
I want you right away to concentrate on
one idea and one idea only.

1360
01:49:05,580 --> 01:49:11,380
When you are looking at the volume and
spread analysis, and you probably have

1361
01:49:11,380 --> 01:49:15,500
seen it from different sources,
different software sources.

1362
01:49:16,360 --> 01:49:21,820
So the biggest mistake that I see
students do with this material is that

1363
01:49:21,820 --> 01:49:28,820
see the signal. They could interpret the
signal, but they do not

1364
01:49:28,820 --> 01:49:34,040
look into the context of where the
signal occurs.

1365
01:49:35,720 --> 01:49:41,000
In other words, you need to understand
the environment that we are in and then

1366
01:49:41,000 --> 01:49:44,180
look into the VSA signal and interpret.

1367
01:49:44,860 --> 01:49:51,280
this signal relative to that environment
so let's look at that and we're going

1368
01:49:51,280 --> 01:49:58,080
to start with basics and this comes
actually from one of the ink students

1369
01:49:58,080 --> 01:50:05,040
blythe he is an md and jerry has taken
hanks

1370
01:50:05,040 --> 01:50:11,740
classes uh many decades ago and he has
created this kind of like uh you know a

1371
01:50:11,740 --> 01:50:12,740
small

1372
01:50:13,220 --> 01:50:18,920
spreadsheet references to the volume and
spread and the way how they behave.

1373
01:50:19,940 --> 01:50:26,900
So I'm using this first slide just to
give the credit to Jerry and also to

1374
01:50:26,900 --> 01:50:30,960
go through some general considerations
about the spread and the volume. So

1375
01:50:30,960 --> 01:50:31,960
look into this.

1376
01:50:32,020 --> 01:50:37,380
So under the spread, the increase in
spread would suggest that there is a

1377
01:50:37,380 --> 01:50:39,020
resistance to the price progress.

1378
01:50:39,969 --> 01:50:45,290
Decreasing spread would say the
opposite, some resistance to price

1379
01:50:45,290 --> 01:50:48,910
then the average is going to just
express the normal trend of price

1380
01:50:49,830 --> 01:50:52,070
Volume is going to be much more
difficult.

1381
01:50:52,970 --> 01:50:54,150
General considerations.

1382
01:50:54,770 --> 01:50:59,230
Usually volume is going to be associated
with the force behind the power.

1383
01:50:59,490 --> 01:51:04,550
So we usually would think about the
effort behind it.

1384
01:51:07,790 --> 01:51:13,510
Volume usually expresses the quality of
supply and demand, and we'll talk a lot

1385
01:51:13,510 --> 01:51:18,870
about this because we will be creating
those volume equations with the supply

1386
01:51:18,870 --> 01:51:19,870
and demand.

1387
01:51:22,170 --> 01:51:29,170
Increasing volume in general is going to
be usually suggesting

1388
01:51:29,170 --> 01:51:31,210
supply.

1389
01:51:32,670 --> 01:51:34,910
That's number one in a lot of cases.

1390
01:51:35,950 --> 01:51:42,670
but then also it will, in some cases,
will

1391
01:51:42,670 --> 01:51:44,330
show the emergence of the demand.

1392
01:51:45,870 --> 01:51:52,850
And we will just need to be aware in
which environments, in which contexts

1393
01:51:52,850 --> 01:51:57,550
we are interpreting that signal between
the volume and the price.

1394
01:51:58,950 --> 01:52:04,890
A very heavy volume usually is all about
the supply, but sometimes...

1395
01:52:05,580 --> 01:52:10,640
there's going to be an urgency to
accumulate, and that's going to be an

1396
01:52:10,640 --> 01:52:15,600
absorption on the way up on the major
sign of strength.

1397
01:52:17,140 --> 01:52:18,540
And we've seen that.

1398
01:52:19,140 --> 01:52:24,820
A massive volume signature usually will
indicate the climactic action.

1399
01:52:25,900 --> 01:52:30,740
Decreasing volume signature would
always, we'd be thinking about lessening

1400
01:52:30,740 --> 01:52:31,740
the force.

1401
01:52:32,180 --> 01:52:38,540
And then a very light supply signature
is going to indicate,

1402
01:52:38,760 --> 01:52:43,980
and I think I should take this down.
This is actually not necessarily

1403
01:52:44,760 --> 01:52:49,360
Okay, so let's just keep it like this.
Increasing, heavy, massive, and

1404
01:52:49,360 --> 01:52:53,840
decreasing. So those are general
considerations about the price and the

1405
01:52:54,160 --> 01:52:57,980
Now let's look at specific scenarios.

1406
01:52:59,340 --> 01:53:01,940
And I've created this slide for you
guys.

1407
01:53:02,540 --> 01:53:04,500
so that you would print it out.

1408
01:53:04,960 --> 01:53:10,620
And this is when I say print this out,
put this in your library, I mean study

1409
01:53:10,620 --> 01:53:17,420
it, have it in front of you as a
reference so that

1410
01:53:17,420 --> 01:53:19,020
we would be on the same page.

1411
01:53:19,540 --> 01:53:25,080
So one of the things here about volume
and spread analysis

1412
01:53:25,080 --> 01:53:29,560
that I keep repeating is the context.

1413
01:53:30,240 --> 01:53:31,580
The context...

1414
01:53:31,870 --> 01:53:35,970
is going to be the definition of the
environment that we're currently in

1415
01:53:35,970 --> 01:53:42,910
so the context uptrend and we have
different scenarios where let's say

1416
01:53:42,910 --> 01:53:49,730
increasing and then at the same time we
see that the volume signature is

1417
01:53:49,730 --> 01:53:56,430
increasing on the same bar so both both
uh result is

1418
01:53:56,430 --> 01:54:02,020
increasing and effort is increasing how
would they how would it look on the

1419
01:54:02,020 --> 01:54:09,020
volume equation right so volume is
increasing demand is increasing probably

1420
01:54:09,020 --> 01:54:15,560
than supply and we would be thinking
that with the expansion of the price

1421
01:54:15,560 --> 01:54:21,780
on the healthy increase of the volume
signature supply might be actually going

1422
01:54:21,780 --> 01:54:28,220
uh lower it's still present but it's
diminishing and demand is not only

1423
01:54:28,220 --> 01:54:29,520
but it's increasing

1424
01:54:30,380 --> 01:54:33,620
So effort is increasing and result is
increasing.

1425
01:54:33,940 --> 01:54:40,120
It's a bullish activity and we should
expect a continuation of the uptrend.

1426
01:54:41,140 --> 01:54:42,420
Second scenario.

1427
01:54:42,920 --> 01:54:49,820
This is where a spread is decreasing and
it still happens on

1428
01:54:49,820 --> 01:54:51,320
the increased volume signature.

1429
01:54:51,880 --> 01:54:53,640
So what does it mean?

1430
01:54:54,060 --> 01:54:58,100
We have a decreasing spread, which means
a decreasing result.

1431
01:54:59,150 --> 01:55:04,550
And we have an increase in volume, which
shows us an increase in effort to push

1432
01:55:04,550 --> 01:55:05,550
the price up.

1433
01:55:05,630 --> 01:55:12,210
So in other words, there is an increased
effort to push the price up, and yet it

1434
01:55:12,210 --> 01:55:13,210
can't do so.

1435
01:55:15,390 --> 01:55:19,470
Why would that happen? Why would there
be some kind of stopping of this

1436
01:55:19,470 --> 01:55:25,150
progress? Well, it only can happen with
the emergence of the supply.

1437
01:55:25,570 --> 01:55:27,430
So we know that supply...

1438
01:55:28,080 --> 01:55:33,860
is increasing and demand is still
winning because this is an up bar the

1439
01:55:33,860 --> 01:55:39,360
this bar is higher than the previous bar
close so demand is still dominant over

1440
01:55:39,360 --> 01:55:46,240
supply but because supply is increasing
it suggests that supply wants to

1441
01:55:46,240 --> 01:55:53,060
stop the uptrend from going further up
so therefore short term we will

1442
01:55:53,060 --> 01:55:55,400
this as a potential bearish implication

1443
01:55:56,240 --> 01:56:01,540
And short term, we might be expecting
some kind of reaction out of this area.

1444
01:56:03,620 --> 01:56:08,440
Third scenario in the advancing markets.
Spread is decreasing.

1445
01:56:09,600 --> 01:56:14,540
And with the decreasing spread, we have
a decreasing volume signature.

1446
01:56:15,060 --> 01:56:20,260
So this is an opposite of the volume
signature that we had in scenario number

1447
01:56:20,260 --> 01:56:21,260
two.

1448
01:56:22,000 --> 01:56:23,800
So how would we interpret this?

1449
01:56:24,220 --> 01:56:25,240
Decreasing spread.

1450
01:56:25,930 --> 01:56:28,290
means decreasing result to the upside.

1451
01:56:28,570 --> 01:56:31,510
And that happens on the decreasing
effort.

1452
01:56:32,530 --> 01:56:37,430
And here we might be thinking that
demand is actually decreasing on the

1453
01:56:37,430 --> 01:56:38,610
decreasing volume signature.

1454
01:56:38,990 --> 01:56:43,270
And we probably would be correct. There
is a lot of increase of the demand on

1455
01:56:43,270 --> 01:56:44,270
the previous bar.

1456
01:56:44,330 --> 01:56:48,230
And then after that, the demand is
exhausted.

1457
01:56:49,070 --> 01:56:53,590
And it's not as much as on the previous
bar. So it's going to be shown in the

1458
01:56:53,590 --> 01:56:56,710
volume signature and it's going to be
shown in the result, in the spread.

1459
01:56:57,550 --> 01:57:02,450
With the supply, this is a little bit
difficult here for us to say from the

1460
01:57:02,450 --> 01:57:03,450
volume signature.

1461
01:57:03,510 --> 01:57:07,510
Our natural inclination is going to be
that supply is decreasing as well, which

1462
01:57:07,510 --> 01:57:08,970
is because the volume is decreasing.

1463
01:57:09,470 --> 01:57:13,030
And I think that regularly this is what
I would go for.

1464
01:57:13,670 --> 01:57:16,930
But I also could see how supply could
stay at the same level.

1465
01:57:17,320 --> 01:57:19,980
And that also would suggest some kind of
bearish behavior.

1466
01:57:20,420 --> 01:57:27,420
And also supply could slightly increase
from the day when the, let's

1467
01:57:27,420 --> 01:57:31,440
say we had the day like this, where
demand is increasing and supply is

1468
01:57:31,440 --> 01:57:35,420
decreasing. So imagine that the volume
signature is even lower.

1469
01:57:35,680 --> 01:57:38,820
So this could mean that supply also is
decreasing.

1470
01:57:39,100 --> 01:57:45,870
Well, one way or another, what is
happening here is that Demand is

1471
01:57:46,050 --> 01:57:50,090
and that suggests some kind of
vulnerability to the reaction.

1472
01:57:50,670 --> 01:57:57,390
So it's interesting how in both cases
number two and three, we

1473
01:57:57,390 --> 01:58:02,730
are suggesting that the reaction should
come.

1474
01:58:03,310 --> 01:58:09,330
But yet, there is a subtle difference
here. And hopefully, guys, you already

1475
01:58:09,330 --> 01:58:10,610
know what it is.

1476
01:58:11,240 --> 01:58:17,080
And that subtle difference is in the
emergence of the supply on the volume

1477
01:58:17,080 --> 01:58:18,340
signature that is increasing.

1478
01:58:18,700 --> 01:58:21,020
This is more bearish

1479
01:58:21,020 --> 01:58:27,080
than the

1480
01:58:27,080 --> 01:58:33,900
scenario where the volume decreases and
supply might be decreasing as well with

1481
01:58:33,900 --> 01:58:38,400
it. Because that would suggest that,
yes, demand is exhausted.

1482
01:58:39,280 --> 01:58:45,540
But at the same time, there are no
selling. In case number two, demand

1483
01:58:45,540 --> 01:58:51,980
there, but supply is definitely present
and it's increasing. So somebody's

1484
01:58:51,980 --> 01:58:56,600
selling. And that's kind of like that
subtle difference between number two and

1485
01:58:56,600 --> 01:58:57,539
number three.

1486
01:58:57,540 --> 01:59:04,080
Number four, increasing spread and
decreasing volume signature.

1487
01:59:04,280 --> 01:59:07,200
So it's different than scenario number
one.

1488
01:59:08,880 --> 01:59:10,260
How do we interpret this?

1489
01:59:10,900 --> 01:59:17,800
Increasing result in the uptrend. We're
having a big spread to the upside on

1490
01:59:17,800 --> 01:59:19,060
the decreasing effort.

1491
01:59:19,560 --> 01:59:25,720
So the decreasing effort suggests a
decrease of the demand

1492
01:59:25,720 --> 01:59:28,900
together with the decrease of the
supply.

1493
01:59:29,200 --> 01:59:36,160
And it's this decrease of the supply
that makes it a bullish scenario because

1494
01:59:36,160 --> 01:59:41,970
it basically tells us that There is no
one selling at this point, and therefore

1495
01:59:41,970 --> 01:59:47,670
supply is not available, and demand is
also decreasing, but there is no need

1496
01:59:47,670 --> 01:59:49,810
a lot of demand to push the price up.

1497
01:59:50,210 --> 01:59:56,730
We would refer to this type of action as
an ease of movement, and we'll talk

1498
01:59:56,730 --> 01:59:57,890
more about this.

1499
01:59:58,370 --> 02:00:04,490
Ease of movement suggests a progression
of the price in the direction of a

1500
02:00:04,490 --> 02:00:05,490
current trend.

1501
02:00:06,840 --> 02:00:13,640
decreasing effort where the opposite
force whether

1502
02:00:13,640 --> 02:00:20,480
it's a supply or demand is decreasing as
well last

1503
02:00:20,480 --> 02:00:27,340
one number five spread is increasing
volume is increasing and it's increasing

1504
02:00:27,340 --> 02:00:34,260
massively so there is a massive volume
signature and that represents a

1505
02:00:34,260 --> 02:00:37,360
massive effort to push the price up.

1506
02:00:37,560 --> 02:00:41,800
And usually we would see this on the
chart as like a big, big volume spike.

1507
02:00:42,220 --> 02:00:48,120
And we would be talking about the volume
spike as the massive increase in volume

1508
02:00:48,120 --> 02:00:53,380
that suggests that the demand is still
there and it's increasing as well.

1509
02:00:53,660 --> 02:00:56,960
But at the same time, supply is
increasing too.

1510
02:00:57,400 --> 02:01:00,560
It's not only present and it's not only
increasing.

1511
02:01:01,040 --> 02:01:06,500
Relative to the previous examples that
we've seen where a supply might

1512
02:01:07,040 --> 02:01:12,240
we are seeing that here an increase of
the supply is substantial.

1513
02:01:16,000 --> 02:01:19,020
And that suggests institutional selling.

1514
02:01:20,360 --> 02:01:24,660
And with institutional selling, the
short -term scenario is always going to

1515
02:01:24,660 --> 02:01:29,820
bearish. And usually that's what kind of
produces those stopping actions as

1516
02:01:29,820 --> 02:01:30,940
buying climaxes.

1517
02:01:31,520 --> 02:01:36,280
This is where a lot of exchange of
shares is going to happen.

1518
02:01:36,620 --> 02:01:40,700
This could be a terminal buying climax.
This could be intermediate buying

1519
02:01:40,700 --> 02:01:41,700
climax.

1520
02:01:42,020 --> 02:01:46,620
Usually it would happen into the
overbought, overthrown condition.

1521
02:01:47,100 --> 02:01:49,160
That's kind of like a preferred
scenario.

1522
02:01:49,680 --> 02:01:54,680
It also could have, we could also see it
in the trading range.

1523
02:01:55,130 --> 02:01:58,930
maybe a climactic type of action into
the point of the resistance.

1524
02:01:59,370 --> 02:02:04,910
And then this could act maybe as an
upthrust in that structure.

1525
02:02:05,190 --> 02:02:07,590
So that's a possibility as well.

1526
02:02:08,290 --> 02:02:13,230
So let's see if we have any questions on
this before we move on.

1527
02:02:14,990 --> 02:02:16,370
Questions, comments?

1528
02:02:18,990 --> 02:02:22,650
This should be probably...

1529
02:02:26,080 --> 02:02:28,540
Easy to grab as an idea.

1530
02:02:29,280 --> 02:02:34,860
The only thing here is that I want you
to concentrate on is, and obviously I

1531
02:02:34,860 --> 02:02:40,380
want you to go through this as you go
through your homework.

1532
02:02:42,940 --> 02:02:46,560
I definitely want you to remember this
scenario.

1533
02:02:47,480 --> 02:02:52,020
All right, so now Lesha's asking, how do
open and close levels impact?

1534
02:02:52,640 --> 02:02:53,640
these interpretations?

1535
02:02:54,220 --> 02:03:00,380
I think we're going to answer this
question a little bit later on, but this

1536
02:03:00,380 --> 02:03:02,920
good one, so let's keep that in mind.

1537
02:03:03,760 --> 02:03:08,880
For now, we just want to concentrate on
the spread and volume in that

1538
02:03:08,880 --> 02:03:09,880
relationship.

1539
02:03:10,720 --> 02:03:12,880
Okay, let's look at the next one.

1540
02:03:13,620 --> 02:03:20,480
In the declining market, where the
context is the downtrend, let's look at

1541
02:03:20,480 --> 02:03:21,960
all of these scenarios again.

1542
02:03:22,380 --> 02:03:26,380
They're going to be just a mirror image
of the ones that we looked for the

1543
02:03:26,380 --> 02:03:27,380
advancing market.

1544
02:03:28,060 --> 02:03:30,580
Spread is increasing, volume is
increasing.

1545
02:03:32,980 --> 02:03:36,160
It's an increasing result with the
increasing effort.

1546
02:03:36,500 --> 02:03:42,260
And when the volume signature is normal,
this is just a normal activity in the

1547
02:03:42,260 --> 02:03:43,300
downtrend action.

1548
02:03:43,580 --> 02:03:48,560
This is where supply is going to
increase and it's going to still

1549
02:03:48,560 --> 02:03:54,670
demand. Demand could be very easily
decreasing at this point of time. The

1550
02:03:54,670 --> 02:03:58,930
-term bias for this interpretation is
going to be bearish and a continuation

1551
02:03:58,930 --> 02:03:59,930
the downside.

1552
02:04:00,410 --> 02:04:06,210
Next one, in scenario number seven,
decreasing spread and increasing volume

1553
02:04:06,210 --> 02:04:12,630
signature. So we're seeing that the
spread has decreased significantly, and

1554
02:04:12,630 --> 02:04:18,250
the volume signature still is going up.
So we have a case of the decreasing

1555
02:04:18,250 --> 02:04:19,250
result,

1556
02:04:19,470 --> 02:04:25,750
happening on the increasing effort,
where supply is still increasing,

1557
02:04:26,130 --> 02:04:29,750
but we already see some emergence of the
demand.

1558
02:04:30,070 --> 02:04:34,350
And this demand attempts to stop the
downtrend.

1559
02:04:34,770 --> 02:04:35,970
That's the intention.

1560
02:04:36,230 --> 02:04:42,210
Just because the volume signature is so
high, that suggests that this emergence

1561
02:04:42,210 --> 02:04:46,570
of the demand could stop the trend from
going further.

1562
02:04:48,430 --> 02:04:53,450
further down. And by the way, when I say
that stop the trend, it could be even a

1563
02:04:53,450 --> 02:04:59,490
temporary stopping. It could produce
just a temporary short -term rally and

1564
02:04:59,490 --> 02:05:04,070
continue with the downtrend. Or it could
produce a more meaningful move to the

1565
02:05:04,070 --> 02:05:08,570
upside. It's all contextual. We will
have to look at where exactly it

1566
02:05:08,810 --> 02:05:14,030
But for the short -term buys, we're
always going to be thinking bullish in

1567
02:05:14,030 --> 02:05:19,070
scenario. We would be thinking that
Demand is there. It's emerging. It's

1568
02:05:19,070 --> 02:05:21,030
increasing. It's absorbing the supply.

1569
02:05:21,370 --> 02:05:26,110
So the downtrend is vulnerable at this
point of time.

1570
02:05:26,550 --> 02:05:31,810
The same would happen on the diminishing
spread and the diminishing volume

1571
02:05:31,810 --> 02:05:32,810
signature.

1572
02:05:33,350 --> 02:05:39,770
We would be thinking that demand is
diminishing at this point.

1573
02:05:40,110 --> 02:05:45,170
Now, the only difference between this
and the previous scenario, scenario

1574
02:05:45,170 --> 02:05:50,950
seven, is that in scenario number eight,
supply is decreasing as well. The

1575
02:05:50,950 --> 02:05:53,670
overall signature, volume signature, is
going down.

1576
02:05:53,950 --> 02:05:59,010
So most likely, we're going to have
diminished supply and diminished demand

1577
02:05:59,010 --> 02:06:00,010
the same time.

1578
02:06:00,090 --> 02:06:05,130
Now, that's actually still preferable to

1579
02:06:05,130 --> 02:06:12,110
the bearish scenario, just because
demand is

1580
02:06:12,110 --> 02:06:12,829
not there.

1581
02:06:12,830 --> 02:06:13,970
Demand is poor.

1582
02:06:15,940 --> 02:06:19,320
diminishing supply could push the price
further down.

1583
02:06:21,000 --> 02:06:27,860
Okay, and this is where I see the
mistake. So this would be, oh no,

1584
02:06:27,860 --> 02:06:28,779
that's fine.

1585
02:06:28,780 --> 02:06:35,140
Okay, so next one, number nine,
increasing spread and decreasing

1586
02:06:35,140 --> 02:06:36,380
volume signature.

1587
02:06:37,440 --> 02:06:40,860
So if we would compare it to number six.

1588
02:06:41,740 --> 02:06:48,360
That would be a good comparison. I
probably need to shift them a little bit

1589
02:06:48,360 --> 02:06:53,520
here. Okay, so what do we see on the
results? Obviously, increasing results

1590
02:06:53,520 --> 02:06:54,520
this type of spread.

1591
02:06:54,720 --> 02:06:58,020
And then it happens on the decrease in
effort.

1592
02:06:59,200 --> 02:07:05,780
Volume signature goes down. So that
suggests both decrease of the supply and

1593
02:07:05,780 --> 02:07:07,760
decrease of the demand.

1594
02:07:09,040 --> 02:07:15,440
And that suggests, again, and ease of
movement, as the price could move

1595
02:07:15,440 --> 02:07:22,440
lower on diminishing demand signature,
and therefore it is a short -term

1596
02:07:22,440 --> 02:07:23,440
bearish interpretation.

1597
02:07:24,120 --> 02:07:28,160
I see the mistake right here. It should
be bullish here.

1598
02:07:33,240 --> 02:07:35,360
Decreasing result, decreasing effort.

1599
02:07:38,660 --> 02:07:39,660
Decreasing demand.

1600
02:07:42,440 --> 02:07:43,440
Just a continuation.

1601
02:07:43,860 --> 02:07:45,680
What did I do on the previous slide?

1602
02:07:47,540 --> 02:07:48,540
I see.

1603
02:07:51,660 --> 02:07:58,620
Okay. I think this is the one that
should be bullish.

1604
02:08:00,560 --> 02:08:01,740
Apologies for that.

1605
02:08:02,280 --> 02:08:05,800
So vulnerable to rally. So yes, bullish.

1606
02:08:06,080 --> 02:08:10,480
I was thinking like, I'm going to make a
mistake somewhere. So this is it.

1607
02:08:13,299 --> 02:08:18,200
Okay, so ease of movement. And then the
last one is the climactic one, right? So

1608
02:08:18,200 --> 02:08:24,920
selling climax with the massive volume
signature, massive effort behind it.

1609
02:08:25,100 --> 02:08:29,620
Supply is increasing a lot because of
the panic he is selling by weekends.

1610
02:08:29,840 --> 02:08:35,920
But demand is increasing at a much
faster rate than anything that we've

1611
02:08:35,920 --> 02:08:38,800
before on the demand increase.

1612
02:08:39,480 --> 02:08:45,200
So therefore, we're concluding that this
is an institutional demand, and

1613
02:08:45,200 --> 02:08:46,760
therefore, it's bullish.

1614
02:08:47,060 --> 02:08:50,060
A stop in action, reversal, and

1615
02:08:50,060 --> 02:08:54,940
attempt to rally.

1616
02:08:56,080 --> 02:09:00,740
Okay, yeah, thank you, Philip. That's
great. I like the fact that you like the

1617
02:09:00,740 --> 02:09:05,780
slides. Yeah, we're trying to make them
simple, but yet very informative.

1618
02:09:06,720 --> 02:09:10,520
These are the slides that I want you
guys to print out. Again, you know, in

1619
02:09:10,520 --> 02:09:11,520
case right here.

1620
02:09:12,020 --> 02:09:15,500
Let me just correct this right away.

1621
02:09:19,700 --> 02:09:21,820
So here it's actually bullish.

1622
02:09:41,290 --> 02:09:46,870
All right, guys, so something to think
about, study, print those out, go

1623
02:09:46,870 --> 02:09:53,610
through, because we're going to use
those a lot in our group exercise.

1624
02:09:54,590 --> 02:09:59,950
Speaking of homework, so this is the
first homework from this class. We are

1625
02:09:59,950 --> 02:10:05,610
going to look into the volume and spread
analysis, and what I want you to do is

1626
02:10:05,610 --> 02:10:10,370
to visualize all concepts from previous
two slides, number 19 and 20.

1627
02:10:10,860 --> 02:10:11,960
on any of the charts.

1628
02:10:12,300 --> 02:10:18,200
So take all of these 10 scenarios, 1, 2,
3, 4, 5, 6, 7, 8, 9, 10, all of them,

1629
02:10:18,280 --> 02:10:20,580
and find

1630
02:10:20,580 --> 02:10:27,340
examples on preferably

1631
02:10:27,340 --> 02:10:32,480
one chart. I am not expecting you to
send me 10 charts for different

1632
02:10:32,780 --> 02:10:39,680
I want you to find maybe like one chart
that would contain If not all of them,

1633
02:10:39,740 --> 02:10:46,280
then the majority of them. And just send
this slide to me or chart

1634
02:10:46,280 --> 02:10:50,980
and identify all of these 10 scenarios.

1635
02:10:52,300 --> 02:10:54,840
All right, so that's homework number
one.

1636
02:10:55,200 --> 02:11:00,920
Now let's talk about the laws of supply
and demand and effort versus result.

1637
02:11:01,240 --> 02:11:04,840
So as you know, Wyckoff Method has three
laws.

1638
02:11:05,120 --> 02:11:06,840
The first one is...

1639
02:11:07,180 --> 02:11:08,560
the law of supply and demand.

1640
02:11:08,880 --> 02:11:15,580
And on a very basic level, it just
basically says that if you

1641
02:11:15,580 --> 02:11:21,660
have more demand than supply, then the
price will go up. When you have more

1642
02:11:21,660 --> 02:11:26,460
supply than demand, then the price will
fall. And sometimes I think we

1643
02:11:26,460 --> 02:11:32,280
overcomplicate our volume and price
analysis and we forget about this simple

1644
02:11:32,280 --> 02:11:35,240
interpretation of the supply and demand.

1645
02:11:35,820 --> 02:11:36,840
and what it means.

1646
02:11:37,320 --> 02:11:40,440
So I want to point your attention to
that.

1647
02:11:41,280 --> 02:11:47,760
Now, the biggest law for me in the whole
methodology is

1648
02:11:47,760 --> 02:11:50,220
the law of effort versus result.

1649
02:11:50,600 --> 02:11:56,800
Because effort versus result encompasses
both a situation where a supply is

1650
02:11:56,800 --> 02:12:02,100
larger than demand and the price goes
down.

1651
02:12:03,090 --> 02:12:07,310
and when demand is larger than supply
and the price goes up easily.

1652
02:12:08,350 --> 02:12:12,610
But it also suggests a different
scenario.

1653
02:12:13,350 --> 02:12:19,790
It suggests that when we have an
increase in effort

1654
02:12:19,790 --> 02:12:24,730
and decrease in the result,

1655
02:12:24,930 --> 02:12:29,110
we are going to have an opposite

1656
02:12:31,760 --> 02:12:37,380
counter to the general observation of
the increased effort conclusion.

1657
02:12:38,340 --> 02:12:44,260
We will basically say that the price is
going to do an opposite thing.

1658
02:12:44,580 --> 02:12:50,560
And that's what we need to learn. And
that's why the law of effort versus

1659
02:12:50,560 --> 02:12:52,220
is so important.

1660
02:12:52,640 --> 02:12:57,780
So how would we measure the effort?
Well, obviously we're going to look at

1661
02:12:57,780 --> 02:13:01,280
volume signature and we're going to say
that volume is just the representation

1662
02:13:01,280 --> 02:13:02,440
of the effort.

1663
02:13:02,680 --> 02:13:07,600
But we're going to be a little bit more
specific about the effort.

1664
02:13:07,840 --> 02:13:14,440
And to me, effort is either increase or
decrease in the volume signature.

1665
02:13:15,260 --> 02:13:18,400
It's not just the volume signature
itself.

1666
02:13:19,740 --> 02:13:26,200
It's the way with which the volume
changes right so we usually would say

1667
02:13:26,200 --> 02:13:32,440
see an increased volume signature that
would mean that the effort

1668
02:13:32,440 --> 02:13:38,740
to push the price down has increased a
lot

1669
02:13:38,740 --> 02:13:44,500
and what do we see we see some
progression but we also see some kind of

1670
02:13:44,500 --> 02:13:49,220
action that suggests that behind this
increasing the volume signature there is

1671
02:13:49,220 --> 02:13:50,220
some demand signature

1672
02:13:51,180 --> 02:13:52,520
and there are some buyers.

1673
02:13:52,840 --> 02:13:59,040
Because of the extreme volume signature,
it's an institutional buyer.

1674
02:13:59,260 --> 02:14:05,960
And actually, we know exactly who was
buying Goldman Sachs in 2008

1675
02:14:05,960 --> 02:14:11,500
in September. There was some news that
came out during that month that Warren

1676
02:14:11,500 --> 02:14:17,860
Buffett was buying the stock through
warrants at a price of $120.

1677
02:14:19,340 --> 02:14:21,760
Please note that the price went below
$60.

1678
02:14:22,720 --> 02:14:28,400
And he still held on to that position,
obviously because of the warrants. I

1679
02:14:28,400 --> 02:14:29,400
understand that.

1680
02:14:29,620 --> 02:14:36,380
But the CEO type of institutions are
thinking in a different

1681
02:14:36,380 --> 02:14:37,700
way than we do.

1682
02:14:38,460 --> 02:14:42,640
And our task is obviously to understand
how they think and how they behave.

1683
02:14:43,660 --> 02:14:47,180
So, and this is what we're studying in
this course. And you could see from this

1684
02:14:47,180 --> 02:14:52,660
example, if he's buying, you know, the
price goes up and then it

1685
02:14:52,660 --> 02:14:57,540
observes a lot of available supply at
this level.

1686
02:14:58,300 --> 02:15:03,920
So then the next time the price goes
down, supply is going down and someone

1687
02:15:03,920 --> 02:15:04,920
is buying.

1688
02:15:05,300 --> 02:15:07,640
And then all of the other times,

1689
02:15:08,520 --> 02:15:13,720
Again, supply is going down. So there is
absorption process that is underway

1690
02:15:13,720 --> 02:15:18,560
that has started with Warren Buffett
purchases here.

1691
02:15:18,780 --> 02:15:25,380
And then whatever he observed is no
longer available in the market or

1692
02:15:25,380 --> 02:15:29,580
whatever other institutions observed at
this point of time. And therefore,

1693
02:15:29,580 --> 02:15:33,640
supply is still going to be relatively
high to the averages.

1694
02:15:35,680 --> 02:15:39,900
relative to the previous spikes is going
to be smaller just because absorption

1695
02:15:39,900 --> 02:15:40,900
has happened.

1696
02:15:42,580 --> 02:15:49,240
So what we want to see from the effort
is the increase or the decrease of

1697
02:15:49,240 --> 02:15:50,240
effort.

1698
02:15:50,540 --> 02:15:55,400
And then obviously when we're going to
have an extreme increase in effort, that

1699
02:15:55,400 --> 02:16:00,180
usually is going to be associated with
gaps, with stopping actions, with

1700
02:16:00,180 --> 02:16:02,720
momentum type of bars, and so on and so
forth.

1701
02:16:03,050 --> 02:16:07,890
We need to understand how we will judge
the result, how we would assess the

1702
02:16:07,890 --> 02:16:12,050
result. Obviously, results will either
increase or decrease as well.

1703
02:16:12,310 --> 02:16:19,250
So I've developed specific measurements,
and those are just for our

1704
02:16:19,250 --> 02:16:21,530
WTC course.

1705
02:16:21,910 --> 02:16:28,630
I want us to look into the increase or
the decrease of a spread or a

1706
02:16:28,630 --> 02:16:29,630
true range.

1707
02:16:30,350 --> 02:16:33,230
And we'll talk about this in the next
class.

1708
02:16:34,290 --> 02:16:41,010
We're also going to look into the close.
And we will be thinking about two ways

1709
02:16:41,010 --> 02:16:42,830
of how to address the close.

1710
02:16:43,049 --> 02:16:49,610
And the question from Nilesh was
previously about how would

1711
02:16:49,610 --> 02:16:56,110
the close or the closes influence our
interpretation

1712
02:16:56,110 --> 02:16:57,150
of the result.

1713
02:16:57,709 --> 02:17:00,549
So we will look into the close from two
perspectives.

1714
02:17:01,469 --> 02:17:07,990
Relative to the daily spread or a true
range, right? So we would be looking at

1715
02:17:07,990 --> 02:17:14,510
how do we close relative to the

1716
02:17:14,510 --> 02:17:20,990
actual height

1717
02:17:20,990 --> 02:17:25,030
of the spread, right?

1718
02:17:26,190 --> 02:17:32,150
If we're closing in the upper part above
one half of the spread, we're going to

1719
02:17:32,150 --> 02:17:33,629
interpret this as bullish.

1720
02:17:33,910 --> 02:17:40,510
If we're closing below one half, we are
going to interpret it as bearish close.

1721
02:17:41,070 --> 02:17:45,709
And then we're also going to look at the
closes from the perspective of the

1722
02:17:45,709 --> 02:17:50,090
previous close. So we're going to look
at the previous close, and then we're

1723
02:17:50,090 --> 02:17:54,129
going to make a judgment as to...

1724
02:17:54,440 --> 02:18:00,100
the next close, and we're going to look
at the progression of close to close.

1725
02:18:00,240 --> 02:18:06,940
Because think about closes as the
commitment of institutional

1726
02:18:06,940 --> 02:18:11,700
traders in the direction of the current
swing or current trend.

1727
02:18:11,980 --> 02:18:16,639
So it's going to be extremely important
for us to see what's the progress

1728
02:18:16,639 --> 02:18:19,440
between one close to another.

1729
02:18:20,040 --> 02:18:23,840
And then the third one is going to be
extremely important.

1730
02:18:24,400 --> 02:18:31,260
And it's going to be somewhat difficult
for

1731
02:18:31,260 --> 02:18:35,879
us to remember that this is something
that we will be looking at. It's the

1732
02:18:35,879 --> 02:18:42,059
intention. And the intention behind the
bar is always going to be overcoming

1733
02:18:42,059 --> 02:18:46,059
some kind of commitment line. It could
be a resistance.

1734
02:18:46,280 --> 02:18:51,160
It could be the previous day bar high.

1735
02:18:53,020 --> 02:18:59,360
And if we see that commitment above,
we're going to say that the intention

1736
02:18:59,360 --> 02:19:06,120
fulfilled. If we're going to have a bar
that comes close to that, maybe

1737
02:19:06,120 --> 02:19:11,700
even attempts to commit, but then comes
back, we're going to say that the

1738
02:19:11,700 --> 02:19:18,160
intention to commit above the commitment
line or the specific resistance line

1739
02:19:18,160 --> 02:19:20,400
has failed. So therefore...

1740
02:19:20,969 --> 02:19:25,129
As a result, we're going to say that
intention has failed. We're going to say

1741
02:19:25,129 --> 02:19:30,110
no. And that would mean that the result
is diminishing.

1742
02:19:30,930 --> 02:19:34,370
And that's a very, very important point.

1743
02:19:35,290 --> 02:19:36,290
Volume spikes.

1744
02:19:36,469 --> 02:19:41,709
Well, we kind of discussed those in the
previous two slides, but still again, up

1745
02:19:41,709 --> 02:19:48,250
spike is going to be on the up bar where
demand still dominates the supply, but

1746
02:19:48,250 --> 02:19:49,810
supply is already increasing.

1747
02:19:50,430 --> 02:19:54,010
and it's producing some selling.

1748
02:19:55,190 --> 02:20:00,750
The down spike is going to be where
supply is going to dominate the demand,

1749
02:20:00,750 --> 02:20:07,350
demand is already increasing as well,
and it's absorbing the supply at that

1750
02:20:07,350 --> 02:20:10,810
point of time. It's adjusting the stop
in action and the reversal.

1751
02:20:11,950 --> 02:20:13,270
So, again,

1752
02:20:14,010 --> 02:20:16,990
this is something that I want you to
remember by heart.

1753
02:20:18,520 --> 02:20:22,060
What do we look at in the effort? What
do we look at in the result?

1754
02:20:22,480 --> 02:20:26,300
Especially how do we measure the result?
That's extremely important.

1755
02:20:26,700 --> 02:20:33,320
Then I also want you to understand that
in some cases, for instance, in the case

1756
02:20:33,320 --> 02:20:38,920
of this latest reaction, we are going to
have an increased volume signature

1757
02:20:38,920 --> 02:20:45,640
that would suggest or equal an increased
downward pressure.

1758
02:20:47,800 --> 02:20:50,120
to the downside is increasing.

1759
02:20:50,500 --> 02:20:54,500
And we're gonna look at this reaction
and we're gonna say this reaction is

1760
02:20:54,500 --> 02:20:55,500
actually not that big.

1761
02:20:56,040 --> 02:21:00,420
It's actually in line with the previous
reaction and it's less than the

1762
02:21:00,420 --> 02:21:05,140
reactions that we've seen before at the
beginning of the move. So therefore,

1763
02:21:05,480 --> 02:21:12,080
we're gonna say that the result to the
downside has decreased.

1764
02:21:12,780 --> 02:21:17,300
So what's interesting is that Here,
there is an opposite

1765
02:21:17,300 --> 02:21:21,840
trajectory for effort and the result.

1766
02:21:22,520 --> 02:21:29,440
The effort is trying to stay up and is
trying to increase and

1767
02:21:29,440 --> 02:21:35,000
to push the price up. So the effort to
push the price up increases while the

1768
02:21:35,000 --> 02:21:36,640
result is somewhat mediocre.

1769
02:21:37,680 --> 02:21:42,600
And this is where this law of effort
versus result is so valuable.

1770
02:21:45,160 --> 02:21:51,000
That increased effort on the increased
volume signature and inability to push

1771
02:21:51,000 --> 02:21:54,120
the price down would suggest that
something is interfering.

1772
02:21:55,360 --> 02:22:01,400
Something is stopping the

1773
02:22:01,400 --> 02:22:06,520
selling from pushing the price further
down.

1774
02:22:06,780 --> 02:22:08,080
What could it be?

1775
02:22:09,980 --> 02:22:11,180
Only one thing.

1776
02:22:11,680 --> 02:22:12,680
Buying.

1777
02:22:14,450 --> 02:22:15,730
Or demand?

1778
02:22:17,350 --> 02:22:24,270
Well, not just a regular demand,
probably institutional demand, just

1779
02:22:24,270 --> 02:22:30,970
the volume went up so high and the
public cannot have that type of volume

1780
02:22:30,970 --> 02:22:31,970
signature.

1781
02:22:33,810 --> 02:22:36,610
And that's why this law is so important.

1782
02:22:37,390 --> 02:22:41,510
Out of all of the three laws, if you
will remember one, remember this one.

1783
02:22:41,610 --> 02:22:43,570
Remember the effort versus result.

1784
02:22:47,690 --> 02:22:53,350
Okay, next question. Should the increase
or decrease in volume be compared to

1785
02:22:53,350 --> 02:22:56,990
local volume signature or meet long
-term levels as well?

1786
02:22:57,330 --> 02:23:00,150
Now, again, really good questions. I
like that.

1787
02:23:01,550 --> 02:23:05,670
It's just that they're a little bit
ahead of where we are. So we'll

1788
02:23:05,670 --> 02:23:12,150
discuss that during our exercise, and
we'll definitely discuss both, the more

1789
02:23:12,150 --> 02:23:14,310
local increase and more.

1790
02:23:14,860 --> 02:23:20,640
long -term increase, and we'll just go
through this material.

1791
02:23:21,400 --> 02:23:24,180
Okay, now the exciting part.

1792
02:23:24,460 --> 02:23:29,820
Okay, so we are starting our group
exercise, and I will need a volunteer at

1793
02:23:29,820 --> 02:23:32,800
point. So think about this for a second.

1794
02:23:33,420 --> 02:23:38,440
Meanwhile, our exercise is going to be
devoted to both volume and price

1795
02:23:38,440 --> 02:23:40,000
and price structural analysis.

1796
02:23:40,320 --> 02:23:43,380
This is the exercise where we are going
to combine

1797
02:23:44,140 --> 02:23:50,180
the knowledge that we got on the price
structure, and the new information that

1798
02:23:50,180 --> 02:23:54,520
I'm going to still keep giving you
through all of the five classes that

1799
02:23:54,520 --> 02:23:56,380
going to have on volume and price.

1800
02:23:56,640 --> 02:24:03,400
The assignment for this exercise is to
identify what is dominant, supply or

1801
02:24:03,400 --> 02:24:10,000
demand. And we're going to dissect this
either with the single bar analysis or

1802
02:24:10,000 --> 02:24:11,060
with the SWIN analysis.

1803
02:24:11,840 --> 02:24:15,720
We, as I mentioned, are going to combine
the price structural analysis with

1804
02:24:15,720 --> 02:24:16,720
volume analysis.

1805
02:24:16,900 --> 02:24:23,700
I want you to make your call on what
kind of most probable

1806
02:24:23,700 --> 02:24:30,680
price action we will have after the
point of discussion on

1807
02:24:30,680 --> 02:24:32,360
the chart that we're going to look at.

1808
02:24:33,440 --> 02:24:39,400
I'm also going to ask you for labeling
of WICA phases and events.

1809
02:24:40,110 --> 02:24:42,530
of any of the trading ranges that you
see.

1810
02:24:42,970 --> 02:24:49,750
And most important task as a homework
task is going to be

1811
02:24:49,750 --> 02:24:56,730
to watch the video of this exercise
again and to

1812
02:24:56,730 --> 02:24:57,730
make some notes.

1813
02:24:58,110 --> 02:25:02,070
And then I want you to email these notes
to me.

1814
02:25:02,410 --> 02:25:05,510
So that's the assignment for this
exercise.

1815
02:25:05,990 --> 02:25:08,990
Now let's look at the

1816
02:25:09,779 --> 02:25:10,860
at the chart.

1817
02:25:11,400 --> 02:25:15,540
So this chart is going to be presented
to you like this.

1818
02:25:16,360 --> 02:25:21,540
There is no reference to the stock that
it is. There is no reference to the

1819
02:25:21,540 --> 02:25:27,700
time. And I've learned that this is only
just a distraction for students when I

1820
02:25:27,700 --> 02:25:29,020
give this type of information.

1821
02:25:30,440 --> 02:25:36,680
So it came to the point that I even
forgot what the stock is.

1822
02:25:37,230 --> 02:25:40,930
I do not know the name. I do not know
the symbol. Please don't ask me.

1823
02:25:41,490 --> 02:25:48,310
But what I'm really, really concerned
about here with this exercise is the

1824
02:25:48,310 --> 02:25:50,090
way how we're going to analyze this.

1825
02:25:50,410 --> 02:25:55,630
This is going to be such a foundational
exercise. This is something that I want

1826
02:25:55,630 --> 02:25:57,630
you to be extremely serious about.

1827
02:25:57,970 --> 02:26:02,630
I want you to be uncomfortable about
this exercise because there will be a

1828
02:26:02,630 --> 02:26:04,330
of concepts that we're going to combine.

1829
02:26:04,750 --> 02:26:06,030
And it's first time.

1830
02:26:06,540 --> 02:26:12,140
It just might, you know, see as kind of
like a, you know, a difficult thing to

1831
02:26:12,140 --> 02:26:17,840
do. But then something will click and
the understanding will come to you. It

1832
02:26:17,840 --> 02:26:19,200
will emerge in your mind.

1833
02:26:19,600 --> 02:26:22,820
And that's what we're trying to do with
this exercise.

1834
02:26:23,260 --> 02:26:30,100
To combine the volume and price with the
price structure and to start

1835
02:26:30,100 --> 02:26:31,520
talking about...

1836
02:26:31,870 --> 02:26:37,330
the logic of the analysis, how it flows,
how do we analyze it. And because of

1837
02:26:37,330 --> 02:26:44,250
this logic, I'm trying to create a
specific way of how we would be thinking

1838
02:26:44,250 --> 02:26:45,310
about this analysis.

1839
02:26:45,550 --> 02:26:48,630
So I want you to think about a bar
analysis first.

1840
02:26:48,870 --> 02:26:53,850
And each bar, not each bar, but each
significant bar that I want us to

1841
02:26:53,850 --> 02:26:56,810
has some kind of number assigned to it.

1842
02:26:57,310 --> 02:26:58,350
And then...

1843
02:26:58,710 --> 02:27:02,670
And we're going to discuss it from the
point of view of the effort and the

1844
02:27:02,670 --> 02:27:06,330
result, exactly what we went through
just now.

1845
02:27:06,530 --> 02:27:09,550
And then we're going to discuss a swing
analysis.

1846
02:27:09,970 --> 02:27:14,050
So we're going to look at the current
swing, so let's say swing number three,

1847
02:27:14,190 --> 02:27:20,050
and we're going to discuss, well,
relative to this swing, the previous

1848
02:27:20,050 --> 02:27:25,410
the downside, what characteristics we
see, and then the previous counter

1849
02:27:25,980 --> 02:27:30,440
like this one right here. So we're
basically going to compare a swing to a

1850
02:27:30,440 --> 02:27:36,220
swing. We also will talk about the
market behavioral analysis, and that is

1851
02:27:36,220 --> 02:27:41,260
behavior between strong and weak hands.
We're going to try to define for each

1852
02:27:41,260 --> 02:27:45,500
type of the market participant, what are
they doing at that spot?

1853
02:27:46,360 --> 02:27:51,300
And that will create a better
understanding for you as to what is

1854
02:27:51,300 --> 02:27:52,159
right now.

1855
02:27:52,160 --> 02:27:54,980
And then obviously we need final
deductions.

1856
02:27:55,610 --> 02:27:57,010
or rather inductions.

1857
02:27:58,130 --> 02:28:01,890
Those are going to be on the bias, on
the timing, and on the character.

1858
02:28:02,690 --> 02:28:07,350
And we'll talk about this more as we go
through this exercise.

1859
02:28:07,890 --> 02:28:10,150
But for now, I want you to do two
things.

1860
02:28:10,630 --> 02:28:13,230
We still have maybe half an hour to go.

1861
02:28:13,850 --> 02:28:19,470
So I want you to, for a couple of
minutes, maybe two or three minutes, and

1862
02:28:19,470 --> 02:28:23,350
mute myself, and I'll go grab some tea.

1863
02:28:24,950 --> 02:28:31,910
I want you to look at this chart and to
analyze the first maybe

1864
02:28:31,910 --> 02:28:32,910
three swings.

1865
02:28:33,510 --> 02:28:38,270
And we'll talk about this and hopefully
we'll be able to cover even more today

1866
02:28:38,270 --> 02:28:39,950
in this 30 minutes.

1867
02:28:40,210 --> 02:28:44,510
But if not, then let's just concentrate
on the swing number one, swing number

1868
02:28:44,510 --> 02:28:45,670
two, and swing number three.

1869
02:28:46,770 --> 02:28:53,730
And secondly, I want you to say yes if
you would like to volunteer

1870
02:28:53,730 --> 02:28:54,730
and to go.

1871
02:28:54,890 --> 02:28:56,250
with me through this analysis.

1872
02:28:57,710 --> 02:29:03,690
Thirdly, for the homework, this is the
type of the

1873
02:29:03,690 --> 02:29:07,750
structure, analytical structure that I
want you to have.

1874
02:29:08,610 --> 02:29:14,670
And I want you, as you analyze, and the
homework is going to be to analyze the

1875
02:29:14,670 --> 02:29:15,670
rest.

1876
02:29:16,410 --> 02:29:21,890
I want you to analyze all of the bars
and all of the swings. You don't have to

1877
02:29:21,890 --> 02:29:22,890
do it.

1878
02:29:22,910 --> 02:29:26,910
all at the same time. You could do this
at your own pace.

1879
02:29:27,330 --> 02:29:30,970
I don't know where exactly we're going
to stop today. I don't know where we're

1880
02:29:30,970 --> 02:29:32,350
going to stop next week.

1881
02:29:32,590 --> 02:29:37,450
So therefore, just go at your own pace
and then compare your analysis to the

1882
02:29:37,450 --> 02:29:39,910
analysis that's going to be presented in
the class.

1883
02:29:40,450 --> 02:29:43,510
And we'll kind of see how that is going
to develop.

1884
02:29:43,890 --> 02:29:48,570
All right, so for now, two minutes break
for me, two break.

1885
02:29:49,290 --> 02:29:54,550
Meanwhile... I want you to think about
the analysis of the first three to five

1886
02:29:54,550 --> 02:29:58,730
swings and the analysis of the bars that
are being mentioned.

1887
02:29:58,930 --> 02:30:02,750
And also say yes if you'd like to
volunteer.

1888
02:30:03,090 --> 02:30:05,350
And we'll go from there. Thank you,
guys.

1889
02:32:28,200 --> 02:32:31,700
All right, guys, volunteers, maybe
someone new.

1890
02:32:34,740 --> 02:32:39,020
And obviously, I'm here to help, so
we're going to go through this together.

1891
02:32:41,160 --> 02:32:44,160
Okay, one, two, all right.

1892
02:32:45,700 --> 02:32:48,500
Okay, Nilesh, how are you doing today?

1893
02:32:50,220 --> 02:32:51,580
I'm doing good. How are you?

1894
02:32:51,880 --> 02:32:56,820
Good, good, good. Yeah, I just feel like
my throat hurts a little bit.

1895
02:32:58,279 --> 02:33:03,840
I had to stop at many spots, guys,
today, so I apologize for that.

1896
02:33:04,580 --> 02:33:10,840
All right, so let's start our analysis,
and let's start with bar number one,

1897
02:33:10,860 --> 02:33:12,520
right here.

1898
02:33:12,880 --> 02:33:19,660
This seems like a conclusion of SWIN
number one, and let's kind of discuss

1899
02:33:19,660 --> 02:33:20,840
this bar a little bit.

1900
02:33:21,600 --> 02:33:26,000
What do we see behind this bar for the
result and for the effort?

1901
02:33:29,260 --> 02:33:33,440
So the volume is slightly up compared to
the earlier close.

1902
02:33:35,860 --> 02:33:38,400
So the effort has increased.

1903
02:33:39,480 --> 02:33:45,580
So slightly increased, I would agree. So
there's not like a huge effort, right?

1904
02:33:45,640 --> 02:33:49,880
Because we're seeing it at Barnabas 1 as
the conclusion of the swing to the

1905
02:33:49,880 --> 02:33:50,880
downside, right?

1906
02:33:52,300 --> 02:33:56,360
But there is not a lot of increase.
There is some increase in the volume

1907
02:33:56,360 --> 02:33:58,860
signature that suggests What?

1908
02:34:00,940 --> 02:34:07,580
Demand is up slightly, and supply is
also,

1909
02:34:07,700 --> 02:34:09,400
I would say, still present.

1910
02:34:10,880 --> 02:34:14,020
Yeah, supply probably is still present.

1911
02:34:14,280 --> 02:34:18,440
It could be increasing at the same time.
I mean, this is such a bad reference

1912
02:34:18,440 --> 02:34:23,160
for us on the volume signature, but
you're right. It's at the highest point

1913
02:34:23,160 --> 02:34:24,220
the volume here.

1914
02:34:24,850 --> 02:34:31,050
We see it here, we see it here, we see
it here, slightly here. So it's one of

1915
02:34:31,050 --> 02:34:33,410
the highest increases.

1916
02:34:34,290 --> 02:34:39,470
But relative to what we see afterwards,
of course, this is just not relevant

1917
02:34:39,470 --> 02:34:44,250
that much. So what do you think is
dominating as an effort, supply or

1918
02:34:45,590 --> 02:34:48,230
I think demand is...

1919
02:34:48,620 --> 02:34:52,840
slightly dominating, just going by the
close of this candle.

1920
02:34:53,380 --> 02:34:58,520
Yeah, I think so too. Going by the
close, this is usually, it's going to be

1921
02:34:58,520 --> 02:35:03,140
defining factor for dominating effort.

1922
02:35:03,500 --> 02:35:06,960
So it closes exactly on the close of the
previous bar.

1923
02:35:07,160 --> 02:35:14,000
But the fact that it traveled up so
much, you know, and closed out of

1924
02:35:14,000 --> 02:35:16,880
kind of like a spring type of situation,
right?

1925
02:35:17,340 --> 02:35:21,900
where we might be thinking that this is
just a trading range right here, and

1926
02:35:21,900 --> 02:35:26,240
then the price goes below, and then it
recovers on the same day. So it's a

1927
02:35:26,240 --> 02:35:27,520
spring type of action.

1928
02:35:28,700 --> 02:35:32,900
So that suggests, yes, that demand
dominates over supply.

1929
02:35:33,420 --> 02:35:39,440
Okay, so what about the result?

1930
02:35:39,820 --> 02:35:43,600
what is the most kind of like obvious
result thing that we see? And I don't

1931
02:35:43,600 --> 02:35:46,740
think that for this particular bar,
we're going to go into a lot of the

1932
02:35:46,880 --> 02:35:51,340
but still, you mentioned the close,
right?

1933
02:35:53,460 --> 02:35:58,180
The close to the spread is in the upper
part, so that's bullish.

1934
02:35:59,760 --> 02:36:00,760
That's increasing.

1935
02:36:02,040 --> 02:36:06,440
Close to close, kind of the same. The
intention, what was the intention for

1936
02:36:06,440 --> 02:36:07,560
bar? What do you think?

1937
02:36:09,900 --> 02:36:16,900
To stop the downward movement. Okay,
yes. And also overcoming some kind

1938
02:36:16,900 --> 02:36:20,040
of commitment level. Where is the
commitment level for us?

1939
02:36:21,960 --> 02:36:25,500
The close of earlier candle, maybe?

1940
02:36:26,340 --> 02:36:33,080
Just all of these bars that are touching
this line, right? The support line. So

1941
02:36:33,080 --> 02:36:38,540
support line acts as that commitment
line for us, and we're closing above

1942
02:36:39,070 --> 02:36:43,350
So the intention was to go up and to
close above the commitment line, which

1943
02:36:43,350 --> 02:36:46,970
acted as a support, and we did exactly
that. So yes, bullish.

1944
02:36:47,670 --> 02:36:53,830
And it seems that we could say that the
effort

1945
02:36:53,830 --> 02:37:00,290
to the upside increased slightly, and
then the result to the upside

1946
02:37:00,290 --> 02:37:02,050
also increased.

1947
02:37:02,950 --> 02:37:04,370
Bullish or bearish?

1948
02:37:08,510 --> 02:37:11,690
Bullish. Bullish. So short -term
bullish.

1949
02:37:12,510 --> 02:37:16,770
And we could expect some kind of rally
out of this.

1950
02:37:17,810 --> 02:37:23,990
Okay. Well, the rally happens. It goes
into bar number two. And this is where

1951
02:37:23,990 --> 02:37:30,490
the whole story starts to unfold for

1952
02:37:30,490 --> 02:37:35,530
this area. So let's think about bar
number two analysis.

1953
02:37:35,750 --> 02:37:36,750
Okay.

1954
02:37:37,080 --> 02:37:39,240
So what is happening with effort?

1955
02:37:41,200 --> 02:37:47,320
Increased by a huge margin as compared
to the earlier ones. Okay, so effort is

1956
02:37:47,320 --> 02:37:50,960
increased a lot. Volume is increased a
lot.

1957
02:37:52,040 --> 02:37:54,320
Demand, is demand increasing?

1958
02:37:56,520 --> 02:38:02,540
I would say yes, but the supply too is
increased.

1959
02:38:03,240 --> 02:38:04,840
Okay, so demand has increased.

1960
02:38:05,140 --> 02:38:06,940
What is the dominating force?

1961
02:38:08,280 --> 02:38:14,680
Demand. Yeah, demand still dominates the
supply because the price has moved up,

1962
02:38:14,740 --> 02:38:15,740
closed up.

1963
02:38:15,880 --> 02:38:16,880
Okay, great.

1964
02:38:17,000 --> 02:38:22,240
And then what did you say about the
supply? Is supply going up or down?

1965
02:38:23,080 --> 02:38:24,840
Up. Up.

1966
02:38:25,300 --> 02:38:26,460
More than demand?

1967
02:38:27,280 --> 02:38:31,240
No, not more than demand. Not more than
demand, but it's going up.

1968
02:38:32,080 --> 02:38:38,000
So basically we have volume increase,
volume spike,

1969
02:38:38,260 --> 02:38:45,200
with the supply increase, I'm sorry,
with the demand increase, because demand

1970
02:38:45,200 --> 02:38:50,960
still dominant, and with the supply
increase as well, but it's not as

1971
02:38:50,960 --> 02:38:52,020
as the demand.

1972
02:38:53,380 --> 02:38:58,500
But this emergence of the supply
suggests that institutions are doing

1973
02:39:03,020 --> 02:39:05,420
Institutions are selling.

1974
02:39:06,860 --> 02:39:13,720
Why? Well, because we see two things,
what happens. In hindsight,

1975
02:39:14,480 --> 02:39:16,260
we see that the price went down.

1976
02:39:16,520 --> 02:39:21,720
So they're definitely selling into the
strength of weak hands.

1977
02:39:22,740 --> 02:39:29,240
And then what would be the second most
important?

1978
02:39:30,090 --> 02:39:33,670
identification that supplies of
institutional quality?

1979
02:39:34,590 --> 02:39:36,350
And that's the question for everyone.

1980
02:39:40,130 --> 02:39:46,450
I think the signature is too large to be
public.

1981
02:39:49,250 --> 02:39:53,170
Yeah, we know that. We know that there
is an institutional volume signature,

1982
02:39:53,410 --> 02:39:57,590
right? We're just trying to define
institutions are selling on this bar or

1983
02:39:57,590 --> 02:39:58,590
buying.

1984
02:39:59,470 --> 02:40:02,610
And by institutions, I obviously mean
strong hands.

1985
02:40:03,410 --> 02:40:08,990
What about, let's go further through the
list. What about the spread, the

1986
02:40:08,990 --> 02:40:11,050
result? Now let's discuss the result.

1987
02:40:12,990 --> 02:40:14,490
Spread has gone up.

1988
02:40:14,770 --> 02:40:20,310
Okay, so spread has increased
tremendously. Okay, so close relative to

1989
02:40:20,310 --> 02:40:21,310
spread.

1990
02:40:22,130 --> 02:40:23,170
Is bullish.

1991
02:40:23,530 --> 02:40:28,250
Bullish, because we are closing on the
spread in the...

1992
02:40:28,620 --> 02:40:33,880
upper part of the whole spread okay
close to close

1993
02:40:33,880 --> 02:40:38,420
so from this close to this close

1994
02:40:38,420 --> 02:40:44,840
bullish as well yes absolutely

1995
02:40:44,840 --> 02:40:49,820
yeah nothing to think about here because
we are just from close to close we're

1996
02:40:49,820 --> 02:40:55,340
traveling the biggest distance than
anything that we've seen before right so

1997
02:40:55,340 --> 02:40:56,360
close to close

1998
02:40:57,180 --> 02:40:59,440
Close to close and so on and so forth.

1999
02:41:00,140 --> 02:41:01,820
Okay, what about the intention?

2000
02:41:03,940 --> 02:41:10,620
Intention was to overcome the
resistance,

2001
02:41:10,800 --> 02:41:15,740
but I think it kind of failed because
such a huge increase in volume, but it

2002
02:41:15,740 --> 02:41:20,000
could not overcome the earlier
resistance.

2003
02:41:20,520 --> 02:41:22,160
Oh my gosh, yeah.

2004
02:41:23,120 --> 02:41:25,540
That's exactly where we want to go with
this.

2005
02:41:26,140 --> 02:41:27,960
Look at this resistance level.

2006
02:41:28,280 --> 02:41:32,060
And look at the bar in question. Huge
effort.

2007
02:41:33,140 --> 02:41:37,220
Think about all of this buying power
behind this bar.

2008
02:41:37,440 --> 02:41:42,860
And yet, if the intention was to
overcome the level of the resistance

2009
02:41:42,860 --> 02:41:49,780
created by these two highs right here,
where do we close? Because we're

2010
02:41:49,780 --> 02:41:52,140
closing below that level.

2011
02:41:52,940 --> 02:41:57,360
We just touch that level and then close
below it. What does that suggest?

2012
02:42:00,020 --> 02:42:01,620
Institutions are selling, probably.

2013
02:42:02,760 --> 02:42:03,760
Yeah,

2014
02:42:04,260 --> 02:42:09,180
most likely as the price goes into that
resistance level, institutions are

2015
02:42:09,180 --> 02:42:12,020
selling into the strength of weak hands.

2016
02:42:12,240 --> 02:42:16,280
And that's what's producing that
stopping action before that resistance

2017
02:42:16,280 --> 02:42:19,260
pushes the close below that level of the
resistance.

2018
02:42:20,080 --> 02:42:26,180
So now we know that institutions are
selling and the intention was not

2019
02:42:26,180 --> 02:42:33,100
fulfilled. So even though spread is
increasing, close to spread is bullish,

2020
02:42:33,240 --> 02:42:40,120
close to close is bullish, but because
of the intention and how it has failed

2021
02:42:40,120 --> 02:42:45,540
to materialize, we are going to say that
the result is actually diminishing.

2022
02:42:47,950 --> 02:42:54,610
effort result signature is going to look
like this up effort is increasing

2023
02:42:54,610 --> 02:43:01,350
a lot and then up result is actually
failing diminishing

2024
02:43:01,350 --> 02:43:08,250
so how would we interpret this as a
bullish short term or is it bearish

2025
02:43:08,250 --> 02:43:14,290
term bearish bearish yeah so what's
happening here

2026
02:43:14,290 --> 02:43:21,180
is lots of effort to put the price above
the commitment level, and

2027
02:43:21,180 --> 02:43:26,700
yet we cannot do this despite of all of
the bullish characteristics of the

2028
02:43:26,700 --> 02:43:32,880
spread. So therefore, we would be
thinking that institutions are selling.

2029
02:43:36,060 --> 02:43:41,240
And Philip is asking, we always care
about the intentions of the CEO or the

2030
02:43:41,240 --> 02:43:42,079
hands also.

2031
02:43:42,080 --> 02:43:45,160
Yeah, we care about different...

2032
02:43:46,230 --> 02:43:52,690
strong and weak hands, right? So we want
to understand where all of these market

2033
02:43:52,690 --> 02:43:56,430
participants are going to come in into
the market and how they're going to

2034
02:43:56,430 --> 02:44:01,330
behave. So from this perspective,
Barnabas, too, we would be thinking that

2035
02:44:01,330 --> 02:44:04,810
professionals are probably doing mean
reversion trade, right?

2036
02:44:05,190 --> 02:44:10,230
CEO is not participating at this point.

2037
02:44:10,940 --> 02:44:15,220
And then ITFs are not participating in
active.

2038
02:44:16,800 --> 02:44:20,640
And public, Nilesh, what do you think
public is doing here?

2039
02:44:22,180 --> 02:44:24,580
I think they are participating, they are
buying.

2040
02:44:24,880 --> 02:44:26,940
Yeah, they are buyers, exactly.

2041
02:44:28,380 --> 02:44:31,260
So they are on this particular bar.

2042
02:44:32,060 --> 02:44:37,540
Okay, so the next thing that happens is
bar number three.

2043
02:44:38,140 --> 02:44:45,080
And bar number three acts as a
confirmation for the selling pressure

2044
02:44:45,080 --> 02:44:46,720
come on bar number two.

2045
02:44:47,000 --> 02:44:49,180
Why is that, Nilesh?

2046
02:44:50,420 --> 02:44:56,920
Because it opened and closed, I think,
below the

2047
02:44:56,920 --> 02:44:57,920
earlier close.

2048
02:44:58,420 --> 02:45:03,000
Okay, so close and then open. Right away
we see some kind of gap.

2049
02:45:03,260 --> 02:45:05,240
So that's bearish by itself.

2050
02:45:06,520 --> 02:45:11,890
Okay. But more importantly, and Doug is
asking here, isn't it too early to make

2051
02:45:11,890 --> 02:45:13,730
that judgment about bar number two?

2052
02:45:13,930 --> 02:45:16,350
Wouldn't we just have to wait for the
next bar?

2053
02:45:16,590 --> 02:45:22,530
And usually on a bar like this, Doug
would be extremely accurate in stating

2054
02:45:22,530 --> 02:45:27,810
this, because we would be thinking that
this is some kind of momentum type of

2055
02:45:27,810 --> 02:45:30,090
bar, and usually...

2056
02:45:30,380 --> 02:45:34,780
that momentum bar on that type of volume
signature is going to have the increase

2057
02:45:34,780 --> 02:45:37,780
of the supply, and therefore we need
some kind of retest.

2058
02:45:38,100 --> 02:45:43,360
And we want the retest of that type of
action to have specific characteristics.

2059
02:45:43,960 --> 02:45:49,040
We want the spread, which is the down
spread, to diminish.

2060
02:45:49,320 --> 02:45:53,000
We want the supply to diminish as well.

2061
02:45:53,380 --> 02:45:59,460
And we don't want to see any violation
of the open, low,

2062
02:46:00,270 --> 02:46:04,070
And we see it right here. So what does
that suggest, Naresh?

2063
02:46:09,790 --> 02:46:11,590
That violation of the law?

2064
02:46:13,210 --> 02:46:15,090
Right. Sorry, I was on mute.

2065
02:46:15,710 --> 02:46:16,710
Yeah.

2066
02:46:17,150 --> 02:46:21,050
That violation of law suggests that
there

2067
02:46:21,050 --> 02:46:24,710
is no demand.

2068
02:46:27,410 --> 02:46:34,260
Yeah. that the demand that was here on
bar number two that is hidden

2069
02:46:34,260 --> 02:46:39,180
on this volume spike, it's of poor
quality. And we kind of already

2070
02:46:39,180 --> 02:46:43,900
there is some institutional selling
coming in. Then the next day, there is

2071
02:46:43,900 --> 02:46:44,900
continuation.

2072
02:46:45,740 --> 02:46:51,280
So that confirms that whatever supply
has come on bar number two is of

2073
02:46:51,280 --> 02:46:57,420
institutional quality and that we are
just continuing with the same bias.

2074
02:46:57,920 --> 02:47:03,680
on bar number three there are no more
buyers at this point and there are no

2075
02:47:03,680 --> 02:47:10,620
sellers bar number two combined both of
them the sellers

2076
02:47:10,620 --> 02:47:16,500
and the buyers both of the camps and
everything was done on bar number two

2077
02:47:16,500 --> 02:47:20,940
everybody positions themselves and bar
number three is just a test the

2078
02:47:20,940 --> 02:47:26,280
resolution bar that just tells us that
sellers have won so therefore

2079
02:47:27,080 --> 02:47:31,740
as sellers have won now lash where do
you think the bars are going to have

2080
02:47:31,740 --> 02:47:37,640
stop losses stop loss

2081
02:47:37,640 --> 02:47:44,560
i'm going to suggest a couple of places

2082
02:47:44,560 --> 02:47:51,220
how about this one right right below
this flow right below this flow and then

2083
02:47:51,220 --> 02:47:55,000
how about this one right here right
below this flow

2084
02:47:55,760 --> 02:48:01,700
So what's going to happen when the stop
losses are going to

2085
02:48:01,700 --> 02:48:03,140
be hit?

2086
02:48:07,600 --> 02:48:14,060
So we can

2087
02:48:14,060 --> 02:48:20,140
stop, I'm sorry, we can point of entry
that bar.

2088
02:48:22,280 --> 02:48:24,940
And then we can,

2089
02:48:25,710 --> 02:48:26,710
Stop losses.

2090
02:48:27,450 --> 02:48:28,450
Two levels.

2091
02:48:28,650 --> 02:48:33,350
So when the price is going to go
through, that stop loss is going to

2092
02:48:33,350 --> 02:48:35,190
market order and it's going to be
executed.

2093
02:48:35,750 --> 02:48:39,070
And that's going to be a sale.

2094
02:48:39,870 --> 02:48:44,530
Therefore, that's going to increase the
level of supply and the volume signature

2095
02:48:44,530 --> 02:48:45,530
should go up.

2096
02:48:45,970 --> 02:48:48,850
So look at the first stop loss level.

2097
02:48:49,610 --> 02:48:52,190
We definitely see that the volume has
increased.

2098
02:48:53,290 --> 02:48:54,930
And look at the...

2099
02:48:55,450 --> 02:49:00,610
Bar number five, which is the second
level. So this is where the majority of

2100
02:49:00,610 --> 02:49:01,710
stop losses were.

2101
02:49:02,270 --> 02:49:07,890
And that's why the volume signature
increases here on stop losses.

2102
02:49:11,190 --> 02:49:15,150
They're becoming the market orders.
They've been hit, becoming market

2103
02:49:15,390 --> 02:49:17,510
And there is a capitulation by weekends.

2104
02:49:18,730 --> 02:49:22,250
So right away, notice what happens
afterwards.

2105
02:49:23,320 --> 02:49:28,600
Bar number five is that heating up the
stop losses and increasing the volume

2106
02:49:28,600 --> 02:49:32,440
signature. Now, Lash, what does that
suggest for the swing to the downside?

2107
02:49:32,820 --> 02:49:33,820
Continuation?

2108
02:49:34,660 --> 02:49:39,340
Yes. Okay, but bar number five is also
very interesting.

2109
02:49:40,540 --> 02:49:42,440
Let's go through bar number five.

2110
02:49:42,740 --> 02:49:44,660
The volume definitely has increased.

2111
02:49:46,640 --> 02:49:52,300
Do we see an increase in supply just
because the first move was to the

2112
02:49:53,060 --> 02:49:55,660
Yes. So supply has increased.

2113
02:49:55,960 --> 02:49:58,080
Do we see an increase in demand?

2114
02:49:59,340 --> 02:50:00,700
I would say yes.

2115
02:50:01,040 --> 02:50:02,320
Demand has also increased.

2116
02:50:03,020 --> 02:50:04,100
Yeah, absolutely.

2117
02:50:04,700 --> 02:50:06,780
What is dominating as an effort?

2118
02:50:08,060 --> 02:50:09,640
Still supply is dominating.

2119
02:50:09,980 --> 02:50:14,060
Probably supply still is dominating
demand at this point of time.

2120
02:50:14,460 --> 02:50:19,320
Some demand came in. We see this from
the tail, right? So let's quickly go

2121
02:50:19,320 --> 02:50:20,320
through the results.

2122
02:50:20,940 --> 02:50:26,500
So the spread is what? Maybe it's
slightly decreasing

2123
02:50:26,500 --> 02:50:30,920
relative to spread number four or maybe
the same.

2124
02:50:31,940 --> 02:50:35,920
Closed is what?

2125
02:50:37,540 --> 02:50:39,220
Closed is bearish.

2126
02:50:40,320 --> 02:50:43,720
It closes in the upper part of the
spread.

2127
02:50:44,020 --> 02:50:45,080
Look at this whole spread.

2128
02:50:45,770 --> 02:50:49,090
In the context, yes, it's bullish.

2129
02:50:49,390 --> 02:50:54,370
Look at one half, so yes, a bullish
spread, so some counter.

2130
02:50:54,650 --> 02:50:56,130
Okay, close to close.

2131
02:50:57,670 --> 02:50:59,770
Bearish. Bearish, closes below.

2132
02:51:01,230 --> 02:51:04,450
Okay, and then the intention was to
overcome what?

2133
02:51:06,170 --> 02:51:08,250
The support.

2134
02:51:08,780 --> 02:51:13,260
Yeah, some kind of support level. So it
kind of closes right on the support

2135
02:51:13,260 --> 02:51:19,680
level. And if you would take some kind
of cluster from this support, from this

2136
02:51:19,680 --> 02:51:25,440
resistance, we still have not really
closed even into that cluster, right? So

2137
02:51:25,440 --> 02:51:26,440
we're going to say no.

2138
02:51:27,520 --> 02:51:29,360
So that's on the bullish side.

2139
02:51:30,480 --> 02:51:35,480
So a very interesting picture here where
there are some bullish characteristics

2140
02:51:35,480 --> 02:51:37,880
that fail.

2141
02:51:39,600 --> 02:51:45,740
And that is happening on still increased
level of the supply and increased

2142
02:51:45,740 --> 02:51:47,920
volume signature and increased effort.

2143
02:51:48,120 --> 02:51:54,620
So the downward effort has increased a
lot, whereas the downward result

2144
02:51:54,620 --> 02:52:00,740
has suggested some

2145
02:52:00,740 --> 02:52:05,540
buying, but

2146
02:52:07,480 --> 02:52:13,900
basically failed as well because the
intention was to overcome the point of

2147
02:52:13,900 --> 02:52:20,760
commitment, the point of resistance, and
it just closed on the level of the

2148
02:52:20,760 --> 02:52:24,320
resistance. It didn't really close
significantly above that.

2149
02:52:24,620 --> 02:52:29,020
So that still suggests a bearish
picture.

2150
02:52:29,240 --> 02:52:30,240
Am I correct, Naresh?

2151
02:52:30,600 --> 02:52:31,600
Yes.

2152
02:52:32,260 --> 02:52:35,020
And bearish pictures suggest a
continuation.

2153
02:52:37,070 --> 02:52:41,850
of a decline, which we do.

2154
02:52:42,410 --> 02:52:45,310
And then we go into bar number six.

2155
02:52:45,790 --> 02:52:48,490
So let's analyze bar number six.

2156
02:52:49,810 --> 02:52:51,890
Volume. What is volume doing?

2157
02:52:53,490 --> 02:53:00,130
Volume is up, but not less than still
for bar number

2158
02:53:00,130 --> 02:53:06,390
five. Yeah, this is an interesting
picture because bar number two,

2159
02:53:06,920 --> 02:53:13,300
Bar number five and bar number six, all
of them have the same intention.

2160
02:53:13,560 --> 02:53:14,600
What does that mean?

2161
02:53:17,060 --> 02:53:23,260
To get the price down?

2162
02:53:23,820 --> 02:53:25,740
To push the price up, right?

2163
02:53:26,260 --> 02:53:32,880
Push the price up. Yeah, price up. So
the bar number two is the most

2164
02:53:32,880 --> 02:53:34,520
successful out of the three.

2165
02:53:35,800 --> 02:53:38,700
Again, it doesn't overcome the point of
the resistance.

2166
02:53:39,680 --> 02:53:45,980
Bar number five is slightly better on
the commitment. It's almost there, but

2167
02:53:45,980 --> 02:53:46,980
really.

2168
02:53:47,740 --> 02:53:53,840
And then, you know, the volume signature
goes down. And bar number six

2169
02:53:53,840 --> 02:54:00,620
is not really committing above the
resistance that we have

2170
02:54:00,620 --> 02:54:01,660
there either.

2171
02:54:02,020 --> 02:54:04,840
But all three bars have the same
intention.

2172
02:54:05,470 --> 02:54:07,850
They are trying to push the price up.

2173
02:54:08,730 --> 02:54:14,330
Now, for us to understand how demand is
functioning on those three bars, I think

2174
02:54:14,330 --> 02:54:16,710
we need to talk about the supply first.

2175
02:54:17,150 --> 02:54:21,810
So what is happening with the supply
signature from bar number two to bar

2176
02:54:21,810 --> 02:54:23,210
five to bar number six?

2177
02:54:25,150 --> 02:54:27,770
I think supply is decreasing.

2178
02:54:30,010 --> 02:54:31,870
Yeah, supply is decreasing.

2179
02:54:32,840 --> 02:54:35,980
And supply is decreasing on the way
down.

2180
02:54:39,260 --> 02:54:45,080
So as supply decreasing on the way down,
we also see that some demand is

2181
02:54:45,080 --> 02:54:50,120
emerging, right? And we could say that
maybe demand is also decreasing in a

2182
02:54:51,680 --> 02:54:58,200
But yet, let's look at the progress here
that we see. If we would take bar

2183
02:54:58,200 --> 02:55:02,060
number five and bar number six and
compare them.

2184
02:55:03,850 --> 02:55:08,390
So we're comparing number five and
comparing number six.

2185
02:55:10,910 --> 02:55:15,330
So what could we say about,

2186
02:55:15,530 --> 02:55:22,430
let's say, the travel of the price from
the low

2187
02:55:22,430 --> 02:55:23,430
to the close?

2188
02:55:26,110 --> 02:55:29,550
It's above the same, I would say.

2189
02:55:30,170 --> 02:55:32,070
So from the low.

2190
02:55:32,750 --> 02:55:36,190
to the close, it's somewhat the same.

2191
02:55:37,010 --> 02:55:40,510
And yet, so this is the result.

2192
02:55:43,130 --> 02:55:48,510
And yet, what do we see on the

2193
02:55:48,510 --> 02:55:52,630
effort of the demand?

2194
02:55:52,890 --> 02:55:59,070
So we've seen that the demand has
diminished from bond number five to

2195
02:55:59,070 --> 02:56:00,790
six, right? Do we see that, guys?

2196
02:56:01,960 --> 02:56:05,880
We're looking at the volume signature,
and we see that the volume is going

2197
02:56:06,660 --> 02:56:12,240
So that suggests that both supply and
demand are diminishing at the same time.

2198
02:56:12,980 --> 02:56:19,720
Supply is still somewhat dominant, but
demand is going down as

2199
02:56:19,720 --> 02:56:21,500
well, and supply is going down.

2200
02:56:24,240 --> 02:56:28,500
So the distance then...

2201
02:56:28,960 --> 02:56:34,880
that the bar number five and bar number
six travel from the low to the close

2202
02:56:34,880 --> 02:56:35,960
happens

2203
02:56:35,960 --> 02:56:41,980
on

2204
02:56:41,980 --> 02:56:47,500
diminishing effort to the upside.

2205
02:56:48,880 --> 02:56:55,820
So the question is, is this rally from
the low to the close

2206
02:56:55,820 --> 02:57:01,680
on bar number six an easier move to the
upside than on bar number five.

2207
02:57:03,940 --> 02:57:04,940
Yes.

2208
02:57:05,400 --> 02:57:10,060
Do you guys see that? I want some kind
of feedback from all of you guys. Just

2209
02:57:10,060 --> 02:57:12,040
say something. Yes, I see it. Yes.

2210
02:57:12,880 --> 02:57:19,780
So we're talking about the distance from
the low of bar

2211
02:57:19,780 --> 02:57:25,040
number five to the close and then from
the low of bar number six to the close.

2212
02:57:25,930 --> 02:57:31,310
We're saying that from the low to the
close on both bar number 5 and 6, we

2213
02:57:31,310 --> 02:57:32,830
of have this similar result.

2214
02:57:35,030 --> 02:57:40,110
Yet there is a subtle difference in the
way how the volume behaves.

2215
02:57:40,870 --> 02:57:46,530
The volume goes down, which suggests
that both supply goes down and demand

2216
02:57:46,530 --> 02:57:50,890
down. So now we're thinking like, okay,
the same result for bar number 5 and

2217
02:57:50,890 --> 02:57:54,670
then bar number 6, and yet it happens on
diminishing demand signature.

2218
02:57:55,280 --> 02:57:57,220
So it means what?

2219
02:57:57,560 --> 02:58:04,020
It means that it's easier to

2220
02:58:04,020 --> 02:58:07,980
advance the price.

2221
02:58:09,080 --> 02:58:13,600
And if it's easier to advance the price,
we would be thinking about maybe like

2222
02:58:13,600 --> 02:58:20,420
an ease of movement where demand is
diminishing and yet the price is going

2223
02:58:21,620 --> 02:58:24,380
Is it bullish -nullish or bearish?

2224
02:58:26,460 --> 02:58:29,680
Bullish. It's bullish, at least short
term.

2225
02:58:30,800 --> 02:58:35,800
And therefore, we could expect some kind
of rally out of this spot.

2226
02:58:37,140 --> 02:58:42,640
Okay. Well, here's the rally. It's to
the point number seven.

2227
02:58:43,180 --> 02:58:45,940
And I think that we're going to stop
here.

2228
02:58:46,940 --> 02:58:48,800
Sure. Thank you so much.

2229
02:58:50,760 --> 02:58:53,960
I hear a young boy coughing there on the
background.

2230
02:58:54,910 --> 02:58:56,050
We definitely love that.

2231
02:58:58,430 --> 02:59:05,210
Okay, so we've discussed it up to bar
number

2232
02:59:05,210 --> 02:59:06,970
six, swing number three.

2233
02:59:07,730 --> 02:59:14,330
So what I want you guys to do is to kind
of play around with this.

2234
02:59:15,070 --> 02:59:21,570
My general assignment here for you is
just to go through the whole chart and

2235
02:59:21,570 --> 02:59:24,550
just to analyze it, bar by bar, swing by
swing.

2236
02:59:24,860 --> 02:59:26,920
Again, you don't have to do everything.

2237
02:59:27,340 --> 02:59:31,880
Probably in the next class, we're going
to stop somewhere here or maybe here.

2238
02:59:32,120 --> 02:59:38,820
I don't know exactly where we're going
to stop. It all depends on how the class

2239
02:59:38,820 --> 02:59:39,820
is going to unfold.

2240
02:59:40,000 --> 02:59:42,120
So therefore, just go at your own pace.

2241
02:59:42,960 --> 02:59:49,220
Maybe as a point of reference, let's do
everything until point number 25, and

2242
02:59:49,220 --> 02:59:50,220
that would be fair.

2243
02:59:50,360 --> 02:59:52,440
I don't want to overwhelm you as well.

2244
02:59:53,070 --> 02:59:58,030
But I want you to analyze, yes, I want
you to analyze all of these bars, all of

2245
02:59:58,030 --> 02:59:58,909
these swings.

2246
02:59:58,910 --> 03:00:03,510
I want you to think about the market
behavioral analysis. I want you to

2247
03:00:03,510 --> 03:00:09,650
deduct something as to like at bar
number nine, what is happening that

2248
03:00:09,650 --> 03:00:10,650
concludes,

2249
03:00:11,390 --> 03:00:16,570
let's say, this environment and suggest
that we're going to go up. I want to

2250
03:00:16,570 --> 03:00:22,430
hear your reasoning. I want to
understand how your mind thinks on this.

2251
03:00:22,920 --> 03:00:28,560
So, and you will be ready, you know, to
discuss all of this. And it's just going

2252
03:00:28,560 --> 03:00:29,740
to go a little bit faster.

2253
03:00:29,960 --> 03:00:32,640
You can use this format. Please do so.

2254
03:00:32,900 --> 03:00:38,120
And you could send me, you know,
different slides on, let's say,

2255
03:00:38,300 --> 03:00:39,960
different slings, and so on and so
forth.

2256
03:00:41,220 --> 03:00:45,880
But not necessary. You could just show
me what you...

2257
03:00:47,750 --> 03:00:53,970
in any other different ways that you
want to show how you analyze all of the

2258
03:00:53,970 --> 03:00:58,570
bars and all of the swings, I would
definitely accept that. I'm just giving

2259
03:00:58,570 --> 03:01:00,830
maybe an example of how you could do
that.

2260
03:01:01,430 --> 03:01:05,370
All right, and this is going to be the
exercise for the next five sessions or

2261
03:01:05,370 --> 03:01:06,370
so.

2262
03:01:06,930 --> 03:01:10,910
Again, this is a very important
exercise. We didn't have a lot of time

2263
03:01:11,110 --> 03:01:16,510
but even those 30 minutes for this
exercise, please listen to this again.

2264
03:01:17,020 --> 03:01:19,100
Make your notes. Send those to me.

2265
03:01:19,340 --> 03:01:22,960
So quite a few homework assignments.

2266
03:01:23,280 --> 03:01:28,920
Again, I'm not insisting on everybody
going through their homework.

2267
03:01:29,160 --> 03:01:35,900
So just do it at your own pace and
prioritize. I would say that the

2268
03:01:35,900 --> 03:01:37,080
this exercise, obviously.

2269
03:01:37,440 --> 03:01:42,400
But if you have time to do the volume
and spread exercise, do that as well.

2270
03:01:42,740 --> 03:01:43,740
All right, guys.

2271
03:01:44,940 --> 03:01:46,840
Good class, a lot of material today.

2272
03:01:47,640 --> 03:01:51,720
I'm glad that we are kind of like
getting on with this exercise.

2273
03:01:52,780 --> 03:01:57,340
Sorry and apologies that I was not
feeling that well today.

2274
03:01:58,860 --> 03:02:03,060
I think I'm feeling better now by the
end of the class, surprisingly.

2275
03:02:04,140 --> 03:02:09,280
So I'll see you all next week and, you
know, have fun with the homework.

2276
03:02:09,680 --> 03:02:11,940
Thank you, guys, and bye -bye.