Support and resistance..( help pls)

Quote from cashmoney69:


NihabaAshi

did you trade stocks before futures and also do you have a background in economics or something?

as far as S / R goes.. do most brokers offer free software to spot support and resistance or is it something that I'm going to have to learn mentally?.. not that its a problem, I just dont want to waste my time if its not necessary

thx guys :)
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Hi cashmoney,

I want to to ensure you understand that my candlestick s/r discussion was in relationship to the fact that your question was about the candlestick s/r level discussed in Nison candlestick book.

Further, there is a difference between Nison definition (interpretation) of s/r levels and the usual traditional s/r level discussion.

This thread is also a good example of the different types of s/r methodology currently being used and talked about.

Therefore, to prevent getting further confused about s/r analysis...

Your going to need to make a decision to either learn a different interpretation of s/r levels or stick to what's being said in Nison books considering you have an interest in Japanese Candlesticks.

As to your question about brokers or software that spots s/r levels...your now asking about the traditional s/r level stuff that has nothing to do with Nison's stuff.

With that said...there are dozens and dozens of free websites giving s/r level and pivot point analysis info that deals with futures, derivatives or currencies but I don't think there are any free sites specific to particular stocks.

Reason why specific stock s/r level information via that site called Trade-Ideas.com that was mentioned by Diamondtrim may be worth exploring although I'm not familiar with exactly how the info is used...

It's not a free site but does have a free trial.

Also, here's an example of a free site that deals with the traditional interpretation of s/r levels via pivot point analysis...

http://www.deltat1.com/DailyNotes/pivotpoints.htm

(I have no affilitation with Deltat1.com nor Trade-Ideas.com and both sites offer subscription based info while Deltat1.com pivot point analysis info is still posted for free.)

How you use and interpret the info is subjective from one trader to the next.

The above is clearly different from candlestick s/r levels that based upon specific candlestick patterns, WRB analysis or Long Shadow analysis.

Now...Nison book gets into drawing trendlines so I'm going to assume this is what your interested in and not interested in some specific price point like what's shown at deltat1.com nor at Trade-Ideas.com.

That's something your going to need to learn on your own because I never heard of any source that automatically computes such based upon what Nison talks about.

Simply, determine what direction you want to precede with...

S/R Levels via pivot point analysis or S/R levels via trendline analysis or a hybrid of the two.

S/R Levels via pivot point analysis is a mathmatical calculation and can be subjective in interpretation from one trader to the next.

S/R Levels via trendlines is not mathmatical and is more art than science that's dependent upon what you consider to be key reaction levels to base the trendline upon.

If I may the above sound confusing...I apologize and hopefully someone else can come along to provide clarification.

As to your other questions that's more personal...

I'll send you a pm.

Mark
(a.k.a. NihabaAshi) Japanese Candlestick term
 
Quote from cashmoney69:

Trader273

ok, so is it safe to say that:

the support line is when the prices hit their lows (bullish signal to buy) and resistance is when prices hit their highs (bearish signal to sell)
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I would agree with most of that statement. However, I thinking looking at more then 3 months will you find the support/resistance lines. Also, just because the price is approaching your newly founded support line, I would not buy just because the price is close. I think you would need some other form of analysis. Be it stochastics, macd, or whatever. If you like candlestick analysis, if you get a valid candlestick pattern at a support line, now that could be used as a POSSIBLE entry.

Quote from cashmoney69:
and that green "minor" line is the median price for the stock being traded for that time frame...in that case, it was a daily chart
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I wouldn't say that the green minor line is the median price. I called that a minor support line because it only had a few recent days to give me the support line. Other words, I would watch that level, but would take the other analytics to show a buy at that point. I would be more bullish when it gets down to the 17-16.8 level.

Hopefully this post is clearing things up for you and not confusing you more.:)

-Trader273
 
Cashmoney,

After thinking about what you were probably looking for with this thread, and the fact the mini's are starting to slow down, I decided to go back on the daily chart and find the support-resistance levels. Also, i include a FALLING WINDOW, or more commonly known as a gap down. This occured all the way back on August 10th, but it never filled. What I have seen is that the window is still valid unitl it is filled. There were other windows since 8/10, but they have filled. This is just what I have observed though. Also, i would look at volume and how it reacted around the levels. It would NORMALLY take higher volume to break a level. Not always, but that's what i have seen. Hopefully this will shed more light on candle s/r levels.

-Trader273
 

Attachments

NihabaAshi

" Now...Nison book gets into drawing trendlines so I'm going to assume this is what your interested in "

drawing them or applying them mentally is

my goal to a candle stick chart for any

stock for any time frame. I want to be able

to look at a chart and say to myself "ok I

need to buy here at this price and sell

here.." (well in theroy at least)

NihabaAshi

" S/R Levels via trendlines is not mathmatical and is more art than science that's dependent upon what you consider to be key reaction levels to base the trendline upon. "

ok, so it seems to me that S / R is very

different from trader to trader and very

opinionated. With that being said.. is there no STANDARD for learning this, or is every book that talks about s/r going to be that AUTHOR'S OPINION on what s/r is? ...

NihabaAshi

" Be careful about getting normal s/r level discussion confused with what Nison explains in his book as s/r levels based upon Japanese Candlestick analysis. "


What is NORMAL s/r discussion?

I would like to learn s/r based on candles, so if its not nison...do you know any other good books out there?

sorry for typing so much :)
 
Quote from cashmoney69:

NihabaAshi

What is NORMAL s/r discussion?

I would like to learn s/r based on candles, so if its not nison...do you know any other good books out there?

sorry for typing so much :)
More...

Hi cashmoney,

What I meant by normal is traditional discussion of s/r levels via pivot point analysis (mathmatical computation to produce the info).

How we interpret (use the info) the above consumes many discussions about such here at EliteTrader.com

Candlestick s/r levels or zones is what I consider to be advance trading because you can't just jump into it without first learning the basics concerning candlestick patterns.

There's a ton more to it than what Nison reveals in his books.

First the trader needs to learn a few candlestick patterns and become consistently profitable at it or else moving on to the next level is just a waste of time.

Next level would to learn about supply/demand or learn about it while learning to apply candlesticks pattern recognition.

There are some excellent old threads here at EliteTrader.com about supply/demand by dphoenix and its easily searchable via the below link...

http://www.elitetrader.com/vb/search.php?s=

Best place to start for candlestick patterns that exploits supply/demand is Hammer patterns or any candlestick pattern that's part of what I call the Long Shadow Family.

Next level is WRB Analysis.

The above is searchable also.

Then...only then when the above is understood (will take a few years and I'm not kidding)...

Candlestick s/r levels (zones) won't confuse you.

The key is to understand the price action (key areas of price reactions) prior to any appearances of particular candlestick patterns...

Then use those candlestick patterns as reaction points to base your trendlines or s/r zones.

Like I've hinted...it ain't easy...your going to need to use many different resources to put the puzzles together because there's no one book that's going to have in spelled out in black & white for you.

Thus, ET itself has a ton of puzzles for you to piece together that should keep you very busy for a few years as you try to piece it together and apply it.

Approach this like you would a 4 year college education...you got to learn and pass Trading 101 before you are allowed to take the class called Trading 201 and so on with 301 and then 401.

Good Luck.

Mark
(a.k.a. NihabaAshi) Japanese Candlestick term
 
NihabaAshi

yes, right now I am on chapter 4 of nison's book (second edition) and I'm taking notes on candles , their patterns, what they mean, how they trend and all that good stuff. Its a little confusing at times and can make my eyes cross, but its interesting.

thanks for all your guys posts, its been real helpful :) .
 
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