It is my belief that just about anyone, with time and practice, can develop peripheral awareness in the market. Observing uptrends and downtrends that may be viewed within larger time compressions as trends will reveal S90/Crossovers, just as vertical trading ranges will. The illustrations in this chapter offer a few different views of how Fibonacci levels may be observed, as well as trading ranges or trends within trends.
Figure 8.1 is a view of trends within trends. This main trend is an uptrend. Within this, there are smaller downtrends. Trends within trends can happen on any time compression and any chart: The market has to go down to go up and vice versa.
A weekly candlestick chart has 2,016 five-minute candles that have been moving in uptrend and downtrend patterns for a week before a weekly candle has had time to mature. Let's assume that white candles are bullish and dark candles are bearish:
On a five-minute time compression, if the bulls were in power during a week, then more white candles will be present, and the one weekly candle that will appear at the end of the week as a summary of the historical trading that has been completed for the week will be a white candle, representing that there were more buyers in the market than sellers during the previous week.
If more dark candles are present on the five-minute chart than white candles during a given week, then bears were in control, and the one weekly candle ...