steve46
Registered: Mar 2003
Posts: 3575 |
04-24-04 09:35 AM
Hey folks:
Its Friday night (actually it is Saturday morning) and I am doing some automated searching of Congressional Records as I promised Mr. Ramoutar (I'll tell you about it later). Anyway I wanted to mention some ideas with regard to Camarilla (which I know very little about) and pivots ( a subject I am more comfortable with) as follows:
Pivots are artificial "lines in the sand". On any given day, price may or may not "respect" pivot points. If you observe price over a period of consecutive days, you can get a pretty good idea of how price acts when in the area of a pivot. To get an idea of whether or not pivots will work on a given day, I look back to the right starting with 60 minute bars, and moving down to 5 minute bars. What I take note of, is how price acts...Whether it hesitates, moves on through, or fails to take out significant price levels including (previous opens, highs, lows closes. etc). I use the analogy of an 18 hole golf course. Each fairway is different, each green is different. Those of you who have had a chance to watch a good pro practice will see him (or her) pull out a notebook and make notes about the details of each hole. I do the same with each day's price action as it relates to pivots. Now on to specifics:
I noticed that when price approaches a pivot or other significant price point, that volume and momentum act together to give the trader a clue as to whether price will move through, consolidate, or just "chop around". Like an athlete jumping over a bar, price has to obtain momentum to move through a pivot. If you look at the way bids and asks speed up you as price moves in the vicinity of a pivot, you can see what I mean. If you don't have access to "time & sales", just look at the range of the bars (I call this the vertical spread). As price moves into proximity of a pivot, you will often see wide range bars which indicate increasing momentum. Once price moves through a pivot with momentum I will use that pivot as a stop. If I have not entered, I take advantage of that pivot to provide a tight stop. If I have a position, I look to add to my position using that pivot as a point where I will sell to close if price fails. I think this is about as simple as I can make it. I hope it is of help to you all. Best Regards, Steve46
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