Simplicity in TA

The Dow weekly finished the wedge with a Box Break Down which usually has potency. We are only 2.5 hrs into the daily session on day 1 of the weekly candle and it is how the week finishes that is the confirmation.

The support is obvious and the whole picture is squeaky bottom time for the longs.
 

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So looking at price, it pulls back into the max level for a reversal (unless we are looking at a total retrace).

It shows the clear expected ABC pattern on the weekly.

We have non confirmation of the highs.

Now let's look at linear time cycles. What I do personally with cycles is complex and is not linear, but linear cycles have their place so when we see a clear one, it always pays to investigate to see if there are a cluster of signals.

April is a clear 12mth cycle and we are acting as if we are in the grip of this cycle once again.

It is early in the month to be reading too much into the candle but it is worthy of note that it's 2 yrs since we have had a bear engulfer and so far at this early stage this body is bigger that all but one of the prior 6 green monthly candles.

As we are attacking the prior monthly high now we need to be alert for support on the lower time frames. So far this is performing as expected and a close below this level has all the hallmarks of a major top.

Failure to find support on the lower time frames will mean the 2-Day cycle that I predicted would top the market is so strong it is rolling the weekly cycle. If this happens - look out below.

I will see if I have confirmation on the weekly cycle at the weekend as it is not as simple as a break of support.
 

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Quote from Xspurt:

On the monthly chart we have what I use as a maximum pull back. This set up works on the 1 min chart as easily as the monthly chart.
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Hey X,

Do you mean the recent move down to 6500 and pulling back up to 13000 is the maximum pullback?

Could you elaborate on this a little? I'm not seeing exactly what you mean. Where is the max pullback? And what is it based on? What is the set up exactly, is what I'm asking.

thanks for any clarification and for all the new charts as well
 
Yes the white arrow to the right and the horizontal resistance is the target for the pull back from the 6500 lows based on the PA structure to the left at the 2 arrows close to each other.

Glad you enjoy the charts :)
 
X, could you give an opinion on this line? It's a 5-min ES chart.

Price gave a backtest of it and headed lower. But just because the line "worked" doesn't mean it's sound technique, it may only be due to coincidence. Would you consider that line a valid structure?

Thanks
 

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Quote from dv4632:

X, could you give an opinion on this line? It's a 5-min ES chart.

Price gave a backtest of it and headed lower. But just because the line "worked" doesn't mean it's sound technique, it may only be due to coincidence. Would you consider that line a valid structure?

Thanks
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Hi dv, yes it is a valid minor structure. I'd only be using this if I opened my charts and was presented with this as you should already be in the trade.

It's best to look for clusters of signals and in this case the break of the minor horizontal is confirming.
 
Thanks,

I was already short as I should have been, but took profit impulsively and so needing a place to re-enter I used the entry shown in my post. Just was wondering if it was ok.

Sadly I churned away most of my morning gains trying to snag the reversal off the lows which never happened. :) What can I say it's a work in progress and while it may not always be pretty, I have been closing out each week in the black.
 
SWING PERFECTION

Part of my purpose in this thread is to demonstrate how TA not only works to give quality signals but that it predicts the future. The prediction part is used to prepare for the signal so that when it appears rather than reacting to a new event traders can respond to something they were expecting to see.

This can be mapped out intraday just as I have mapped it out on various longer time frames here. On the attached chart the pink arrow was where I said I was going short and very bearish. It looks obvious now but TA also predicted a sideways move giving long and short trades and using the FTSE it was easy to pick up the exact completion of the move.

The 2-day cycle suggested the move up after the arrow would be followed by a major swing top and all of this was called in advance.

Looking left we can see we now have a minor penetration of the support and if this fails we have 400+ points to the next support. Friday's close will be interesting as we already have aggressive weekly traders in the short.

TA works... if you know what you are doing.
 

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