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Lesson 2: Part 2: Price Objectives

Price Objectives with different box sizes.
Now that you have the basics down for doing the vertical and horizontal counts adding the different box size calculations will be easier. The box size changes do effect the price objectives of the chart. This is because we are measuring the strength of the move off the bottom and that is measured by the movement in price. So, when the scale changes we must adjust. Sometimes, when a chart crosses over two different box sizes you have to do the calculation twice and add together. Let's start with a table of the calculations.

Bullish Vertical Counts:

Box Size

Formula

Example: We have 10 X's in a column to count. Bottom X is a variable.

Price
Objective
0.25 (X)(3) = (?)(.25) + bottom X = PO (10)(3) = (30)(.25) = 7.5 + 1.25 = 8.75. 8.75
0.50 (X)(3) = (?)(.50) + bottom X = PO (10)(3) = (30)(.50) = 15 + 12.50 = 27.50. 27.50
1.00 (X)(3) = (?)(1) + bottom X = PO (10)(3) = (30)(1) = 30 + 21 = 51. 51
2.00 (X)(3) = (?)(2) + bottom X = PO (10)(3) = (30)(2) = 60 + 102 = 162. 162

Examples:
0.25 Box Size. .50 Box Size 
3.50           X <--10 X's.
3.25           X O
3.00           X O
2.75           X O 
2.50   X       X
2.25   X   X   X
2.00   X O X O X
1.75   X O X O X 
1.50     O   O X
1.25         O X<-Bottom X.
1.00         O
 
17.00           X <--10 X's.
16.50           X O
16.00           X O
15.50           X O 
15.00   X       X
14.50   X   X   X
14.00   X O X O X
13.50   X O X O X 
13.00     O   O X
12.50         O X<-Bottom X.
12.00         O
 
(10)(3) = (30)(.25) = 7.5 + 1.25 = 8.75.
 
(10)(3) = (30)(.50) = 15 + 12.50 = 27.50.
1.00 Box Size 2.0 Box Size 
30           X <--10 X's.
29           X O
28           X O
27           X O 
26   X       X
25   X   X   X
24   X O X O X
23   X O X O X 
22     O   O X
21         O X<-Bottom X.
20         O
 
120           X <--10 X's.
118           X O
116           X O
114           X O 
112   X       X
110   X   X   X
108   X O X O X
106   X O X O X 
104     O   O X
102         O X<-Bottom X.
100         O
 
(10)(3) = (30)(1) = 30 + 21 = 51.
 
(10)(3) = (30)(2) = 60 + 102 = 162.

Bearish Vertical Counts:

Box Size

Formula

Example: We have 5 O's in a column to count. Top O is variable.

Price
Objective
0.25 (O)(2)=(?)(.25) = ? Top O -? = PO (5)(2) = (10)(.25) = 2.5. 5 - 2.5 = 2.5. 2.5
0.50 (O)(2)=(?)(.50) = ? Top O -? = PO (5)(2) = (10)(.50) = 5. 15 -5 = 10. 10.
1.00 (O)(2)=(?)(1) = ? Top O -? = PO (5)(2) = (10)(1) = 10. 50 -10 = 40. 40.
2.00 (O)(2)=(?)(2) = ? Top O -? = PO (5)(2) = (10)(2) = 20. 150 - 20 = 130. 130.

Examples:
0.25 Box Size. .50 Box Size 
5.50          X
5.00      X   X O <-Top O
4.75  X   X O X O X
4.50  X O X O X O X
4.25  X O   O   O X
4.00            O <--5 O's
3.75
3.50
 
15.50          X
15.00      X   X O <-Top O
14.55  X   X O X O X
14.00  X O X O X O X
13.50  X O   O   O X
13.00            O <--5 O's
12.50
12.00
 
(5)(2) = (10)(.25) = 2.5.    5 -2.5 = 2.5.
 
(5)(2) = (10)(.50) = 5    15 - 5 = 10.
1.00 Box Size 2.00 Box Size 
51          X
50      X   X O <-Top O
49  X   X O X O X
48  X O X O X O X
47  X O   O   O X
46            O <--5 O's
45
44
 
152          X
150      X   X O <-Top O
148  X   X O X O X
146  X O X O X O X
144  X O   O   O X
142            O <--5 O's
140
138
 
(5)(2) = (10)(1) = 10    50 -10 = 40.
 
(5)(2) = (10)(2) = 20    150 - 20 = 130.
For Horizontal Counts it is the same thing. You take the box size and put it into the appropriate slot for calculation.

Bullish Horizontal Count.

Box Size

Formula

Example. We have 10 boxes and the bottom of the base is a variable.

Price
Objective
0.25 (boxes)(3) = (?)(.25) + bottom of base = PO  (10)(3) = (30)(.25) = 7.5 + 3.5 = 11. 11
0.50 (boxes)(3) = (?)(.50) + bottom of base = PO  (10)(3) = (30)(.50) = 15 + 15 = 30. 30
1.00 (boxes)(3) = (?)(1) + bottom of base = PO  (10)(3) = (30)(1) = 30 + 35 = 65. 65
2.00 (boxes)(3) = (?)(2) + bottom of base = PO  (10)(3) = (30)(2) = 60 + 102 = 162. 162

Bearish Horizontal Count.

Box Size

Formula

Example. We have 10 boxes and the bottom of the base is a variable.

Price
Objective
0.25 (boxes)(2) = (?)(.25) = ? Top of base -? = PO  (10)(2) = (20)(.25) = 5. 5 - 3.5 = 1.5 1.5
0.50 (boxes)(2) = (?)(.50) = ? Top of base -? = PO  (10)(2) = (20)(.50) = 10. 15 -10 = 5 5
1.00 (boxes)(2) = (?)(1) = ? Top of base -? = PO  (10)(2) = (20)(1) = 20. 30 - 20 = 10 10
2.00 (boxes)(2) = (?)(2) = ? Top of base -? = PO  (10)(2) = (20)(2) = 40. 150 - 40 = 110 110

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