Beyond “Up” and “Down.”
Direction alone does not tell us how the aircraft is flying. Two stocks may both be rising, while one is gaining momentum and the other is beginning to lose it.
First, separate direction from momentum.
Beyond “Up” and “Down”
Learn to recognize the four basic flight patterns.
100 → 101 → 103 → 106 → 110
+1 → +2 → +3 → +4
Rising + Accelerating
100 → 105 → 109 → 112 → 114
+5 → +4 → +3 → +2
Rising + Decelerating
“Going up” and “getting stronger” are not the same thing. After identifying direction, observe whether the size of the movement is expanding or shrinking.
Apply the same idea to falling prices
If declines expand from -1 → -2 → -3 → -4, the pattern is “Falling + Accelerating.” If they shrink from -5 → -4 → -3 → -2, it is “Falling + Decelerating.” But falling and decelerating does not mean the aircraft is rising.
――How is this aircraft flying right now?
Now we understand direction and momentum. That naturally creates the next QUESTION.
What is supporting this flight?
その飛行を支えているものは何だろう？
Add Volume and VWAP to see one level deeper.
Volume
Observe how much market participation accompanies the price movement.
VWAP
Observe where the current price stands relative to the volume-weighted average price up to that point.
Time
Instead of one isolated number, follow the flight record: 9:30 → 10:30 → 14:00 → market close.
9:30 +3.8%／Volume surging／Above VWAP
10:30 +3.1%／Volume declining／Above VWAP
14:00 +2.4%／Declining further／Above VWAP
What we can observe is that “the aircraft remains at a high altitude, but it has decelerated from the morning climb and market participation has declined.” There is no need to force a prediction about the future.
――How is this aircraft flying right now?
But when we add more instruments, a new problem appears.
…Wait. The instruments are telling different stories.
Which instrument is right?
Why are they telling different stories?
What Do We Do When the Instruments Disagree?
Don’t rush to an answer — build a hypothesis.
Instruments are not a voting system. RSI, MACD, VWAP, Volume, and Momentum observe different aspects of the same aircraft.
List only what was actually observed.
Notice what may be beginning to change.
Ask why the pattern looks this way.
Keep more than one possible explanation.
Test the hypotheses with the next data.
Do not jump from one SIGNAL to one answer.
The morning buying wave has run its course and upward momentum is decelerating.
The aircraft is simply resting after a rapid climb while holding a high altitude.
The slowdown is being caused by broader market or sector currents rather than a stock-specific factor.
When new facts appear, update the hypothesis. Being able to verify and revise your thinking is more important than being right on the first try.
――How is this aircraft flying right now?
“I don’t know yet. I’ll wait for the next SIGNAL.” is also a valid analysis.
Three levels of depth were one continuous route.
How is it flying?
Observe direction and momentum.
What is supporting it?
Observe Volume, VWAP, and Time.
Why is it flying that way?
Build hypotheses and verify them with the next data.
We have returned to the same question. What has changed is the depth of what we can see.
So far, we have been watching one aircraft.
But is that aircraft really flying alone?
The surrounding sky has its own “air currents.”
Stop watching only one aircraft — look at the sky around it.
The Chapter 6 link can be connected here when the next chapter is ready.