Making of a method
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I don't have much faith in extrapolating S/R dynamics over 10 years.
Over the short term, it makes sense how S/R represents those levels of price where traders repeatedly bought or sold, thereby allowing for the anticipation of behavior.
However, I don't see how this same dynamic would extend 2 years out, much less 5 or 10. After all, how many institutional investors hold through multiple years?
There seems to be diminishing value in using auction market principles the further out you go in time.
But this is just an opinion based on my understanding of principles. I have not actually observed long term behavior through PA.
will continue this at another time, the point i was going to make is the 6 month chart showing the break above the tl in the 97 til now chart and the recent move in naz, both charts leave a lot of holes if you are looking for a standard bell curve, they left a lot of areas to be filled in to become standard, the widest ones marked are where price spent the most time so the largest amount of remaining shorts or longs, half of all those trades are at those points, so your auction comment can be assisted with paint by number spots where the players have enough orders to stall a move as the market searches down for buyers and up for sellers,once it has extended as in nq reaching to a tl res line ,you can work the backtrack ,fill in with a supp res bounce drop,hold, continue...just planting some ideas, this works the same on a one day chart,learn that and then apply it to multi day charts, then trade the larger and smaller pics together,keep with the trendline and bar studies,just wanted to point out the importance of a bigger garden to plant in your head,you seem sharper and don't want you spinning your wheels
I agree. I am curious though, do you see my current prep work, where longer term trend and S/R levels are used to create context for the upcoming day as different from what you have been saying?
I feel that either you are graciously pointing me to something that I am already doing or that I am clearly not getting what you are saying.
i am seeing your prep and find your logic very limited in scope,to be fair i am prejudiced against daytrading.or scalping,25 years ago it was a cakewalk,today its a minefield,and folks are getting led to slaughter on an hourly basis, hft's are just raping daytraders, just trying to prevent you from buying swampland, sorry if you're offended, i don't care if you are,i am just some handle on a blog, if the end results in you not getting taken ,was worth it..bottom line, get a lot more knowledge before believing in profits
The first sounds like something you read somewhere. But even if you came up with it on your own, understand that there is no such thing as "herd behavior" or "herding". There is only the aggregate behavior of every market participant. To characterize it as "herding" is to view it as stupid or mindless, and while many market participants -- including many professionals -- are stupid and mindless, thinking of them as such is not productive and can lead one into making unwise choices.
As to HFT and quants, I wouldn't be concerned about it. Trading now, particularly in terms of bubbles, is no different from what it was in '99, unless one is scalping. And what you're doing is not scalping. What you ARE doing is going through a process, not "spinning your wheels", which may not be clear to someone who hasn't followed it since April.
FT Day 14 Sept 12
R: 3189 (Multiple tested high from 10th)
R: 3183 (mp of congestion from 10th. Very high VAP)
R: 3172 (SH from PM)
R: 3167 (Multiple tested prior S level from 9th. Recently tested PM. Also is mp zone of upwave from 46 t 89. High VAP)
S: 3162/3160 (congestion on the 9th and SL. Med VAP)
S: 3157 (Prior tested R from 9th) Low VAP
S: 3151 (mp of hinge from 9th. Low VAP.
Story 1: LOLR since the rejection of 89 at Tuesday's close has been steadily down. Price breaks below the important 67 level and the uptrend starting from 46 is signaled as being over. Selling takes price to test S zones of 51.
Story 2: Buyers use the opportunity to buy here and an attempt is made to push through the congestion from Tuesday. 83 is tested as R.
Review:
A lot of mistakes today. I was too eager for a trade and this led to being too early on almost all trades, leading to terrible whipsaw. Using DS lines to judge pace would have prevented this.
I have to stop taking Reversal trades off S/R just because price is near a boundary level. The method is based on going with the LOLR off S/R. Pace is a big part of LOLR and I totally ignored it today because of the eagerness to take a trade and recoup the losses.
http://www.sierrachart.com/image.php?l=1378910320957.png
R: 3189 (Multiple tested high from 10th)
R: 3183 (mp of congestion from 10th. Very high VAP)
R: 3172 (SH from PM)
R: 3167 (Multiple tested prior S level from 9th. Recently tested PM. Also is mp zone of upwave from 46 t 89. High VAP)
S: 3162/3160 (congestion on the 9th and SL. Med VAP)
S: 3157 (Prior tested R from 9th) Low VAP
S: 3151 (mp of hinge from 9th. Low VAP.
Story 1: LOLR since the rejection of 89 at Tuesday's close has been steadily down. Price breaks below the important 67 level and the uptrend starting from 46 is signaled as being over. Selling takes price to test S zones of 51.
Story 2: Buyers use the opportunity to buy here and an attempt is made to push through the congestion from Tuesday. 83 is tested as R.
Review:
A lot of mistakes today. I was too eager for a trade and this led to being too early on almost all trades, leading to terrible whipsaw. Using DS lines to judge pace would have prevented this.
I have to stop taking Reversal trades off S/R just because price is near a boundary level. The method is based on going with the LOLR off S/R. Pace is a big part of LOLR and I totally ignored it today because of the eagerness to take a trade and recoup the losses.
http://www.sierrachart.com/image.php?l=1378910320957.png