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PnF base period value

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    PnF base period value

    What does base period type and base period value have to do with anything?

    As I understand it, if I set a box size of 2 ticks, then the following applies:

    1. For every 2 ticks bid in price, a corresponding X is created.
    2. For every 2 ticks offered in price, a corresponding O is created.

    For a reversal to occur and a new column to appear, price has to reverse and close by 2 ticks. As an example:

    Price goes 18,20,22,24. (4 x's on my chart)
    Price goes back down to 22 (a new column is created and an O is printed.)

    Can you please explain how the 'reversal', 'base period type' and 'base period value' fit into this picture?

    Thanks.

    #2
    Hello,

    Thanks for posting.

    The Base Period Type and Value setting will determine the base from where the Point & Figure boxes are build. A base is required in order to start calculating what boxes and columns would be created out of the underlying price action.

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