Inside Outside Evaluation

Let’s add to the difficulty level here.

We do not have the luxury of a market printing a Left Shoulder or even a Head to signal a pending turn.

For instance the recent run up is already 7 days old, and without knowing the Range well enough it’s been hard to say what is happening exactly.

Yes, the broken head was a signal, but who would have guessed that this run could be a long one?

This is why we need to start paying attention to the difference of being inside the range vs being outside.

The first orange circle was the outside. Potential terminal, potential left shoulder.

The green boxes show how far the market dipped below the 50% line when inside the range. Clearly this market had a bid under it all along the way. The larger orange circle I had discussed in the previous article, it too only returned to just about the 40% mark only to be bought again. If you tried to buy a head after the LS suspect NIL++ well, that didn’t happen.

I added a red and a green rectangle around the consolidation weight 9-pips out and they get either filled or left empty showing if price has managed to get away from the recent range by 12 pips or more in either direction.

Would you be surprised to see a buying attempt in the green box below? From now on I wouldn’t be.

while (i<lookback){
   if (taxi[i]!=taxi[0]) break;

      ObjectCreate("Buick", OBJ_RECTANGLE, 0, Time[i], taxi[0], Time[0],  taxi[0]-90*Point);
                      if (iLow(symbol,0,iLowest(symbol,0,MODE_LOW,i,0))>taxi[0]-120*Point) ObjectSet("Buick",OBJPROP_BACK,1);
                      else ObjectSet("Buick",OBJPROP_BACK,0);
      ObjectCreate("Quick", OBJ_RECTANGLE, 0, Time[i], taxi[0], Time[0],  taxi[0]+90*Point);
                      if (iHigh(symbol,0,iHighest(symbol,0,MODE_HIGH,i,0))<taxi[0]+120*Point) ObjectSet("Quick",OBJPROP_BACK,1);
                      else ObjectSet("Quick",OBJPROP_BACK,0);

Since the first peak was a blood diamond, I personally would pass on this buying opportunity.