How to spot a ranging market early in its development?
Updated 25th Jan:
Have some vague idea. If market is setting up to be ranging, retracement will be a lot after a rally. (how much is a lot, more than 38% fibo retracement?) This makes it easier to lead to big sideways patterns like triangles or rectangles, with no trending tradability.
In other words, if market is not going to be ranging, after a rally retracement will be minimal, thus setting up for next round of rally? The feel of price movements resemble a snake wriggling up freely, instead of keep revisiting similar price levels. Or is it? To chew.
Updated 29th Jan:
Has this any sense?
Trend Strength = ease or efficiency of price movement?
(relative distance travelled for period T) /
(absolute distance travelled for period T)
Updated 1st Feb:
Contributions from fellow traders -
- price contained within high/low boundaries
- usually occur after a huge climb or huge crash
- compare standard deviation of trending/ranging
Updated 2nd Mar:
No need reinvent wheel, just use MACD/ADX if needed.
Guess what the Trend Strength above looks like? ... MACD.
And if I abs() the relative value what do I get? ... ADX.
Updated 9th Mar:
Anti-ranging not in System Z prototype.
For enhancement in Project B2.
