The Trouble With Scribbles

I see a hinge. Maybe a trade or two soon. I'd rather be golfing.

I know marketsurfer wants to know whether this means up or down. Answer: Yes, this means Up or Down. Or it could just dribble aimlessly for some time.





EDIT: Logging off now. Its time to get to work or get outside. But I'm done here for a while. Good trading to all!

 

You could always try a SIFI trade.

 

Great thread. This is what I see:

 

You are letting Surf off too easily.

It could also go Up AND then Down.

Or Up, Down, then FINALLY Up.

Bulkowski has backtested percentages for these (for stocks) in one of his books.

 

First post, eh? Welcome. You picked either an excellent day or a terrible day, depending on what you want to learn. So let's focus on what looks to be your effort to find the halfway level.

The halfway level applies to any "wave". You can find the halfway level for the current "mega-wave" or whatever much-smaller wave you happen to be trading. In this case, the larger wave runs from 4440 to 4370, half of which is 4405. If price can't get past that from 4370, demand is weak. If it can get past it and stay above it, demand is strong.

What I find equally interesting, though, is that ever since Monday afternoon, "5" has assumed an importance which is a mystery to me. It acts as support, it acts as resistance, it acts as the median in narrow and wider ranges. The "why" isn't all that important, but the fact that this keeps cropping up is intriguing. That and the fact that we've had far more hinges and narrow, long-lasting ranges than usual, each of which represents equilibrium at the time. Perhaps it all has to do with upcoming earnings. But until the big-money traders make up their minds, I'll just watch. They can't just futz around here until earnings season is over.

Incidentally, you may have noticed that the mid-point of today's range is "05".





Context

May as well throw this in:

 

Is this how you came up with 4440 as resistance the other day?

 

Would this be more accurate for your 2nd chart? Or is it close enough?

 

No. This chart from last week:

 

Depends on what you're looking for. If you're in Europe, and you saw price rise to 4400, then drop to 4390, then wanted some measure of strength and weakness, you could draw your midpoint between those two levels, as you've done. You could then have placed a buystop above that halfway level. This is all hindsight couldawouldashoulda of course. If this is something you want to look at, you'd have to examine the success rates of taking buys and shorts off these midpoints.

 

I'm not looking at that level in hindsight. I'm looking at that level where support may happen on the way back down. Something like this.