Ifmyante Compression
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Intro Credits and resources
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Please remember that the charts and the concepts presented here are just a quick introdution to Price Action. You You can consider all this as a brie introduction to a bigger story, a story that we know as Price Action. I you wonna learn more about Compression, about Price Action, visit the Red Red Empire Empire threads on Forexactory. Price is everything
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Romancing the price
and pay attention to this great resource: A NEW USEFUL SITE FOR TRADERS TRADERS WHIT A COMPLETE COMPLETE TRADING COURSE COURSE FROM IFMYANTE NOE: All the credit goes to I�������, R��, H����������, ����, ����, and the other great people w ho have contributed; on the other hand, all errors are mine, so ell ree to pm me on Forexactory i you find mistakes, bugs, or i you have suggestions or ideas. ��������
Abbreviation
A - as a prefix - Ascending AA- Adam and Adam ACH - Ascending Channel AE - Adam and Eve AWG - Ascending wedge BE - Break even BE - As a prefix - Bearish, example: BEACH - Bearish ascending channel BEB - Bearish engulfing outside bar BEFL - Bearflag BH - Bar highs BNR - Bump and run BO - Breakout BOPA - Breakout, pullback and advance BOPB - Breakout + pullback BR - as a prefix - Broadening BRN - Big round number BU - As a prefix - Bullish BUB - Bullish engulfing outside bar BUFL - Bullflag CH - Channel CN - Continuation CP CP - Compression CWH - Cup with handle D - Demand DBB - Double Bottom
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DBD - Drop base drop, descending pole flag pole DBR - Drop base rally DBHLC - Double Bar high lower close DBLHC - Double Bar low higher close DB - Double top D1 - Daily DD - Drawdown DM - Diamond DIV - Divergence DS - Daily supply DS - as a prefix- descending DSCH - Descending channel DSWG - Descending wedge DL - Demand trend line EA - Eve and Adam EE - Eve and Eve EX - Exhaustion FL - Flag / Consolidation FO - Fakeout FA - First trouble area FB - First time back. Followed by 2B, 3B etc. HB - Horn Bottoms HNS - Head and shoulders H - Horn tops HF - Higher timerame HFL - High and tight flag (ama-
zing results!) IB - Inside bar Ib4 - Inside 4 bar that is the smallest bar o the previous 3 bars ILR - Island reversal INV - Inverted LIL - Long island LF - Lower timerame M1 - 1 minute M2 and so on MMD - Measured move down MMU - Measured move up MN - Monthly PA - Price action PB - Pin bar PFP - Pole, flag, pole PIE - Price Is Everything thread PPZ - Price pivot zone RN - Round number RBD - Rally base drop RBR - Rally base rally, ascending pole flag pole R - Retrace/Retracement RP - Romancing the Price thread RV - Reversal S - Supply Shampoo - see HNS SL - Stoploss SR - Support/resistance Support/resistance
SRF - SR Flip SL - Supply trend line G - arget L - rend line P - ake profit PP - ake partial profit R - riangle - ouch trade WB - weezer bottoms W - weezer tops W1 - Weekly WD - Weekly Demand WG - Wedge
Ante Party*
o understand exactly a scenario, or indeed to read any situation at all on the charts, past present or uture,you should look or a certain set o clues. HF. Know where price is coming rom and going to, and the PA past and present in all the Fs, rom the Monthly down. General : HF. Specific: At the zones you want to trade, look to Past : study the zone in al l Fs, down to M1 ask yoursel •
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Where were the decisions made? C lean S/D? Mark these li nes. No clean S/D? - compressed zone Did price really shoot away orm the zone, or did it CP CP away? away? Did the zone itsel react at the right place? Look beyond the zone urther into the past. S ee what it reacted to. Was Was there a better S/D nearby that price wants to visit? Tis explains many akeouts.
Present: Approach. Approach. How is price returning to the zone? Where's the nearest flag in th e F you want to trade? Tis is your tg1 in this F. F. Flags in the LFs? What does PA PA tell you? Has price tested the last flag on approach? (good sign) Has price compressed into the zone in this F or LFs? (good sign) Is there big news on the way? Has there just been big news?
LF, does price react violently to the first decision point? Does it quickly engul the ne arest S/D? (good sign) Reaction: In LF, Does price simply CP CP away? away? Maybe it wants to go to the ne xt decision point I the first decision point breaks, watch the signs on approach to the next, and, o course, reaction.
* Past, Approach, Reaction, Tank You!
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Compression denition
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by Ifmyante
We talk about compression compression when when price taking out last decision point and the orders that where lef there.
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Compression charts
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Compression an explanation
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by Red*
Lets put an end to whats compression ( otherwise known as a finishing triangle ) and what not compression. Noticed some conusing comments and charts lately with regards to compression. So, So, below is an entr y rom the past to clearly ide ntiy the PA Firstly, Firstly, we look lef and notice a supply zone - supply zone identied simply by noticing prices ell hard rom there beore, thereore sellers exceed buyers. Now we wait or PRICE ARRIVAL
* As i know, Red Red was was the first who have talked about CP, so all the credits goes to him . Ten, why don’t put his charts firstly ? Because his audience on PIE was generally skilled, he was talking to expert t raders, that don’t don’t need so much explanations. On the other hands, the charts o Imyante and the charts presented here are more “noob” “noob” proo, so study on them beore all. In detail, seems that the “spiking” is the most complicated part o the story or inexperienced trader. “Where the hell are the spikes ? I don’t see any spikes on your chart” was my first question to Imyante; well, remember that you have to understand the dynamics o price in LF that produces the spikes spikes on the HF, HF, and never ever orget that candles are are just a repre-
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.......... ok, now price arrival to zone. But notice the manner in which it approaches - its spiking south WHILS RISING .......... what does this mean? Rising to find supply, spiking spiking south is doing several things @ the same time. Prices are finding small pockets o demand and testing them to r ise to supply. supply. So, as its spiking south its also consuming those small pockets o demand thereore the path south is begin cleared o demand @ the same time!
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PA watch watch and entry, ok now look @ the result. Notice how the bears that dropped through the compressed zone are large and clean suggesting no demand or resistance, reason? - the demand was already consumed by the SPIKING SOUH ON APPROACH O SUPPLY SUPPLY ZONE ............. this is why l have stated ofen - PRICES HINK AHEAD OF IME, prices already decided to turn be cause prices cleared the zone o demand by spiking south beore they reached supply clearing the path south or the bears........... so there it is.
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another example - some o you have been conusing flags or compression. Why does a BULLFLAG DIP? Its dipping dipping to consume sellers @ a given level, once the sellers have been consumed, the flag is complete and prices can advance - no mystery. Ten prices leave the flag to advance, then once prices reached supply, supply, the approach to the zone there was compression, so l sold it
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Compression a video
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by Ifmyante
A quick video on CP and the importance o finding the Drop Base Rally that creates an SR flip.
Compression study on breackout
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by Tyoon
Price compresses up/down then pulls back rom hitting a resistance/support|sup/dem resistance/support|sup/dem and balances out beore an a dvance in the compressed direction. Te res/sup|sup/dem usually comes rom a higher F.. this would normally make me biased or a reversal.. but when you watch the PA unold you see that actually price wants to carry on.. also keeping in mind o where price came rom. For example, i price has only just lef a 4H demand zone and it hits 30M resistance.. the likely scenario here is that the 4H demand is more powerul and will break the 30M resistance. Tese are some structures that I have ound to have happened in example o this sce nario.
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A note o I�������: I price flags atop a cp zone, nothing is valid 'til the flag breaks, one way or the other.
End [22 May 2012]
