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A Wyckoff Student Notebook

Discussion in 'Trade Journals' started by Onepoint272, Apr 27, 2016.

  1. Bodacious

    Bodacious Active Member

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    NWS------An interesting pattern with this stock. I have my own theories about this charts structure but I don't want to embarrass myself if I'm way off base, I see signals, I think?

    There's resistance at the $14.12 to $14.15 level, after that it looks like it has room to move.

    I don't have intraday but I can adjust the box value. The chart below is a daily, I looked at the weekly too, they are similar, almost mirror images.

    NWS.png
     
  2. Onepoint272

    Onepoint272 Well-Known Member

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    Hey Adam, I took the liberty of adding some lines (yellow) and commonly accepted nomenclature for classic Wyckoff (white) to your weekly chart of HSBC; not sure where you are at in your studies of Wyckoff. Since this is coming from a downtrend there can be preliminary support (PS) so I went ahead and added that. It is useful for identifying an axis line through the TR and for later identifying the Last Point of Support (LPS) or Last Point of Supply (LPSY). If this had been an accumulation TR then you'd see a Last Point of Support (LPS) on the right hand side of the TR at about the same price as the PS. However, this appears to be a re-distribution TR so there should be a Last Point of Supply (LPSY) instead of an LPS. Also, the opposite of a spring is an upthrust (UT), which like a spring, returns to the TR. If you turn the chart upside down, then it would be a spring and bullish too.

    The other possibility to a break down is that the move under the range is a spring, but there is weakness in the background and the volume although lighter than the SC is still a lot of supply. Even if it turns out to be a spring (springs back into the range) the general rule is that springs fail in downtrends. So I think you may be right, it's broken. The best place to go short would have been on confirmation of the UT, at the LPSY, and on the way down to the bottom of the range.

    upload_2019-8-9_22-52-22.png
     
    #782 Onepoint272, Aug 10, 2019
    Last edited: Aug 10, 2019
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  3. Onepoint272

    Onepoint272 Well-Known Member

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    I had a whopper last week on the road, the first in years. Dang, it was pretty good. I don't know if I'm ready for soylent green (Charleton Heston movie from the 70s for the benefit of the younger crowd). :eek:
     
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  4. Onepoint272

    Onepoint272 Well-Known Member

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    Yeah, I'm currently not in, but I'd wait if looking to buy, given the low end close on Friday. Wednesday showed sellers into the close and there hasn't yet been any follow thru to Wednesday morning's strength. But it is holding the highs; it held 26.03 support.

    EDIT: I found the daily volatility difficult to deal with and ended up holding thru some downdrafts. I'm thinking there are easier stocks to trade.

    Daily bars:
    upload_2019-8-9_23-26-24.png
     
    #784 Onepoint272, Aug 10, 2019
    Last edited: Aug 10, 2019
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  5. Onepoint272

    Onepoint272 Well-Known Member

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    I don't use PnF (horizontal) charts for signals. I use bar (vertical) charts for that and to analyze the structure. Once I know the structure then I use PnFs to compute a target. So looking at the NWS weekly bar chart it appears there may be some upthrust action that could eventually send the price back into the trading range (TR)...or...the Last Point of Support was printed, although it seems early, but it could be. However this TR came from a downtrend (weakness) therefore it should need to prove demand (commitment of the heavy hitters) with a sign of strength (SOS), large up bar with heavy volume. This past week's volume doesn't really do it for me but maybe the daily chart shows an SOS. But let's go ahead and do a count on the PnF. We will take the count along the LPS price line back to the selling climax (the purple line).

    NWS - Weekly bars:
    upload_2019-8-9_23-49-23.png

    So using the vertical chart we locate the TR and its components on a P&F chart. Generally I use the Average True Range (ATR) setting first to establish the box size then I switch back to traditional and round the box size to a nice round number. As you can see from the P&F below, there are 9 columns between the LPS and the SC. 9 columns x the box size x the reversal amount equals the expected move. That is added to the LPS price to get the projected price of 19.75.

    25-cent-box by 3-box-reversal P&F using daily data:
    upload_2019-8-10_0-1-35.png
     
    #785 Onepoint272, Aug 10, 2019
    Last edited: Aug 10, 2019
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  6. Onepoint272

    Onepoint272 Well-Known Member

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    The more I look at NVTA the more I agree with you, that it needs to build cause, that there is a TR set-up, and it is headed back down to the AR. That BC to AR to ST action on the 2-hour chart is for sure a change of change of character even for this volatile stock.

    Also, it has that pattern that we all learn, thru the school of hard knocks, to identify as a bad omen, the tall selling-tail bar followed by a failure to retest the high. I've heard it referred to as the dreaded "h" pattern. However, you can find examples where it does not break down and that's why we shy away from "patterns". But also, accepting that it has now set up a TR, then it is in Phase B which is trendless and unpredictable and perhaps one could wait on the sidelines for a spring and/or LPS.

    130 minute (~2 hr) bars:
    upload_2019-8-10_7-38-2.png
     
    #786 Onepoint272, Aug 10, 2019
    Last edited: Aug 10, 2019
  7. Bodacious

    Bodacious Active Member

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    wyck11111.png First off, I thank you for taking the time to go through that chart and explain it. I like to think of myself as a quick study but I have to say that this subject is challenging, I fear it will require much more repetition to achieve enlightenment in Wyckoff theory. To that end, and not to look foolish I submit the following marked up chart for corrections. I used a weekly format, not sure if that is standard?
     
    #787 Bodacious, Aug 10, 2019
    Last edited: Aug 10, 2019
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  8. Onepoint272

    Onepoint272 Well-Known Member

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    Your stock/chart selection is not the best for learning, however I'll make a few comments on it:

    • Your BC is a BC, a buying climax. You started out correctly!
    • What you show as "Distribution" is not, it is an Automatic Reaction to the buying climax, we would label the low reached as "AR"
    • What you show as a UTAD is really the "Secondary Test" of the BC and we'd label the top of that move as the "ST"
    • What you show as "Redistribution" is actually Mark-Down.
    • You got the SC right
    • You show a line as "Re-accumulation" . First of all, re-accumulation occurs throughout a trading range. The trading range is where the Composite Man (CM) operates, and if he is accumulating he is buying at the low of the range and defending the top of the range by selling some off to depress the price and then buying more at the bottom of the range. Throughout the range he is NET buying by this process. Secondly this latest trading range can't be "re-accumulation since it came from a downtrend. It would have to be just straight up accumulation or re-distribution.
    • JAC refers to a Jump Above the Creek, aka Jump Over the Creek, JOC. Perhaps what you have shown is an attempt to identify the creek. The creek though, a concept developed by a Wyckoff protégé` is really a wavy line that follows along the tops of the peaks.
    You should probably watch part 1 of 3 of what I posted earlier starting at about 6:45.

     
  9. Bodacious

    Bodacious Active Member

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  10. Rock Sexton

    Rock Sexton Meat Popsicle

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    Had I just held those shares in the 18's I bought a month or so ago I wouldn't even be having to pay this pullback any mind. That's the real issue here because the profits from that ER were short lived.

    That is the hardest part of managing these PnF/Wyckoff setups. Dip buying is an absolute MUST - even if you're confident in the long term target because you could run into a moody sequence in the market like we're seeing now while holding a high beta name like NVTA. I feel like this has become a "cycle" for me and I have to get it ironed out. For some of these I'm not benefiting from the LT target and then I'm also not maximizing the short profitable bursts either. Just kind of waffling back and forth on my exit. It's kind of a mental purgatory.

    After the NVTA earnings report, the sucker was darn near the 30's and I sat there like "Nah, gonna wait out the long term". Now it's only 100 ticks away from my damn entry.

    EDIT: I think I'm going to start overlaying keltners again. Any entry into these names that are already trending will only be on pullbacks to the weekly center keltner.
     
    #791 Rock Sexton, Aug 12, 2019
    Last edited: Aug 12, 2019
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  11. Onepoint272

    Onepoint272 Well-Known Member

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    I get what your are saying and its akin to something I've been thinking about recently also...about choosing the appropriate time frame based on the stock. NVTA had a beautiful accumulation trading range and looking at a weekly chart it is performing just fine, but the swings are HUGE and maybe it should be played shorter term, as you say, to maximize/protect profits.

    Weekly bars:
    upload_2019-8-12_19-37-24.png
     
  12. Onepoint272

    Onepoint272 Well-Known Member

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    Found this on @bigbear0083 's "Earning Results" thread and I posted there:

    POLA, just above, never heard of them but they beat earnings by 500% and revenues by 32% with positive guidance. It went public in December 2016 opening at 7.55 and went as high as 11.50 in March 2017, but then in April 2017 fell into a trading range between $4 and $7 where it has been asleep till now. The chart looks like it has been quietly accumulated. Thanks for this thread @bigbear0083.

    They reported after the close today and I expect this may show a sign of strength tomorrow confirming Phase C (a change of character from the trendless Phase B to the trending Phase D).

    Weekly Chart:
    upload_2019-8-12_20-11-41.png
     
  13. Rock Sexton

    Rock Sexton Meat Popsicle

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    I fully agree.

    Let me put it this way - in the past two months alone I've had three positions that would've increased my entire portfolio by 12%. At this moment that number is 3.8%. There's nothing wrong with the positions longer term, but the "how long" is unknowable and I'm really not at the point yet where I'm ready to park funds. The entries were not at the quintessential dip opportunities because I've been late to react and as price activity can show (like in NVTA) you're almost always at risk of having your position tested.

    NVTA when it ran to almost 30 in after hours after earnings was basically a 70% gain in 2.5 months. The 20% gap up the next morning obviously was going to induce major profit taking - our PnF measurements be damned. Let's not forget the top down element in all of this since equities are influenced by the indices (along with options and ETF's). Can't be lettin' it all hang out there unless the mood of the market agrees.

    Apologies for whining. Still trying to resolve this riddle called profit taking in lieu of what feels like such a tremendous opportunity with long term PnF measurements/targets.
     
    #794 Rock Sexton, Aug 12, 2019
    Last edited: Aug 12, 2019
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  14. Rock Sexton

    Rock Sexton Meat Popsicle

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    That nice spring/TS in June looks to me like the moment when the CM took control of supply.

    BTW, 2018's most active price by volume was approx $6.85. EDIT: Actually $6.12. Man what the hell is wrong with TradingView these days. Anytime I leave an indicator up (ex. RSI) it'll misrepresent prices.
     
    #795 Rock Sexton, Aug 12, 2019
    Last edited: Aug 12, 2019
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  15. Onepoint272

    Onepoint272 Well-Known Member

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    Based on your active price by volume, that $6 area may prove to be the LPS, but being just very slightly conservative I used 5.50 and get a projection to 21.25. I'm sure it would have to consolidate a number of times before reaching that number, if it does. This could be a flying pig, but I may give POLA a shot but keep the position small since it is not very liquid...and sell into strength.

    25-cent-box by 3-box-reversal:
    upload_2019-8-12_22-5-38.png
     
  16. Onepoint272

    Onepoint272 Well-Known Member

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    This just out from my favorite bear site, Real Vision.
     
  17. Bodacious

    Bodacious Active Member

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    It seems like small volume, but it also seems like small float.
    Polar Power Inc. (POLA)
    Volume: 27,312
    Shares (M): 10.14
    Shares Float (M): 3.42
    Also, the price apparently has receded overnight, as of this writing it is resting at $4.29.

    polaaaaaaaaaaa.png
     
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  18. Jrich

    Jrich Well-Known Member

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    Two ive been watching for an entry for a while now... AZO on a low volume pull back with ~20% upside and a massive buyback program, almost comparable to being its own CM..... and V pulling back on slightly higher volume, but with ~30% upside and only down 5% from its high

    azo aug 14.png v aug 14.png
     
    #799 Jrich, Aug 14, 2019
    Last edited: Aug 14, 2019
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  19. emmett kelly

    emmett kelly Well-Known Member

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    I got on board the GBTC roller coaster going up a while back and got off before the most recent downturn. Do the Wyckoff indicators suggest it is time to purchase another thrilling ride?
     
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