Just to extend NR4-2 as per my understanding.. is having NR4 day triggered on 2 days.. one after another.
Logically it is = NR5 .. For ex if we have range distribution is like 119,120,121 and 118 then we got NR4 here. If on next day we get range of 116 then we have NR4 (120,121,118 and 116 ) if we look back 4 days. If we look back 5 days (119,120,121,118 and 116) then we will get NR5.
We could have also got NR5 if with following range sequence (119,95,121,100 and 90), but this is not NR4-2 setup. We could infact get NR7 level of contraction for 1 day and immediate expansion next day.
As per my understanding, NR4 indicates that mkt has been under contraction for 2 days. That means longer the contraction, stronger the expansion.
In comparision to this, NR5 / NR6 / NR7 means 1 days of extreme contraction.
To understand the difference between NR4 / NR4-2 and NR5, you got to look at the time aspect of market behaviour.
Sunil, any thought /comment on my understanding of this variation.
Hope , I have not confused the readers.
Happy Trading