Are support and resistance levels predetermined? | Page 28 | Forex Factory

Options

Go to
Permalinks
Print Thread

Similar Threads

Draw line with predetermined pip distance from the origin line 5 replies

Which platforms offer non-predetermined timeframes? 6 replies

Adjusting the colours of bar range indicator at predetermined values 4 replies

Is market action based on predetermined levels? 3 replies

Possible Support and Resistance Levels 1 reply

Attachments: Are support and resistance levels predetermined?
Exit Attachments

Are support and resistance levels predetermined?

  • #541
  • Nov 20, 2013 1:36pm Nov 20, 2013 1:36pm
Quoting tomthepoppop
Hello AEBAB - JMSS59 - HOLLOWHEAD I am new to thread but have read it and want to make sure I understand it. I am referring to DAILY CHART in post #1 - If i understand I wait for price to go above 76 then rebound down and I would enter just below the 76 level with a take profit at the 23 level. SL would be optional and at my discretion. Then i just wait for price to go above 76 or below 23 and rebound in th opposite direction and enter the same way again If i am correct then this is one of the simplest strategies i have ever seen - Please let me...
Hi tomthepoppop

Yes and no. There are several ways these templates can be traded. Bobi has implied you can use some of the templates to give you a direction bias and blend with your own strategies, or you can actually trade the templates.

Bobi has given 1 mt4 template, and presented several ways to use that template (he refers to each way as a template which can be a bit confusing).

Each 'template' has a length and baseline.

Each template has a set of rules - some are the same as other templates, some are slightly different. One that seems to be fairly consistent across most of them is what you a alluding to in your question.

- For a short trade you want price to have come from the 23% area in the upper phase and to have come through the 0% and broken the 76% by a certain number of pips. If it breaks then it should eventually reach 23% (note I say eventually because in the template in the first posts it can take week and give you quite large DD)

- For a long trade you want price to have come from the 76% up through the 100% and break the 38% by x pips - price will then eventually reach the 76%.

You probably want to go through find the rules for each template - they are normally bobi's posts in colour and decide how you want to use them. I have posted a few times how I use the templates together, which give me a bias and which I use for entry and exit, so you should be abel to search them out if it helps to give you an idea.

Hope that's clear.

Steve
  • #542
  • Nov 20, 2013 2:20pm Nov 20, 2013 2:20pm
The Market doesn't have a mind of its own to assume that the levels are predetermined. Since (at least) one of your premises is wrong, the conclusion is likely to be wrong, too. You assume that if the price breaks through the 50% level then it should and must reach either 23% or 76% level. I can assure you that it mustn't reach any of that level because there is not one fail-proof method in trading any given instrument. Your method provides good results solely because it's based on supports & resistances and Fibonacci lines (which also act as support/resistance). Given the large time frame, it's obvious that many of those lines are going to act as strong brakes in price evolution for a certain amount of time, causing small pull-backs or large retracements. But there is absolutely no surety that under major events those 23 and 76 lines won't be broken as if it didn't exist. The "beauty" of hindsight in determining the strength of a Fibo line (or a support/resistance) is that you only see the moments it held, disregarding the same number of times it was broken.
  • #543
  • Nov 20, 2013 2:35pm Nov 20, 2013 2:35pm
Quoting Pollux
The Market doesn't have a mind of its own to assume that the levels are predetermined. Since (at least) one of your premises is wrong, the conclusion is likely to be wrong, too. You assume that if the price breaks through the 50% level then it should and must reach either 23% or 76% level. I can assure you that it mustn't reach any of that level because there is not one fail-proof method in trading any given instrument. Your method provides good results solely because it's based on supports & resistances and Fibonacci lines (which also act as support/resistance)....
Hey Pollux

I understand and to a degree agree with you. What strikes me as interesting is with this system the S/Rs are not set out by viewing the chart and drawing them in - they are set out by the levels at the begining of the year. Fibs (as well as S/Rs are of course a self fulfilling prophecy - but only when marked on a very obvious move, to calculate likely pullback and extension (or break/fake) - but the fibs here are not drawn on any historic moves, they simply break up the phases.

You are right, the market does not have a mind of its own, but there can be a collective will and response that is subconscious. I'm not syaing that this is the case becasue to be honest I don;t fully understand it.

But, and here's the thing - if it is right more times than not (for whatever reason) then it provides an edge, and I'll take that .
  • #544
  • Nov 20, 2013 3:14pm Nov 20, 2013 3:14pm
Quoting hollowhead
{quote} Hi tomthepoppop Yes and no. There are several ways these templates can be traded. Bobi has implied you can use some of the templates to give you a direction bias and blend with your own strategies, or you can actually trade the templates. Bobi has given 1 mt4 template, and presented several ways to use that template (he refers to each way as a template which can be a bit confusing). Each 'template' has a length and baseline. Each template has a set of rules - some are the same as other templates, some are slightly different. One that seems...
Thank you Steve - looks like i have a lot more comprehending to do I really appreciate the reply and i will study it
Tom
  • #545
  • Nov 20, 2013 3:17pm Nov 20, 2013 3:17pm
Quoting Pollux
The Market doesn't have a mind of its own to assume that the levels are predetermined. Since (at least) one of your premises is wrong, the conclusion is likely to be wrong, too. You assume that if the price breaks through the 50% level then it should and must reach either 23% or 76% level. I can assure you that it mustn't reach any of that level because there is not one fail-proof method in trading any given instrument. Your method provides good results solely because it's based on supports & resistances and Fibonacci lines (which also act as support/resistance)....
The market has not memory, but if it makes moves that are measurable and can calculate the levels where the price is more likely to come. In Abonacci system has the utmost importance the baseline calculation to determine price levels.
It is true that the operation of the system, for me, has never been clear and creates confusion, I support much in the volume to when the price reaches certain levels, giving me good results.
We have to think that the decisions in financial markets are always made under uncertainty, never with certainty, and any tool that helps us to reduce uncertainty and increase our chances is welcome to me.
  • #546
  • Nov 20, 2013 5:03pm Nov 20, 2013 5:03pm
Quoting jmss59
The market has not memory
The market does have memory because the market, as I've previously said, is the consequence of participants' actions. And those participants base their actions by taking into account previous major price levels (levels that are seen on the chart, to the left).

Quote
In Abonacci system has the utmost importance the baseline calculation to determine price levels.
The "baseline calculation" could be just a derived form of a more fundamental analysis. You know... ln(e) + sin²(p) + cos²(p) = Sum (½)^n, for n=0→∞, instead of 1+1=2. The baseline calculation of this system takes into account a yearly range of 965 from what I understood. The problem in Forex, at least for EURUSD is that yearly range of this pair is higher than that. In some years it goes over 2200 pips.

Quote
any tool that helps us to reduce uncertainty and increase our chances is welcome to me.

Wealthy initial deposit, low leverage, higher timeframe, lesser trades with higher income per pip correlated with a solid knowledge regarding fundamental data (macroeconomics).
  • #547
  • Nov 21, 2013 1:33am Nov 21, 2013 1:33am
Hi hollowhead. What think you, my analysis is correct?
Attached Image(s) (click to enlarge)
Click to Enlarge Name: 0jda.jpg Size: 482 KB
Click to Enlarge Name: hfa5.jpg Size: 488 KB
  • #548
  • Nov 21, 2013 2:16am Nov 21, 2013 2:16am
This is AUD-USD
Attached Image (click to enlarge)
Click to Enlarge Name: ah0y.jpg Size: 447 KB
  • #549
  • Nov 21, 2013 2:55am Nov 21, 2013 2:55am
Quoting jmss59
Hi hollowhead. What think you, my analysis is correct? {image} {image}
Hi jmss59

When looking at the T5_103F I agree with your analysis. But also remember that this template can (and does) fail - so I probably wouldn't say it 'must' reach the target. When you describe 'trend change' I would want to bear in mind that a trend change on the T5_103 could be a simple pullback on the 980 - I am still bullish on EU and GU (although GU has been in a sideways range for weeks) because of signals on other larger templates, so in general I am looking for bullish signals after pullbacks. That is not to say the trades you highlight are wrong, but I would consider the CT.

I think it is important to have a mid-long term view/bias based on the larger templates to give a bias for trading the 220/103.

Hope that makes sense.


Steve
  • #550
  • Nov 21, 2013 3:18am Nov 21, 2013 3:18am
The AUD-USD, finally reached his goal of 47 pips.
Attached Image (click to enlarge)
Click to Enlarge Name: ntwj.jpg Size: 382 KB
  • #551
  • Nov 21, 2013 3:31am Nov 21, 2013 3:31am
We continue with the template T-103, now with the NZD-USD
Attached Image (click to enlarge)
Click to Enlarge Name: bpjj.jpg Size: 440 KB
  • #552
  • Nov 21, 2013 3:32am Nov 21, 2013 3:32am
Quoting jmss59
The AUD-USD, finally reached his goal of 47 pips. {image}
I think you have the AU baseline wrong - you look like you using 0.94683 - it is actually 1.0249.

Glad it worked out for you.
  • #553
  • Nov 21, 2013 3:33am Nov 21, 2013 3:33am
Quoting hollowhead
{quote} I think you have the AU baseline wrong - you look like you using 0.94683 - it is actually 1.0249. Glad it worked out for you.
Unless you are using your own baselines...
  • #554
  • Nov 21, 2013 3:38am Nov 21, 2013 3:38am
Quoting hollowhead
{quote} Hi jmss59 When looking at the T5_103F I agree with your analysis. But also remember that this template can (and does) fail - so I probably wouldn't say it 'must' reach the target. When you describe 'trend change' I would want to bear in mind that a trend change on the T5_103 could be a simple pullback on the 980 - I am still bullish on EU and GU (although GU has been in a sideways range for weeks) because of signals on other larger templates, so in general I am looking for bullish signals after pullbacks. That is not to say the trades you...
I understand, you're operator medium to long term, I am intraday trader. The movement for me may be a change in trend to yourself is a pullback.
  • #555
  • Nov 21, 2013 3:44am Nov 21, 2013 3:44am
Quoting jmss59
{quote} I understand, you're operator medium to long term, I am intraday trader. The movement for me may be a change in trend to yourself is a pullback.
Actually I try and trade mostly intraday, but using hedging on this system can mean trades do take days - but some last minutes. I generally don't actually trade the large templates - I am just use them to define trend/direction - which for most is obvious anyway (depending how far you zoom out on a chart).

BTW - what do you use to annotate your charts?
  • #556
  • Nov 21, 2013 3:46am Nov 21, 2013 3:46am
Quoting hollowhead
{quote} Unless you are using your own baselines...
I use line-based monthly, to my way of operating need most recent data. I consider it a more annual baseline for medium to long term.
  • #557
  • Nov 21, 2013 3:51am Nov 21, 2013 3:51am
BTW - what do you use to annotate your charts?

http://www.picpick.org/en/
  • #558
  • Nov 21, 2013 3:57am Nov 21, 2013 3:57am
Quoting jmss59
{quote} I use line-based monthly, to my way of operating need most recent data. I consider it a more annual baseline for medium to long term.
Oh ok.
  • #559
  • Nov 21, 2013 3:57am Nov 21, 2013 3:57am
Quoting jmss59
BTW - what do you use to annotate your charts? http://www.picpick.org/en/
I use a Paint X - but I use Macs.
  • #560
  • Nov 21, 2013 4:49am Nov 21, 2013 4:49am
USD-JPY
Attached Image (click to enlarge)
Click to Enlarge Name: vb30.jpg Size: 522 KB
0 traders viewing now