DislikedIf an indicator is based upon a mathematical formula such as a fib, and historical charts show price reacting at or at least very close to that level a very high percentage of the time, 75% of the time during the last year for example, would you concider this indicator usefull as part of a system?Ignored
DislikedWhat I'm getting at is this. Just because a recent high or low has occured only indicates that either a large number of traders OR a few traders with large positions caused price to reverse. Is it logical to read the minds and motives of other traders without a means of knowing for sure what their intensions are and what actually caused the high or low to happen, or are we fooling ourselves into thinking we can read such cause and effect? Is not history repeating itself, as in the example with a fib, just as logical or even more so in this case?
When price moves up there are more buyers then sellers, demand is higher then supply.. end of story.. There is a reason why people buy at particular levels, but why go into that debate, dont fight price movements, just go with the flow. Trying to combat price movements can only lead to the destruction of one's account.
To avoid getting sucked into the non-warrented price movements, trade only larger time frames.