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Saturday, February 13, 2016 3:15:09 PM
AUD/JPY 4 Hour Chart
Hey SG, you mentioned an AUD/JPY trade and I thought I'd put the TDI mapping to a test and see how it looked.
I can see why it tanked on you. What the TDI mapping does for us is break everything down into 5 wave moves within a given channel, whether it be a parallel channel or some type of wedge pattern. Once 5 waves is complete, then price will move into another 5 wave channel.
The key to the channels is the movement from Wave 4 to Wave 5...that's what we target because it produces the biggest moves.
The crash you mentioned took place during a Wave 3 to Wave 4 movement. Many times during a trend, I've found that price won't find a decent bottom until Wave 4 is hit on a secondary channel.
The wedge prior to the current shows the primary downside move. After 5 waves there, we have to wait until Wave 4 in a secondary channel to find a decent entry for the move back up...basically Wave 4 gives us the best possible entry for a feasible bottom.
There's a mathematical relationship that occurs between the movement of Wave 2 to 3 and Wave 4 to 5 in any channel. The minimum relationship is 1:1...in other words, Wave 4 to 5 will move at least as far as the price action did from Waves 2 to 3. More often, we see 1:1.2 and 1:1.5. Basically, Wave 4 to 5 turns out to be the money maker whether we're playing with the larger trend or playing counter trend.
Playing a Wave 4 to Wave 5 on the TDI WITH the larger trend produces much larger movements.
Right now on A/J, it shows we're hitting a Wave 5 peak in a counter trend move. I'd say it's found a near term bottom but the lows need to be retested first so I'd look for a move back down next week.
AJ 4 Hour Chart...
Hey SG, you mentioned an AUD/JPY trade and I thought I'd put the TDI mapping to a test and see how it looked.
I can see why it tanked on you. What the TDI mapping does for us is break everything down into 5 wave moves within a given channel, whether it be a parallel channel or some type of wedge pattern. Once 5 waves is complete, then price will move into another 5 wave channel.
The key to the channels is the movement from Wave 4 to Wave 5...that's what we target because it produces the biggest moves.
The crash you mentioned took place during a Wave 3 to Wave 4 movement. Many times during a trend, I've found that price won't find a decent bottom until Wave 4 is hit on a secondary channel.
The wedge prior to the current shows the primary downside move. After 5 waves there, we have to wait until Wave 4 in a secondary channel to find a decent entry for the move back up...basically Wave 4 gives us the best possible entry for a feasible bottom.
There's a mathematical relationship that occurs between the movement of Wave 2 to 3 and Wave 4 to 5 in any channel. The minimum relationship is 1:1...in other words, Wave 4 to 5 will move at least as far as the price action did from Waves 2 to 3. More often, we see 1:1.2 and 1:1.5. Basically, Wave 4 to 5 turns out to be the money maker whether we're playing with the larger trend or playing counter trend.
Playing a Wave 4 to Wave 5 on the TDI WITH the larger trend produces much larger movements.
Right now on A/J, it shows we're hitting a Wave 5 peak in a counter trend move. I'd say it's found a near term bottom but the lows need to be retested first so I'd look for a move back down next week.
AJ 4 Hour Chart...
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