Amigos and All, for anyone interested in P&F charting here is a little background on it. This is basically all I know if you would like additional information Im sure you can go to the P&F thread and they would be glad to help you. It is interesting.
Point and figure charts differ from "normal" price charts in that they completely disregard the passage of time and only chart changes in price. Rather than having price on the y-axis and time on the x-axis, P&F charts display price changes on both axes.
The Parameters for P&F charts are
Box Size
Reversal Amount
Price Field
P&F charts display an X when prices rise by the box size and display an O when prices fall by the box size. Note that no Xs or Os are drawn if prices rise or fall by an amount that is less than the box size.
Each column can contain either Xs or Os, but never both. In order to change columns (e.g.,from an X to an O column), prices must reverse by the reversal amount multiplied by the box size. For example, if the box size is 3 points and the reversal amount is 2 boxes, the price must reverse direction 6points(3 times 2) in order to change columns.
If you are in a column of Xs, the price must fall 6 points in order to change to a column of Os. If your in a column of Os, the price must rise 6 points in order to change to a column of Xs. The changing of columns signifies a change in the trend of prices.
Becuse prices must reverse direction by the reversal amount, each column in a P&F chart will have at least reversal amount boxes.
P&F charts are designed to display the underlying supply and demand of a security. A column of Xs shows that demand is exceeding supply. A column of Os shows that supply is exceeding demand and a series of short columns shows that supply and demand are relatively equal.
There are several chart patterns that appear repeatedly in P&F charts. These include Double Tops andBottoms, Bullish and Bearish Signal formations,Bullish and Bearish Symmetrical Triangles, Triple Tops and Bottoms, etc.
Joe
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