Please explain what a "TD 13" or "TD 9" is in Chartworks "Precious Metals Show Signs of Life" from May 13, 2015.
A Sequential ‘setup’ occurs when the price closes below the close of four bars earlier for nine consecutive bars. I have found these to be of exceptional value on monthly and weekly charts. (Crude oil generated monthly 9 Buy Setups in March, January 2002, July 1998, January 1994 and February 1985. Prices were 50%, 15%, 37% and 17% higher within six months.)
The second part of the Sequential involves a ‘countdown phase’ once the Setup (9) has occurred. It measures the close versus the low two bars earlier. Each occurrence of Close<=Low counts toward an eventual TD13 count.
The Combo does a similar count after the Sequential 9 Setup, however it starts from the first bar of the Sequential 9 count. It has a number of rules including that each bar in the count must have a close below the previous one in the count. Combos tend to take longer to develop. They require a 13 count to finalize the pattern.
Once any of these ‘signals’ is in place you still need some type of price reversal or ‘flip’ to confirm that the trend reversal is in play.
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