Hello guys,
The Stuff with 2 day PB and other goes like this.
for us to understand a Pin bar or a 2 Day Pin bar and Whipsaw or Flase breakout or BUOB and BEOB we must understand the following term first.
Rejection
What is Rejection ?
According to my R&D rejection is the price trying to ignore a certain level.
Considering that rejection is the prices ignorance to approach a particular level,what comes into my mind is PPZ,if there is a Strong PPZ or a cluster of PPZ in a tight region there is very likely the price is going to reject that level.
Consider the prices movement described as below, the price is rising risin and finally the price reaches a particular level,and that level is a strong PPZ,now when price hits that level price is supposed to reverse,but sometimes it doesnot,because the orders coupled around that PPZ is scattered in a tightened region rather then exact single line,that is why i say Rejection occurs at PPZ in Clustered form.So when price hits the PPZ and if violates the PPZ even by few ticks it lock in the unwary buyers or sellers above that PPZ,now all those buy oders lead to runawya up to the top but there is a cluster of PPZ so we get a rough ride,in this runaway when cascade of buy orders has ended this forms a long rising price formation which i call a tower.
Next is the fall,i mentioned that there are cluster of PPZ at a place the price finally exhausts at one of those PPZ the price starts to fall,now all those buyers are locked in at higher prices,what they will do is cover and we will get momentum in opposite direction.
Other case could be of trendline or a range,here price temporarily bounces above a range and/or trendine locking in some orders leading to a whipsaw.
Why is there a whip saw,because the trendline is very strong and the orders to push the price above/below are not there,that is why we call it exhaustion because buyers/sellers have exhausted themselves and are on wrong side of the move when they will cover the momentum will build in other direction.
So Where is Rejection?
Rejection is term for price behavior around strong Clusters of PPZ ie Confluent areas.when price is wanting to go away from a region because there is no demand or supply above or below that point.
Rejection and Whipsaw and Pinbars and 2 Day Pinbars:
Well all of them have rejection,price breaks above a strong PPZ locks in some orders and the drags itself down to lock those order holders with a loss.
Because in a Market just above a PPZ there are orders placed and which when triggered will lead to the wick of Pin bar.
Same in Whipsaw and Pinbar price break in opposite direction then expected locks in some buyers or sellers then goes in its original direction.
Outside bars and rejection?
Ever thought why outside bars have lower wicks to cover previous bars lower portions, the reason is people got whipsawed to death there people expected break below or motion in there direction, but they were exhausted rejected at that level and the rejection was caused because of buy or sell orders place against there orders price hit that level locked in those buyers or sellers at loss.
I have a proof:
http://img227.imageshack.us/img227/8...outsidebar.gif
http://img708.imageshack.us/img708/2...tsidebardd.gif
I will correct any unclear terms in my post later, thank you J 16.
Regards
Taz
The Stuff with 2 day PB and other goes like this.
for us to understand a Pin bar or a 2 Day Pin bar and Whipsaw or Flase breakout or BUOB and BEOB we must understand the following term first.
Rejection
What is Rejection ?
According to my R&D rejection is the price trying to ignore a certain level.
Considering that rejection is the prices ignorance to approach a particular level,what comes into my mind is PPZ,if there is a Strong PPZ or a cluster of PPZ in a tight region there is very likely the price is going to reject that level.
Consider the prices movement described as below, the price is rising risin and finally the price reaches a particular level,and that level is a strong PPZ,now when price hits that level price is supposed to reverse,but sometimes it doesnot,because the orders coupled around that PPZ is scattered in a tightened region rather then exact single line,that is why i say Rejection occurs at PPZ in Clustered form.So when price hits the PPZ and if violates the PPZ even by few ticks it lock in the unwary buyers or sellers above that PPZ,now all those buy oders lead to runawya up to the top but there is a cluster of PPZ so we get a rough ride,in this runaway when cascade of buy orders has ended this forms a long rising price formation which i call a tower.
Next is the fall,i mentioned that there are cluster of PPZ at a place the price finally exhausts at one of those PPZ the price starts to fall,now all those buyers are locked in at higher prices,what they will do is cover and we will get momentum in opposite direction.
Other case could be of trendline or a range,here price temporarily bounces above a range and/or trendine locking in some orders leading to a whipsaw.
Why is there a whip saw,because the trendline is very strong and the orders to push the price above/below are not there,that is why we call it exhaustion because buyers/sellers have exhausted themselves and are on wrong side of the move when they will cover the momentum will build in other direction.
So Where is Rejection?
Rejection is term for price behavior around strong Clusters of PPZ ie Confluent areas.when price is wanting to go away from a region because there is no demand or supply above or below that point.
Rejection and Whipsaw and Pinbars and 2 Day Pinbars:
Well all of them have rejection,price breaks above a strong PPZ locks in some orders and the drags itself down to lock those order holders with a loss.
Because in a Market just above a PPZ there are orders placed and which when triggered will lead to the wick of Pin bar.
Same in Whipsaw and Pinbar price break in opposite direction then expected locks in some buyers or sellers then goes in its original direction.
Outside bars and rejection?
Ever thought why outside bars have lower wicks to cover previous bars lower portions, the reason is people got whipsawed to death there people expected break below or motion in there direction, but they were exhausted rejected at that level and the rejection was caused because of buy or sell orders place against there orders price hit that level locked in those buyers or sellers at loss.
I have a proof:
http://img227.imageshack.us/img227/8...outsidebar.gif
http://img708.imageshack.us/img708/2...tsidebardd.gif
I will correct any unclear terms in my post later, thank you J 16.
Regards
Taz