Son of If You Can Draw a Straight Line . . .

[redbox]

Quote from dbphoenix:

For those who are interested, these charts will provide a visual to what was posted last Friday. If you haven't printed out those posts, or at least the latter one or two which include the entire sequence, I suggest you do so.

Unless you never opened a chart until last Friday, you know that the monthly is up, the weekly is up, the daily is up, and if you can tell up from down, you know that the hourly is/was up, unless you began trading at midnight, but that's not the focus of this exercise. By 1500 (all times are EST, regardless of what's on the chart), price had reached 3208 (all prices are +/-; this isn't math class). Why did it stop there? Because sellers ran out of buyers. That's all one needs to know. It then dropped to 3176. Why did it stop there? Because sellers weren't willing to sell for anything less. And that's all one needs to know there. If one had been trading this all night, the DLs that bigmoose drew would have been accurate. However, otherwise they are not necessary. Price is/was nonetheless rising. Or had been.

Which brings us to this hinge that so many have drawn. The "hinge" is not really a part of this. Nonetheless, this is not a hinge since it is not "filled with price". This is a range from 3208 to 3176 that resolves itself into a trading range between 3192 (the mean of the range) and 3203 (note how the last bar rejected the bottom reached by the bar five bars previous). It is not crucial that price hold above 3192. But the fact that it has by the time one has opened up the chart is informative. The Dog That Didn't Bark. It has not fallen by now, so . . .

The only line that matters, then, and the only one that matters with regard to the open, is the following:

You then have to determine exactly what it is you're going to look for when the market opens in a few minutes. How is what you have right in front of you going to help you make a trading decision?

Isn't that a midpoint though, and we avoid trading at midpoints?
Extremes are where we look for trades?

 

[dbphoenix]

Quote from redbox:

Isn't that a midpoint though, and we avoid trading at midpoints?
Extremes are where we look for trades?

Please read what has been posted since Friday morning.

 

[redbox]

Quote from dbphoenix:

Please read what has been posted since Friday morning.

OK got it, were just sticking to lines for now.

 

[Hooti]

Quote from dbphoenix:

You then have to determine exactly what it is you're going to look for when the market opens in a few minutes. How is what you have right in front of you going to help you make a trading decision?

Either it will break down thru the line, or bounce off?

Like many, I keep working at (or letting go of) complicating things. I had other lines, but not your 'dog didn't bark' one. Delight to see it tho, once you point it out and why.

 

[MadeMan]

Quote from MadeMan:

wait till , price decides wich way it wants to go



afk , till tomorrow

DB please tell me the difference bewteen my DL and your DL
in your very first post .

http://elitetrader.com/vb/showthread.php?threadid=278341

Pic. 3

also why should i draw in demandlines wich are of no meaning
anymore ? ie. broken/obsolete ? .. anyone can see that the
momentum tappert off , based on. DL breaks.. (advance slows
down) and that price is pausing at this level , wich means the
only thing one should do is wait till this small range is cleared .

why i kept the DL is simple to judge how far the pause will go and
if the market gets weaker at this level , where again a DL break
just tells that story.. ie how /if thepace of an advance slackens..
and finally a shift from demand to supply emerges or not

ty

 

[niko]

Quote from dbphoenix:

The only line that matters, then, and the only one that matters with regard to the open, is the following:

Why? Is it because it is the one closest to price at the time of the analysis?

 

[slugar]

To me the only thing to look for at the open were longs simply because since 5:00 cst there were a series of higher highs and higher lows

 

[slugar]

Quote from niko:

Why? Is it because it is the one closest to price at the time of the analysis?

I believe this level is important because resistance has now become support

 

[llIHeroic]

Quote from slugar:

I believe this level is important because resistance has now become support

Where in this chart has 3192 offered any sort of resistance [?]

--

I am also interested in people's thoughts about niko's question. I feel like I am making a stab in the dark, but perhaps it's relevance comes from the fact that it accurately represents both of the opposing forces acting upon price in the present time of the chart.

Failure to breach 3192 to the downside is an indication of selling pressure's inability to continue the [relatively] short-term momentum they've gained on the demand over the past eighteen hours.

Likewise, falling through the short-term support at 3192 signals the continued degradation of the demand that we've been noting as we fan our demand lines multiple times. Of course, falling through 3192 doesn't seem like it would be the complete death of the demand that's shown its force over the past two days, but it would be an indication that the supply we can see starting to form is a serious movement rather than a small hesitation in demand.

 

[tradewhatuc]

You then have to determine exactly what it is you're going to look for when the market opens in a few minutes. How is what you have right in front of you going to help you
make a trading decision?

The the mean of the range is acting like a line in the sand.

You would look for either sellers to stop selling and price heading up towards the supply line, or they keep selling and price goes to the demand line