Hello jim, Rightly or wrongly, this is how I understand the...

Hello jim,

Rightly or wrongly, this is how I understand the difference between timeframes, and the influence they have over the future price action.
The larger the timeframe, the stronger or more powerful its influence will have on the future trading.
This is because longer timeframes contain more 'information' (price action and volume).
A single bar (or candlestick) will generally influence one or two bars into the future (three at the most), no matter what the timeframe is.
So for instance, a one minute bar contains very little 'information' and will only influence the price action for one or two minutes into the future, however a weekly bar contains much much more 'information', and will therefore influence the price action for one to two weeks into the future.

So a weekly supportive bar will generally be much stronger if the response to it is positive, but also if it was to fail, the response will also be strongly negative.
Therefore a weekly spring would be considered quite powerful (as it contains a lot of information).......but remember, that springs work best (and are most consistent) in uptrends, after a breakout, or at the end of trading ranges or accumulation zones, and they are much less consistent and sometimes they just fail, in downtrends, after a breakdown, or at the end of potential distribution zones.
Initially it might seem counterintuitive, but little tiny springs are generally much stronger and more consistent, than big fat springs that push down deep below the support line before price recovers.
This is because when support comes in straight away at a certain level, and it is strong enough support to immediately reverse the downtrend, this type of price action shows that strong support is waiting on the sidelines, and the market is seriously interested in defending against a price breakdown.
Whereas, when price is allowed to push deeply below a certain level, before enough support is mustered to close price back at support. It shows that the selling pressure may be very strong, and although enough support may have been found this time around, there is a concern that if very strong selling pressure like that continues, it may become overwhelming in the future, and the potential support may fail altogether, allowing the sellers to gain control.
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Standard Lower Risk Short Entry
Wait for price to clearly break below an important potential support line.
Stay patient, and wait to see if price will make an attempt to recover the lost ground.
Then if so, and price reaches the old support line, but it has now turned to resistance (previous buyers at support are now selling to 'get out' or their positions).
In Wyckoff terminology, this is an upthrust of the potential support line.
Open a short position once the bars suggest that price will confirm the failure to recover the support line, or after it has broken below the pivot when price attempted to turn. Obviously, if price recovers the support line successfully, there is no short entry.
Sometimes price will not even be strong enough to reach the old support line before it begins to fail again, when this is the case open a short when the bars suggest a failure is imminent, or after it break below the pivot where price turned in an attempt to recover the lost ground.
(just make sure there are no important longer term support lines coming through that might reduce the expected downside)



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and just a quick comment on line placement, this is roughly how I do it.
I would put the lower weekly line at 8.12,
and you can see that price is attempting to 'hold on' at this line, but it looks pretty vulnerable.....


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After that I would put in the most recent lines on the daily.....

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Then I would add the important weekly line to the daily chart (and any other weekly lines that appear important), which when added helps to explain why the price was not able to muster enough strength to test (or recover) the 8.21 or the 8.71 pivot lines.

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hope that helps a bit.....

cheers