You do not take the 38.2 because it blew right through it. You wait to see if the fib is respected or not. If it bounces off the fib level (like in F 50%) then it is a potential reversal trade in the other direction.
So the dynamics and the price of auctions will be accomplished by the dictates of geometry, astrology, including the moon phases? Sure there are cycles in the market but to extrapolate them to precision market price is a bit of a stretch. LOL. There are too many variables and unknowns. Even variables not yet considered. Then there are the absolute unknowable variables. To say that these unknown things are governed by well …..geometry and astrology is IMO an attempt at dictate to the market what it must or should do. Of course, that will not work. There are only possibilities and probabilities of possibilities as to what the market will or may do. While manipulation to some degree can happen even total manipulation cannot be effected because even the manipulators do not know all the variables. IMO the best thing to do is have a strategy that is quickly adaptable to what the market IS doing. And since it does have inertia the more recent things it HAS done can be a factor in assigning probability to a possibility. It is important to remember the market can go up or down. Stall or goes sideways. We can only observe and act upon that observation. All our lines drawn may help us “see” a little clearer what is presently happening but that does not mean it WILL continue to happen. There are simply too many possibilities and variables that the best we can do is try to see the complete picture and arrive at a probable possibility based upon in part, inertia. Ever ponder why the market burst through fib lines, (which I don’t use) trendlines (which I do use) and other such things? Ever wonder why one PB evolves into the resumption of the previous trend and another PB, in a similiar scenario, in terms of context and size, evolves instead into a reversal of the previous trend? A factor to understanding this phenomena is being skillful in reading the “pressures” enacted in the more recent past bars. Two entry setups can look almost identical but behave differently. Price tends to move along the line of least resistance. Hence inertia is born. And there can be no inertia without force or pressure.
Cool. Haven't really dug into Gann's work. Any references you'd recommend? Better yet a thread on Gann would be interesting and will refrain from asking questions about his work on this thread.