I mention calibration at times. Here it is in practice.

You know that I named a five-diamond sequence a failed auction (for now). But I need to weed out some that do not qualify.

For instance, one or two blood diamonds at the end of the sequence are normal. But what if there were 4 in a row?

/CANNIBAL auction up
  if ((RSI2[i]<92.5 && RSI2[i+1]>92.5 && RSI2[i+2]>92.5 && RSI2[i+3]>92.5 && RSI2[i+4]>92.5 && RSI2[i+5]>92.5 && RSI2[i+6]>92.5 && RSI2[i+7]>92.5 && RSI2[i+8]>92.5)
  || (RSI2[i]<85 && RSI2[i+1]>98 && RSI2[i+2]>98 && RSI2[i+3]>98 && RSI2[i+4]>98) 
  ){ 
      ObjectDelete("RayRect"+IntegerToString(i));
      ObjectDelete("RayRecta"+IntegerToString(i));
      ObjectDelete("RayRectb"+IntegerToString(i));
      ObjectCreate("RayRect"+IntegerToString(i),OBJ_RECTANGLE,1, Time[i], 100, Time[i+10], 70);
      ObjectSet("RayRect"+IntegerToString(i),OBJPROP_COLOR,clrRed);
      ObjectSet("RayRect"+IntegerToString(i),OBJPROP_WIDTH,3);
      ObjectSet("RayRect"+IntegerToString(i),OBJPROP_BACK,1);
    
  }  

As the evidence shows, that’s the end of a move, not the start of a trend. Weeding it out by adding the second row to an existing filter.

Regarding an End-Of-Wave sequence, I’d like to propose considering some additional meaning/functions of the main events.

A failed ailuction is 5 to 7 diamonds long, and has to arrive on cue – meaning after a squirt in the other direction.

Now, what if we started looking at this event as a commitment to the new direction?

Until a week ago, if you asked me what a trending market was, I probably would have said that market that is being kept out at the 44 EMA. A strong trend at the 16EMA (all 30 minutes), and an extra strong at the 8 EMA. Yeah, I’m no longer liking that approach. A market that manages to print a failed auction without cannibalising it is a trending market. Most markets, therefore, are healthy, trending markets. The current time is a summer doldrum in the Eur/Usd, not healthy.

There is not enough new money coming in; therefore, you don’t get Failed Auction prints, which are accommodating moves by market makers, giving an open-ended fill, yielding to the new money, the more volume king.

I guess next week I’m gonna talk about the E44-E120 zone for a filter. I started typing this up, but I can’t be bothered now to make the plot.

Things are not obvious from the outset, just because now you have some idea of the components.

For instance, the squirt phase? Does it always happen or can it be waived?

A binary question that raises more questions. Is there a hint, a telltale that can be used reliably?

My current idea, based on the following move up, is that the squirt gets called off if the market manages to close back beyond the E-44 to E-120 hot tub.

Similarly, a pronounced spike beyond this zone may suggest that the squirt would fall shorter than a backtest.

I don’t currently think that a new end-of-wave sequence can be initiated (fresh snake count) with a new failed auction in the same direction that the market has been heading.

The point is that there is working knowledge to be built around these little caveats.

One remark about volume:

When the Medallion fund said that they were not taking any outside money, because then they would be moving the market, what they said was: we figured out how to move the market with the current money that we have, thank you very much. In fact, our problem is keeping the focus of attention off of it. And yes, there may be an algorithm, and it could involve a filter of a number of days of consecutive selling (Markov), but the sensitive part would be the volume necessary, and dosing it right, so that it does not pop out. The Midas touch. Hiring a lot of PHD’s was a sleight of hand.

The pteridophyte doesn’t rustle if the wind isn’t blowing it (Hungarian folk wisdom).

Rodolfo* used to say: watch my hand, because I’m cheating.

I now have 7 trackss above 1k views. Salt and Pepa is gonna be the 8th soon.

Something new?

& below is Dave Gahan making the Basildon accent world famous.

*: Rodolfo was a Hungarian magician with amazing sleight of hand. He used to smuggle in things from behind the Iron Curtain that he put into the customs agent’s pockets for the duration of a search, and then took them back.