Discussion in 'Risk Management' started by onava, Jan 18, 2011.

  1. onava



    i have a problem. i am okay at picking levels, but how do you know they will hold or not without using indicators..only price and time!!

    tricky one eh!!
  2. Since when indicators tell whether a level will hold or not?
  3. onava


    i didnt say that.. as i wrote in the sentence
  4. 1) Al-a-kazzam, al-a-kazzoom! A market should "bounce" hard and fast off of a "level". Little time, if any, is spent there.
    2) If a market consolidates, i.e. spends a lot of time, near a "level", you would expect the market to eventually break through the level. :cool:
  5. onava


    sometimes yes.. but what about overshoots..

    what if it gets close to the level and tanks

    how would you trade this situation `?
  6. 1) With an overshoot, you would tend to expect the "level" to "contain" the market the first time it is tested on a retracement. The second or third time there it would tend to fail. You can use it as a location to exit and/or reverse your original position.
    2) If it tanks after getting close? Isn't that what you want from your original question? As always, keep losses small. :cool:
  7. NoDoji


    Levels are visible on any chart, so anyone can "pick" them.

    Levels are a previous price bar's high/low, a previous price bar's open/close, a pivot high/low, yesterday's high/low, last month's high/low, a 52-week high/low, the outer boundaries of a range, the outer boundaries of a channel, a trend line touch, a % retracement line and so on. Traders/investors in many time frames using all of these things.

    Nobody knows if a level will hold, absolutely nobody. If you want to put on a trade at a level because you think a level will hold, or put on a trade because you think a level will break, go for it and use a protective stop in case it doesn't work in your favor.
  8. onava


    what about Market depth(dom).. is there anyway the tape can be used to anticipate. the direction
  9. onava;

    An essay could be written on a vey elegant level to explain how everything about markets melds together to provide for all the needs of any trader to be able to continually extract the offer of the markets.

    So yes, anything one can observe contributes value to a full, continuing and elegant solution for extracting the offer as it is made.

    The dynamic equilibrium will always provide anything you need or want to know about markets. The beauty of it all is that anyone can participate as he pleases and the market is always right, has no noise and no anomalies exist, ever.

    Fortunately, Nature provides abundant complete and corroborative examples of how any human enviroment works.

    As you say, the levels of the variables of an operating market always afford the observer a complete and thorough control for his endeavors in participation.

    People can choose how they want to relate to the market system and most probably choose to endeavor to either participate or master the opportunity. From what I have seen, hardly anyone gets anywhere in satisfying their goals or aims. Mostly, what is there cannot be seen for what it is and wave after wave of popular distortions prevail as this culture banters about just what is what. This will never change because of the role of wealth or not having wealth is unchanging in any contemporary society.

    The advent of data processing and analysis does make it possible to leave trend following by the way side but nothing in the public eye has made monitoring and analysis conventionally useful.

    Certainly, evething needed is available to allow a participant to always "know he knows" with regard to any market.

    What turns out to be the main distraction for most is their decisions to believe the many many myths of the markets.

    In a dynamic equilibrium it is possible to have referent levels for the variables of the market. I always make sure I have a very broad and complete set for every event of the day. Events are the independent variable of the market.

    No one has publically documented how markets work as yet. It might be that it would be construed as very risky to be so outstanding.

    The conclusion is that, yes all the levels are there; they have flawless utility; and a full complete set is always available.
  10. ammo


    you never know if they will hold/reverse or break thru,it helps to have levels selected on several instruments and see how they react together,,you can also use several level indicators,trendline,market profile,fibs,congestion ,recent multi lows or highs,will give you a lot more confidence in your decisions,ultimately you are prepared to cut a loss,knowledge is power,
    #10     Jan 24, 2011