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Box 1 of 8 · The 8-Box Field Guide
The Base
Why nothing happening is the whole point
Position 1 · Red
Side A · Leg 1
Mirror: Box 8
Every dealer's cycle starts the exact same way: with a box that looks like nothing is happening.
Small candles. Overlapping bodies. Price going nowhere in particular. If you pulled up the chart at this exact moment and texted me "is this a good entry?" I'd tell you the truth — I have no idea yet, and neither does the market. That's not a bug. That's the whole point of Box 1.
What it actually is
Box 1 — the red box, if you're following the color system — is the reset. (In the existing A/B notation, this is Side A, leg 1 — the opening leg of the cycle.) It's where the previous cycle's move has finished doing whatever it was doing, and price is just ramping up for what it's going to do next. The moving averages are flat. They're not fighting anything, they're not chasing anything, they're just sitting there next to price like they're waiting for the meeting to start.
If you zoom into the candles, you'll usually see one small fake move— a widening of the range forming a small dealer cycle that pokes outside the range and comes back in. Most of the time, nobody profitable is trading Box 1, which is why we just watch it.
Next title
Write more about what is coming.
Why people skip this box (and shouldn't)
Box 1 is boring. It's the box that never gets its own highlight reel.
But if you can't identify Box 1, you will never correctly identify anything that comes after it — because every single position in this system is defined relative to the one before it. You don't know you're in a Box 2 breakout unless you know you just left a Box 1 base. It sets the opening range for the rest of the pattern. Always mark off Box 1 with a channel.
Box 1's inside boxes
Here is what happens inside box 1- the inside boxes.
How to spot it in real time
It is the first box after a close out channel. Previous to the box 1, there will usually be a series of dojis where the previous cycle ended and the new one begins. The first box on on your timeframe will contain a full dealers cycle that looks pretty balanced. If you pay attention, you will start to see which way that cycle leans, either long or short, which will be a clue as to what will happen on the subsequent cycles.
What it means to the rest of the pattern
It creates the initial high and low for the larger cycle. Mark the channel as i-H&L for the larger cycle.
The width of this channel will become the trend spread as the cycle plays out.
(Get an image of each. the 1 hr hl and 4 hr hl.) Be sure to channel this spread to use as the trend boundaries as the Cycle plays out.
More on that- (post link coming soon)
Box 1's mirror partner - Box 8
Box 8 is a mirror to box 1, in that it is the first of the reversal or balance pattern. Pay attention to box 1 in the image below. See how the shape of box 1 is the smaller shape of boxes 1-8? So box 8 is the start of the next cycle and will resemble a smaller version of the larger boxes 1-4. Notice the emas: Box 1 is where it leaves balance and 8 is where it comes back into balance.
How to trade it
You never trade box 1 on your own time frame. However, when you go down a timeframe,new box 1 gets smaller and higher timeframe box 1, is it's own dealer cycle, which starts with a box 1. And so on and so on. The moral of the story is, don't trade box 1. It is the cycle just getting started. Let it play out.
I the image below, is a box 1 on our timeframe and then the lower timeframe dealer's cycle marked out in the colored boxes.
Consider the larger red box. The entry is long in box 7 (dark blue.)
In the same way, look at the lower timeframe box 1, what I will call 1/1 (little red.)
If you were to enter that box, the ideal entry is red (1/1) into orange (1/2), or at the very bottom or box 1/1, and hold until the lime green box (1/4.)
Now, Imagine there is a smaller 1-8 inside of 1/1 (cause there is.) Lets call that smaller dealers cycle, 1/1/1 - 1/1/8.
Now looking back a 1/1. If you were to trade the long position (1/2-1/4), the earliest entry could be at the bottom of 1/1 going into 1/2.
See how that is the same position as box 1/7
So on the smallest cycle, you will find the entry box 1/1/7 that is the long entry on the lower timeframe,
Just how in the larger cycle, the earliest entry is in box 1/7
In this case, you have seen what happens on the lower timeframe, so you can take it on the higher one.
In this case, 1/1/7 went long, so safe to take 1/7 long, for the start of the larger cycle. Hold position for boxes 2 through 4. (Not shown here. Look at top image to recall your position.
The very earliest to enter a trade is box 1/7, and is not the recommended position, but you know, we don't listen. So, if you are able to find the low in box 7, the entry would be at the next confirmation.
Box 8 forms out second leg W, so look for confirmation in box 8.
To Recap: Box 1 is not an ideal entry. The Ideal first entry is in box 2. Earliest signal in 1/7, first confirmation signal in 1/8 and entry in 2.
The takeaway
You're not going to trade Box 1. That's not what it's for. What it's for is orientation — it's the box that tells you "we're at the start of something, pay attention to what comes next."
Red means stop and wait.
Learn to recognize this one, because the alternative is finding out you were in Box 4 only after you've already missed Box 2.
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