Learning to read Price Action with P&F Charting

Discussion in 'Strategy Building' started by HolyGrail, Mar 22, 2008.

  1. TTTrrr

    TTTrrr

    This topic was again raised. Most likely you'll be surprised if I tell you that when drawing P&F "High / low", you have a tench of support and resistance are not working. Drawing If P&F on the "Close", then you will be working through the support and resistance .
    And why would we "High / low"? you ask. If drawing to "High / low" and there are visible graphic shapes, which are not described in any books on the P&F. Look carefully.
    These figures are very expensive, and tench as well as support and resistance are profitable. For example in a standard TA is all well-known figure "Head-shoulders, in the P&F also have the figures but other. In soft BEB there are several such figures - such as a triangle. Look very carefully, that this figure does with the price?
    ....
    All the breakthroughs at the double, and triple-top description here in the forum, nothing compared with the figures and lines of support and resistance.

    Strategy is as follows:
    1- to the graph of P&F on the "close".
    2- to the graph of P&F on "High / low" for the exact purchase or sale.
    3 -to the graph of P&F RS on the relative strength. Note that in effect, too Close to work through support and resistance.
    4-Have matematiesky calculation chart Heikin-Ashi.
    http://www.investopedia.com/terms/h/heikinashi.asp
    5 - With the data Heikin-Ashi build schedule RSI (20-80), speaking with confidence in 80% of the By or sale.
    http://stockcharts.com/school/doku....hnical_indicators:relative_strength_index_rsi
    For RSI to pick up the value of "day" (14) itself.
    With all this you can even trade Set the robot. What I'm doing today time.
    P.S.
    Heikin-Ashi + RSI is a very good indicator.
    For RSI should have only the Close Heikin-Ashi .
    Close (Heikin-Ashi )=(Open+High+Low+Close)/4
     
    #1551     Jan 30, 2010
  2. Ahh, I see where your going with this. Until it is complete, it is a subjective call. It does need to be complete in order to properly set up R's for a trade entry.
     
    #1552     Jan 30, 2010
  3. page 155...

    Depends on the market posture, once again - but taking that into consideration... with uncanny reliability.
     
    #1553     Jan 30, 2010

  4. Props to you, Wizard. Now you are getting it.

    In the late 60's, a study at the Univ. of Chicago/Booth School found that investors spent 80% of their time evaluating companies fundamentals and 20% of their time evaluating the market, sector and stock action. They had dismal results, on the whole. Their results would have been favorable had they reversed their efforts.
     
    #1554     Jan 30, 2010
  5. p 163

    It may be best to stay with a two percent default as a primary guide and use a narrower universe like the SPX for something more responsive. Also of note is the number components of traditional BPI's

    NYSE - 2700+ (primary LT trend - listed names)
    Optionable BP - 3000+ (intermediate term indicator)
    OTC - 5000+ (primary LT trend - Nasdaq)

    In a pinch, you can add noise by speeding the chart up with a tighter box size, but - in addition to the SPX BP - there are shorter term BP's like the Hi-Lo Index and the Percent of stocks above their ten week MA. These are much quicker and act as early indicators.

    I would use the SPX as a surrogate for the Optionable in its absence.
     
    #1555     Jan 30, 2010
  6. Tighter on your entry - closer to your stop. Patience and discipline... if you don't get the fill, you save your capital.
     
    #1556     Jan 30, 2010
  7. You had been doing wonderfully until the BP's weakened... heed them!

    As a suggestion, tighten your entry, double your position going in and flip the first one when your R/R is cut in half. Get more conservative with your target. Be very diligent with the remainder.


    MS... I can't believe there are 90 pages left. I'm enjoying exercising my noodle once again. Great thread! But the ugly stuff is ahead... ... ...
     
    #1557     Jan 30, 2010


  8. X 10...
     
    #1558     Jan 30, 2010
  9. p 171... 6/25/08


    I'm hoping to learn that you didn't go live... ...
     
    #1559     Jan 30, 2010
  10. p 175

    The NYSE BPI reversed up in early July.


    Market, sector, stock...!
     
    #1560     Jan 30, 2010