This is the essence of Shannon's approach: using objective, volume-weighted measures across multiple timeframes to understand who is controlling price at any moment and to trade in the direction of that control.
In the PDF, Shannon illustrates how price constantly "seeks" the anchored VWAP. It acts as a magnet. When price is far above it, traders expect a reversion. When price touches it in a healthy trend, it acts as support. This is the essence of Shannon's approach: using
Technical analysis is a method of evaluating securities by analyzing their past price movements and trading volumes. It is based on the idea that market prices reflect all available information and that price patterns and trends repeat themselves over time. Technical analysts use various tools and techniques, such as charts, indicators, and patterns, to identify potential trading opportunities. When price is far above it, traders expect a reversion
Wait for a pullback to a value area (VWAP or moving average) on a low timeframe, then enter when price reclaims that level with volume confirmation. This avoids the costly mistake of buying at the bottom with hope rather than buying higher with confirmation. As Shannon's philosophy states: "Better to buy higher with confirmation than lower with hope." It is based on the idea that market