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Orwell

1,751 Posts.

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30/08/15

12:07

Post #: 15900995
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Originally posted by pilsner ↑

Thanks also Orwell,
How are they formed? My mind is stimulated by technical geometry, form, structure and patterns always has been from an early age, I see these patterns everywhere in different charts and in all different time frames.(fractal like elliott). All I have done starting about 8 years ago is basically overlay and trace (best fit) 100’s if not 1000’s of historical index and stock printed price charts in varying LT timeframes from around the main pivot windows, to come up with an 18 year repeating overlay pattern that is the black lines on chart 1 above. When I say best fit it sounds a bit “rough” like she’ll be right mate, but its not as once you can establish the correct datum there was hardly any manipulation from me required to complete the task when the basic shape had been sculpted. It took me years of playing around to complete this basic task to end up with something that to my astonishment in the last 5-6 years has not let me down….yet!, and at the moment it projects bear market price movement out to around 2021.with the odd secular bull. I Have also since found on the net, similar model patterns that were discovered and then applied as a forward predicting model as far back as from the 1930’s and when I saw that pattern and the overall timeframe other than a couple of small anomalies it was almost Identical to what I had come up. In the last 4-5 years I have been working on another template that breaks down the above Mthly/yearly project into the Minor weekly waves this is what's led to the need to understand cycle timeframe more accurately. At the time I was reading up on elliott wave theory, Gann and VSA. It was VSA that stimulated a thought that if it was volume that is the constant then understanding volume intimately and particularly around anticipated future critical cycle pivots (accumulation and distribution) . During that research I found certain other patterns in volume bars that I persued that now forward project the cycles in my medium term work so that is where the MT anticipated "timing" on the second weekly chart come from. All I do now is look closely around the days leading up to the anticipated turn windows and look for early signs of volume signals in any index/stockchart to confirm if the anticipated reaction in price is going to be confirmed.
Studying Elliott blew me away, waves and patterns and how accurate they are in the larger timeframes so yes there is and I would expect you to see the similarities in the 5 waves up as they are so predominant in all charts. I also get the C wave down you mention (not shown in above charts) I get it starting from early 2017. Either way what I think we both get is what could be broadly described as a right shoulder formation in the same forward looking period. It could be that the 5th wave up in my model (late 2016) gets snuffed out by your C wave down at say 50% retracement at circa 5300 ish and doesn’t in fact re challenge the high. I think that would still fit with your outcome. Either way I will be looking for the volume signals around those critical weekly turn windows to try and better understand what the market is saying at those particular key point in the future.
Yes Apols for the Black line error on the weekly chart that was my fat finger when I attempted to quickly place those mthy ref lines on that weekly chart for comparison of overlay. The correct one is On the Mthly at circa 4500
Interesting that the Moving Averages you mentioned do play a critical roll in support and resistance, this is just one more aspect of charts that leaves me in awe, as they are nothing to do with how the black or red lines are formed. I have always used those same averages in trading setups and they are on all my charts in all timeframes. Likewise you mention average pricing for the black line highs, actually I think that is correct but ….I haven’t thought of it like that before. Just remember those lines where not calculated from the candles that you see on the screen but from candles from years and decades past….. Gives you that humble feeling in the bigger scheme of things!

Creative license yes….haha.... where would we be without it!

Thanks for the Banta…..enjoyable to discuss with like minds.

Expand

Pilsner, I'll avoid writing another essay here so as not to bore everybody else. Just wanted to say I respect the work you've put into research over the years. That's the professional approach to trading.

Also to clarify I only use classical charting techniques, I.e. only things you can hand draw on a chart (if you had a mind to) like the guys in the 1930s, no technical indicator stuff that can only be done with computers. So i don't use moving averages at all.

Also i don't rate VSA analysis and it seems only on Hotcopper I come across it. Volume is relevant in interpreting other technical patterns but I don't see it as particularly useful as a primary form of analysis in its own right. Maybe that's for another day.

Thanks.
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