ES Daily Year-to-date

By Lawrence

Following is a 30-min ES chart squeezed to show what happened so far this year.


First quarter range projected the top in 2nd quarter with its 50% upside range expansion.

Second quarter is almost exactly 200% the range of first quarter range.

Third quarter higher low is simply a test of first quarter low and when that held up well, we have the melt up to first quarter high.

Isn’t that interesting?


  • miniflowtrader November 4, 2010 at 12:55 pm

    Some questions Lawrence.

    1. This is a quarterly chart, so based on STOPD the opening range would be the first month, but the range is drawn from first month high to second month low, why?
    2. For second quarter, the range of the first quarter is used instead of the first months range, this is not mentioned in STOPD, is this something else?

  • Lawrence Chan November 4, 2010 at 3:44 pm

    #1 My bad. That one is a first move projection using 6 weeks highest high and low.
    #2 The immediate cycle completed always turns into the yardstick for the current cycle. It is part of STOPD.

  • Lawrence Chan November 4, 2010 at 3:47 pm

    I happened to show the chart I had been testing on the yearly behaviour thus you see the first 6 week marking. Will explain what I found that makes 1st 6 weeks useful. (More useful for currencies, less for stocks)

  • miniflowtrader November 4, 2010 at 5:27 pm

    So for the second quarter you are using the previous quarters entire range, or initiation phase as your yard stick?

    Based on the examples in the book, I was under the impression that you always used the current cycles initiation phase as a yard stick and the previous cycles entire range as a yard stick. This seems to be different.

  • Lawrence Chan November 4, 2010 at 5:35 pm

    The chart is showing auto price level markings using the 6 weeks range.
    It is using a variation of the initiation phase. i.e. 1st 6 weeks vs. first month

    It is mechanical and no change to the rules.

    What I was doing is to explore if using 1st 4 to 8 weeks of a year would produce better predictive results across all instruments I track.

    • Lawrence Chan November 4, 2010 at 5:39 pm

      The results I got so far is based on 1st 4 weeks and 5 weeks checking across most of the stocks listed in US and all major future contracts. And that does not produce any significant imrpovement over the use of 1st month of the year.

  • miniflowtrader November 4, 2010 at 5:56 pm

    Perhaps using another time frame as an example. Say this week on ES.

    Monday’s High was 1192.75, the low 1173.75.

    50% = 1202.75
    100% = 1211.75

    Should the above values be used as the current weeks targets? I assume yes.

    In addition, we have last weeks Monday High at 1193 the Monday Low was 1181.25.

    We have last weeks weekly high at 1193 and weekly low at 1167.75.

    In terms of expansion for the current week, is last weeks initiation phase meaningful at all to this week, or should we only be concerned with the expansion based on last weeks entire range?

    Using last weeks entire range we have 100% at 1218.25, today’s high is 1218.75 🙂

    • Lawrence Chan November 4, 2010 at 6:05 pm

      Answer to first question – yes.

      For last week 1193 – 1181.25 = 11.75
      Abs exp to downside is 1181.25 – 11.75 = 1169.50
      That was expected to tag once Monday low acted as resistance.

      Last week’s initiation phase is not useful for current week. As human, however, we tend to see things.
      e.g. You will find that often, due to the nature of range expansion in its multiples from the week before, you will see the last week initiation range price levels recur in current week.

      And for the last part, YES – waited for that the whole day!

  • miniflowtrader November 4, 2010 at 6:56 pm

    Ok, perfect. So your responses confirm my interpretation of STOPD and thank you for taking the time to respond. I waited today too =)

    So now taking this and applying to the quarterly chart.

    Since for the above chart, you are using a 6 week initiation phase, shouldn’t the second quarter range coincide with the high/low of the first 6 weeks of the second quarter?

    From what I can see it does not appear to do so, the low for the sixth week was during the crash and this was in the 1056 area.

    The chart shows the second quarter range low as ~ 1110 which seems to be the second quarter high minus the initiation phase from the previous cycle (which you stated is not important to the current cycle at least on the weekly time frame). Is this specific chart programmed to mark its range for the second quarter as the second quarter high minus initiation phase range from the first quarter?

    I apologize if I am beating a dead horse here, but I rarely change things and I am interested in this. I just want to make sure I am looking at things correctly on all timeframes.

    • Lawrence Chan November 4, 2010 at 7:28 pm

      The 2nd quarter marking changed color because it has matched a relative expansion based on initiation range.

      It is automated so that I can conduct my research faster.

      For the record, notice the second quarter high – Jan high is approx. equal to Jan low – second quarter low.

      • miniflowtrader November 4, 2010 at 7:57 pm

        Got it. This one seems to be based on the first 4 weeks of 2Q.

        Perhaps make this chart definition available as a companion guide to STOPD =)

        Again, thanks for taking the time to explain.

      • Lawrence Chan November 4, 2010 at 8:07 pm

        You are welcome.