Fibs don't work

Illini Trader said:
This is a post that I made in the thread "Prove to me that Technical Analysis Works" on Tues Morning July 19th (Post 317). This shows how Fibs can be used when the most important one, the 61.8% retracement is respected numerous times. The context was I was having a little spat with wmwmw as he made a call but refused to say what he was basing his call on. He called my analysis below garbage. Ya'all may thing so as well but I will always believe the Fibs have their place.


I was not expecting this kind of answer especially your last sentence. So I will give the analysis that I expected you to give explaining the TA in this situation. See the chart below. You have a low on June 17 and a peak on June 28. After that you had 5 days that were spike down "pin bar" lows all in the area of the 61.8% Fib retracement of the June 17 low to June 28 high. Thus with the strong move up on Friday the 15th there is a TA expectation that this will support a move higher with a stop below the pin bar lows. That is your "holy grail" although you probably did not throw in the Fib analysis which most people on ET do not find a useful tool.

screenshot-148-png.289642
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Don't you know what you see in the charts? Here's some lines drawn out for you. Channels as they were.
spbs08072022.png


The yellow is the long-term. The red is the medium term. The little Fibo BS is the short term. Where does it look like it is all going to go, considering the time scale?
 
Good analysis O.N. Later on July 19th it did break through your red line of intermediate highs so I thought it would first test the June 28 high which offered no resistance at all. Then test the early June "Event Area" closing high of 4177. And that is where we are right now with 4 days in a row of spiking close to that level without actually getting getting there.

So this is a critical area does it ledge out here then break through to test 4300 or does the resistance hold and start a downward retracement. Todays (Aug 8th) high of 4177.50 is .25 away from the June 2nd closing high. If it does hold. Oboy Oboy, rub hands together in excitement because we can then draw another fib from the June 17 low to today's high or where ever the high is and monitor the fib levels of support. Fibs are not BS, they are real. Just have to learn how to respect them. They are not a holy grail but are a useful tool.
 
Overnight said:
Don't you know what you see in the charts? Here's some lines drawn out for you. Channels as they were.
View attachment 291422

The yellow is the long-term. The red is the medium term. The little Fibo BS is the short term. Where does it look like it is all going to go, considering the time scale?
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In a non-overnight world; wedges are what you have drawn and a subset of channels. Channels are generally defined as parallel, wedges converge. While they both encapsulate PA, they suggest different sentiment of continuation or change due to different market structure.
 
Nobert said:
How can an external factor like a handwritten line on the chart, influence the fundamental basis beneath. It can't.
Or at at least in a perfect world it - cannot.
But this is not a perfect world. Institutions sold the illusion & they know that this is the very first basic stepping stone for any new person, thus,
- the legend goes on.

On the other hand, at the certain times & at the certain timeframes, the fundamental value of the equities, gets reflected by the same lines. No so often tho.

Just thinking out loud.
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You have to question your basic assumption and premise to be able to "See" the market.
 
speedo said:
Fib levels are more effective as projection targets than they are in retracement zones which tend to be more elastic. They are effective as targets not because of sea shells or pyramid construction but because institutional algo's fire at those levels, targets, counter trend HFT algo's etc.. As long as the institutions use them, I use them.
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Always enjoy your posts @speedo, being succinct and articulate are superpowers.
 
Leob said:
Fibs don't work.
MM works.
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Context and knowledgeable application are the things that separates when;
Fibs work
MMs work

and when they don't.

Consider if the above is true or false.
If false, ok you saved some time and possibly money.
If true, then perhaps there is some knowledge out there that can be attained and applied to one's own benefit.

T or F?
All F1 racers are drivers
All drivers are F1 racers
 
Fibs work for me, until they don't
the same as all strategies ,but as long as your agreed stop is in place. all ok

just move on to the next trade.

as you all know, as long as you win lose is in favour so be it.
 
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