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The volume of structures.

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Tying in with the previous point, we are
now going to add some more variable to

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00:00:06,140 --> 00:00:06,919
our reasoning.

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Volume. According to the law of cause
and effect, for an effect to occur, a

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cause must first have taken place in
direct proportion to the size of the

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The issue here is how to measure the
size of the cause.

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Wyckoff and his early students used the
point and figure chart to determine this

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aspect of the cause.

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Even today, There are some experienced
Wyckoff traders who continue to trust

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predictive ability of this tool.

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To me, trying to measure the capacity of
said cause using the point -and -figure

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chart seems unsound, as it does not
account for the most important factor

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this issue, which is volume.

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Let's take a step back.

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As we know, volume tells us about the
participation of the agents.

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Thanks to the analysis of both the
traditional vertical volume and the

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horizontal volume profile, we can
identify the level of interest that the

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structures have generated from their
beginning to their completion.

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In essence, the volume traded in each
structure is the cause that will have

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generated the subsequent trend effect.

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This cause, the origin, will greatly
influence the general context of the

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market. In other words, the more volume
that has been generated in a structure,

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the more power and influence it will
have on future price action.

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This seems a much more logical approach
to me.

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So the idea is simple. We are going to
measure the volume traded throughout the

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structure to objectively determine what
the size of its cause is in terms of

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volume. However, even doing this won't
enable us to estimate the effect of said

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cause with certainty.

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That said, it can be useful when
comparing structures, as we saw in the

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point. And why am I going on about this
so much? Well, because you may have

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already realized, the variables of time
and volume do not go hand in hand.

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What do I mean by this?

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You can have two structures that have
consumed exactly the same amount of

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but the volume traded in each of them
may be different.

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Taking the example further, we may see a
structure that has taken a long time to

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develop completely, let's say 100 days,
with a certain volume, let's say 100

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,000 contracts traded.

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Under this principle, it would suggest a
lower capacity than another structure

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that has developed in fewer days, let's
say 50.

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but in which a greater volume of
contracts have been traded, let's say

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Interesting, right?

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The final reasoning is simple. The
volume tells us about the participation.

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If one structure has more volume than
another, it means that there has been

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interest in it and that the effect of
the cause will have greater capacity,

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regardless of the time it took to build.

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00:02:44,240 --> 00:02:47,640
Going back to the previous example, in
this case, yes.

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I would evaluate the possibility that
this structure, although shorter in

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has sufficient capacity to overturn the
accumulation below, reverting the

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control of the market from bullets to
berries. On this last slide, we see a

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example happening at Comico.

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To make the measurement, we are going to
use the measurement tool that we can

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find in the left panel of TradingView.

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We select from the beginning of the
structure to the end and it offers us

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information we are looking for.

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In addition to the number of traded
contracts, it shows us the number of

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and bars it covers.

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As we can see, the accumulation
structure has traded 2 .895 billion

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1 ,806 days, while the current structure
has already traded 2 .428 billion in

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just 518 days.

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The difference in comparative terms is
quite striking.

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The accumulation pattern is very
genuine.

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but we know that anything can happen in
the market at any time.

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We have just observed a sideways
movement that does not meet the

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that we would like to see in
accumulation patterns at the moment,

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decrease in volume during its
development.

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Instead, we have seen a significant
increase in volume, which has remained

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and constant, as well as unusual peaks
in the middle of its development.

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These characteristics are at least worth
taking into account, since if it

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continues to develop in this way, a
distribution cost significant enough to

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overturn the accumulation below and send
the price to lower levels could be

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generated.