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S & R Cracked

  • #41
  • May 13, 2007 5:33am May 13, 2007 5:33am
Quoting willf
I personally think that they have little use. They just measure a point in time when price reached a value and reversed and you never know this point until after the event.
Hmm. Perhaps my first statement was a little rash.

Been checking out a daily chart of EURUSD and the support levels would have made great points to go long.

Just never considered it before. Amazing what 8 hours of sleep can do
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  • #42
  • May 13, 2007 5:42am May 13, 2007 5:42am
Quoting willf
Hmm. Perhaps my first statement was a little rash.

Been checking out a daily chart of EURUSD and the support levels would have made great points to go long.

Just never considered it before. Amazing what 8 hours of sleep can do
Aren't those "support" levels painted after the fact? meaning showing the lows for the day?
  • #43
  • May 13, 2007 6:06am May 13, 2007 6:06am
Quoting WTB
Aren't those "support" levels painted after the fact? meaning showing the lows for the day?
You can only know a support level after price has reversed. Otherwise price is still in the same direction.

But here's what I am looking at. Price hits a low and reverses. A new support has been made. Trading off this next bar would have given some good results.

Maybe this is obvious to some. But I just needed to change my perception.
  • #44
  • May 13, 2007 6:45am May 13, 2007 6:45am
Quoting willf
You can only know a support level after price has reversed. Otherwise price is still in the same direction.

But here's what I am looking at. Price hits a low and reverses. A new support has been made. Trading off this next bar would have given some good results.

Maybe this is obvious to some. But I just needed to change my perception.
Myself as well willf. Thanks bemac for bringing this to my attention .
  • #45
  • May 13, 2007 8:09am May 13, 2007 8:09am
Are you thinking supply/demand? Eur/Usd is alive? Do you mean itīs aware of itself?

I read something from a scientists that said when there are 0,618 relationships (Donīt know exactly what it means) the market is aware of itself.
  • #46
  • May 13, 2007 8:43am May 13, 2007 8:43am
Quoting johs
Are you thinking supply/demand? Eur/Usd is alive? Do you mean itīs aware of itself?

I read something from a scientists that said when there are 0,618 relationships (Donīt know exactly what it means) the market is aware of itself.
im pretty sure its support and resistance, but in a way it is related to supply and demand... the .618 is a fib number
  • #47
  • May 13, 2007 8:51am May 13, 2007 8:51am
Yes itīs Fib but he goes into Physics and how sacred geometry is part of universe and such things.
  • #48
  • May 13, 2007 9:20am May 13, 2007 9:20am
Quoting willf
Price hits a low and reverses. A new support has been made. Trading off this next bar would have given some good results.
How do you know price will continue going up in the next bar? just because you have found a temporary low in the intraday action? it doesnt seem quite solid in my opinion.
  • #49
  • May 13, 2007 10:41am May 13, 2007 10:41am
Quoting WTB
Aren't those "support" levels painted after the fact? meaning showing the lows for the day?
Well, I think maybe willf means that the support levels actually align with the previous resistance levels drawn in red. Thus, you could go long when you see price bounce off the previous R level which has now turned to S.
  • #50
  • May 13, 2007 10:43am May 13, 2007 10:43am
Quoting johs
Are you thinking supply/demand? Eur/Usd is alive? Do you mean itīs aware of itself?

I read something from a scientists that said when there are 0,618 relationships (Donīt know exactly what it means) the market is aware of itself.

.618, a fib ratio, is also derived from other areas of mathematics, and is known as the "golden ratio". Read this:

http://en.wikipedia.org/wiki/Golden_ratio
  • #51
  • May 13, 2007 11:05am May 13, 2007 11:05am
S/R, Fib, triangles, head and shoulders, 1-2-3 patterns, flags, pennants and congestion breakouts are infallible in hindsight. Not only can an expert go back on a chart and pick tops and bottoms, but they can also know exactly why a particular formation failed.

The problem with TA is when you try to trade the right hand edge of the chart.

I traded stocks a lot back during the crash of 1987.

I see a constant stream of gurus showing charts of how anyone could have known it was going to happen. A child could have predicted it.
They of course predicted it and all of their clients made money out of it.

I can tell you for a fact that NO ONE was predicting it at the time.
  • #52
  • May 13, 2007 11:15am May 13, 2007 11:15am
Hi JoshDance,

The Golden ratio was used extensively in Classical architecture, which explains its enduring poularity, in fact just look at most modern bank branches, faux Classical facades. Also it has been found that the ratios of facial features are dictated by this number. Those whose faces conform most closely to the Phi ratio are considered the most beatiful, in all races and both genders.
  • #53
  • May 13, 2007 8:49pm May 13, 2007 8:49pm
Quoting Ted1983
Hi JoshDance,

The Golden ratio was used extensively in Classical architecture, which explains its enduring poularity, in fact just look at most modern bank branches, faux Classical facades. Also it has been found that the ratios of facial features are dictated by this number. Those whose faces conform most closely to the Phi ratio are considered the most beatiful, in all races and both genders.

Could we summarize that market tends to watch 0.618 ratio because it naturally wants to look beautiful too ?
  • #54
  • May 13, 2007 10:54pm May 13, 2007 10:54pm
Quoting luqmanz

Could we summarize that market tends to watch 0.618 ratio because it naturally wants to look beautiful too ?
Or maybe because everyone else is using it too?
Mr. Trend
  • #55
  • May 14, 2007 12:07am May 14, 2007 12:07am
i determine s/r from the weekly/monthly. It's basically the black/white candle transition that contains the current price. So above, I look for recent white/black candle transition highs, and below i look for black/white candle transition lows.

basically i assume a ranging (within s/r zone) condition until price really breaks the s/r.
  • #56
  • May 14, 2007 3:34am May 14, 2007 3:34am
http://ermanometry.com/examples/the_...t_triangle.php

Fascinating
  • #57
  • May 15, 2007 10:10pm May 15, 2007 10:10pm
Don't over analyze this Stgy. Please.

Support Defined and Fails = Downward pressuure.

Resistance Defined and Fails = Upward pressuure.

that Simple.

No Second guessing allowed.

You {I} will be wrong ~20% of the time.
That's where Charles' MM becomes a factor.

  • #58
  • May 16, 2007 12:44pm May 16, 2007 12:44pm
Bemac,

Sorry if this is a stupid question but I still don't understand how the horizontal and the angled S&R lines are calculated. Can you please explain it to me in detail?

Many thanks,
Naj
  • #59
  • May 16, 2007 12:52pm May 16, 2007 12:52pm
For the horizontal lines there are two ways I know of, one is drawing lines in areas of consolidation. The other is using a formula. For the formula there are scripts out there that can draw them automatically or calculators that will do the math for you and you just draw the line. There's also a few sites that will do the daily S/R levels and you just have to draw the lines.

Pivot := (High + Low + Close)/3 Or := (High + Low + Current_Open)/3

Resistances:
R1 := 2*Pivot – Low
R2 := Pivot + (High - Low)
R3 := R1 + (High - Low)
R4 := R2 + (High - Low)

Supports:
S1 := 2*Pivot - High
S2 := Pivot - (High - Low)
S3 := S1 - (High - Low)
S4 := S2 - (High - Low)
  • #60
  • Edited 10:42pm May 16, 2007 9:59pm | Edited 10:42pm
Quoting tradewiser
Bemac,

Sorry if this is a stupid question but I still don't understand how the horizontal and the angled S&R lines are calculated. Can you please explain it to me in detail?

Many thanks,
Naj
No Problem,

The Horizontal Lines are the High of the Previous 24 Hour Session & the Low of the Same. {Personally I like to Start a 24 Hour Session @ 6:30AM EST [6:15 on lower TF] and run it to 6:00AM EST}

The Angled [straight lines] are...
1) The Extension of an imaginary line drawn between the High and the Low of the Previous 24 Hour Session. This Extension Starts as the New Session Begins.

2) The Mirror Image of { 1) }which Starts at The Same Staring point as { 1) } ie, the prvious High OR Low
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