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> I don't have much history on this chart
> (started new data files),
Howdy Neal,
The above, I assume, refers to the fact that I don't have 135 bars showing
on the chart. Fair enough. I guess the MACD isn't enough.
but it looks
> like only about 4 or 5 thrusting bars , 1/03,
> 1/04, and maybe 9-11.. With consolidation
> along the way it looks weak.
Sounds like I might learn something here.
>
> Not a B&B. With weak thrust
I guess I've assumed that the thrust necessary for declaration of a B&B was
possibly less than that required for a DRPO (though I've often heard mention
of the possibility of playing a DRPO once an associated B&B has been
completed). I do believe the definition of the B&B requires fewer thrust
bars than that of the DRPO.
One of the reasons that I wrongly assumed the thrust here was adequate for a
B&B setup was the appearance of the MACD. What am I missing here? Both
lines are well below zero and the faster one is well separated from the
slower one.
Another reason was the appearance of the "thrust" on the monthly chart of
the Dow Jones Industrial Average from late 1998 to mid 1999. I believe I
recall that the "thrust" on that chart was considered adequate enough for
Joe DiNapoli to announce that the following "DRPO" was most ominous. If I
were to compare the "thrusts" on that chart with that on the daily chart of
DUK, well, I think you get my point.
It could well be that what is necessary for thrust on a daily chart differs
from that which is necessary on a monthly chart. I don't recall reading
that in the book or reading it in any other forum. Edify me if that is the
case.
You've gotten me all excited about this 90% success rate for B&B's.
However, if that is only for specific setups that are only likely to occur
every few years, and require special dispensation not apparent to the
unannointed... :-)
> I would expect a move to .618, very
> probable.
OK. Would you see that as enough information to trade it on that basis,
and, if so, where would your stop and profit target be? I find I learn a
lot more if this sort of thing is pointed out *before* the pattern plays
out.
> If you're looking for how to calculate
> the profit on a Railroad, A=low of 1/12/01
> B=high of 1/12/01, C=low of 1/16/01
I guess that means that you *would* consider that a RRT setup. Is the high
of 1/12/01 considered to be the "B" of the RRT because it is the high of
1/12/01 or because it is *that*, as well as the low of 1/9/01, or both - or
for some other reason?
On that subject, do you feel that there is anything in the book to allow one
to label A,B, and C for this RRT as you have above? I just dug back through
the book again looking for definitive rules and came up short.
What would A,B, and C be if there were no shallow retracement such as on
1/16? I often find no such shallow retracement. If there is a standard
means of determining A,B, an C in these cases, I'm unable to find it in the
book. I understand that the context of any particular RRT as regards to
higher time frames can be a factor, but it strikes me that there should be
specific rules if one is to actually trade the pattern.
How is "R", the point of recognition determined? Especially if one varies
the time frame in an attempt to make the RRT look right, it seems that "R"
is a pretty nebulous concept. But, I've been wrong before. :-)
I anxiously await the answers to all these questions - or at least
clarification for why I'm full of s--- for asking them. :-)
Kevin
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