Some of my forecasts

[sanjosedesi]

Re: Nifty

I'm getting a little bug eyed from being tired, so whatever response don't get taken care of from this point, it's because it is midnight here.

Awright Paul, have a good sleep. We will continue later. The world is not ending, at least not today ;-)

You are right about the bias. On one hand, even within technicals, there are 10 different things to balance within indicators, within time perspectives and so on ... and to make this complicated with FA / news flows makes it even worse. Fully agree. Maybe it is time to choose a side.

That probably also means more emails / comments to you, do hang on for the onslaught ...

 

[sanjosedesi]

Re: Nifty

Keep in mind, sub- 4,000 is not confirmed yet, only 4657.

I know I have mentioned it 3 times by now, and you might be pained of the repetition ... but ... when you get the confirmation, please tie it to potential timeframes ... at least an indication whether these moves will happen progressively like they did all of this year, or like last week breaking all circuits all over.

 

[4xpipcounter]

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The type of movement that has been seen from Nifty is uncommon. I also posted an exception to the rule in order to explain the exception. Let me digress, everytime (I don't know of an exception.) a move breaks records for velocity, there is a TA explanation.

As far as Nifty is concerned, I mentioned the most recent events. The market was busting at the seams. It had the weekly TL weighing down on it, the daily was at an extreme with regards to a channel deviation. The 4-hour felt like a balloon in the middle of a bunch of porcupines. The whole thing was going to blow. Add to that the monthly is still in a strong downtrend. Those southern jets are still wide open. I'm trying to paint a picture of what builds velocity and the high head of steam that makes these moves.

I also talked about the CHF/JPY and the move that made a 1,000-pip drop in 3 days. It broke 300 pips over my containment level, then something dawned on it, "Yikes!!! I'm going the wrong way!!!" Did I trade that? No!! If I entered that trade at my containment level, about the time it took to write these comments, I would have been minus 300 pips. I can get my pips once the markets settle to a lower roar.

Now, what in the world is that chart doing up there!?!? Oh yeah, I got to explain that one too.
It was in Nov. 2007 I was in my chat room I had at the time talking about a major explosion that was about to happen. The market kept teasing us after it got to 2.0600, and finally peaked at 2.1156. The trifecta, quadfecta, quintafecta, you name it, no joke! They were all working to show cable some action. It was this time many were bagging on the US economy proclaiming how the market was headed to 2.2500. Then comes little 4xpipcounter with only a 12th grade education telling everyone who would listen, look out! This puppy (Ah, no offense Tucker.) is gonna blow. Every TF was highly OB, hitting extremes everywhere they could be found. Many laughed when I said we are headed to 1.8160, and most likely lower.

The point is this. Moves like we have seen are uncommon. But then, it is uncommon when every TF matches the way it does along with such extremes being hit. When that happens, get out of the trend, and get ready for the reversal!!! The trend is not your friend!!!! Now, you know why I hate cliches.

BTW, that sideways movement from January to July of 2008 was only an eastward buildup to another magnificent drop. After all, the monthly was barely reacting to what was going on. Many thought the market was reversing at that point. LOL, yeah, right!!! 6,000 pips later it did.

I would be lying if I said I predicted the fall to 1.3500. But, like I say often, if you know it is a freight train either get on board or get out of the way.

To add the previous comment, one thing which has surprised me is the speed / velocity of the change. I have a model which has a component of stop loss, but it still requires holding some positions which obviously requires drawdowns. It is all manageable as long as it is within the parameters you set out ... but when you get into such a high speed ... wow !!!

Would you be able to (at some point) talk about how to predict the speed of changes. I think so far we have been talking about the end points (or targets or pivots) and speed will be an interesting aspect to discuss.

Thanks.

 

[4xpipcounter]

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BTW, so it is not taken wrong, my "rampage the thread" comment was actually meant in a good way. I love it when you all come by. It gets me off the video games and back on the charts.

Ashwani, I am going ot have to share with you my opinion of market volatility. To me, volaitility is not when markets makes strong one-way moves. That falls into the category of the high velocity we're talking about.

Momentum is something that can be tradeable even though as in a game of sport, momentum in the markets can change quickly. The recent chart I posted on the GBP/USD showed it losing momentum while it was climbing the hill. Afterward the strong reversal came that last 2 months. Momentum was still onits side after the pair went due east for 8 months. That was proven when an even strong move ensued right after that.

Momentum is something nice to use in placing an intraday trade with. Let's say there is a strong directional reversal. Afterward, the market goes east (This can best be observed in forex on the hourly.). Whatever the momentous move was before the market went east should be the same direction it will continue in.

Accompanied is a chart of what I am talking about. Obviously the monthly in the previous post also bears it out.

can you guide me ,how momentum can be seprated from total voletility(momentum :speed of chang in price:velocity of the changenly mathematical formula

 

[4xpipcounter]

The AUD/USD had a reversal this week at 1.0600. It was very strong. Momentum is currently giving out. It lost a lot of the velocity that it had. The reason is that even though there is a clear indication it is headed to the low 1.02's, the hourly and 15-min (You read it right.) are extremely OS and it's clear those TF's need correcting.
In choosing my indicators, I wanted to use ones that I could pinpoint velocity with, as well as momentum. The stochastics has been a good friend for that.
Momentum is not always predicted. I have gotten into trades where I think we are headed to a certain point, then I get into the positive, and then it seems to give out. It just had the appearance of lethargy. It is that point that uncertainty sets in, and its time to get out. After all, when momentum gives out, it could lead to a gigantic move against you.
Also, once a market gets to an extreme point, that of itself is an indicator. Sometimes, it will even lie to you, like the CHF/JPY and get a burst of energy. This is where the ichimoku came in real handy in telling me that dude's ears are popping. It is the TL's that told me the trend broke, once and for all, and the reversal has begun.

I have no idea ... I know we have various indicators, and from what I know momentum is used to predict changes in trends ... my original question is ... how do you predict momentum itself. Obviously if I am mixing up terms, do correct me.

 

[4xpipcounter]

Okay everyone, we'll talk on the other side of 8 hours.

Timepass, I like your point. It's one of those cliches I don't like (nothing personal) , so I will be obliged to address it after I wake up.

 

[sanjosedesi]

The point is this. Moves like we have seen are uncommon. But then, it is uncommon when every TF matches the way it does along with such extremes being hit. When that happens, get out of the trend, and get ready for the reversal!!! The trend is not your friend!!!! Now, you know why I hate cliches.

I guess we need to keep an eye for trifectas, quadrafectas and what not ... and when the signals are all pointing one way, that indicates not only overshooting the targets but also that it might happen very quickly.

 

[4xpipcounter]

Re: Nifty

Timepass, it is really the anti-thesis of what we have been talking about with regards to momentum.

There are several mistakes people make in try to determine the direction of the market:
1. Open a chart and see the candles are going north, so they conclude we must be in an uptrend. They jump in and find they are going the wrong way, because by the time they entered, the trend reversed.
2. Other people use an MA crossover system. These MA crossover systems sell lots of e-books, because they look good on paper. I could take you to any trend and show you the perfect MA crossover with candles going in the direction of the crossover. There are professional scammers that use and have systems related to an MA crossover that are selling to and beguiling people. I could name a few names, and I would do it, but not in an open forum.

This is why I use:
1. Stochastics-- For me it is a very good momentum indicator.
2. Ichimoku-- It locates a trend and key chart S&R's.
3. Trendlines-- They tell me early when the trend has officially switched.
4. My proprietary S&R's-- They measure the trend's range within any time measurement. You can give me any 4-hour chart with the values on it, and I can prove it.
5. Standard deviation channel-- This measures the potential explosive reversal within any TF. In lieu of this, I get e-mails and people replying in my C-box on my blog exclaiming, "How did that happen!?" They were looking at their 4-hour chart and was wondering how things were moving along so well, then out of nowhere a 50-pip reversal, and then right back in the trend, but only more powerful. The answer is the 5-min was operating in the background and became highly OB/OS at an SD channel extreme.

Some might say think, "All of that is fine, but that is a lot of work to look at those indicators, viewing all those TF's and then trying to collaborate it all."
Look at it like this. If it took, 4-5 hours for proper study of the charts to enter one winning trade that might last 1 hour, is it not worth it? The only thing you needed to do was sit at the computer with your feet propped up somewhere, with a sandwich and an ice tea somewhere close by, and then all you had to do was click the mouse to make lots of pips which converts into cash.
The above is a perspective. I tell my college friends there are no degrees in trading, just constant learning. Respectfully, there are many people pushing a broom in a factory or flipping hamburgers for the same money in one week that successful traders make on one daytrade.

Ha !!! By the time one can fathom the direction of the market, it is already moving the other way !

 

[Piratetrader]

sir loosing momentum is a retracement for a short period of time or total reversal when a trend changes!?

 

[4xpipcounter]

Re: Nifty

Awright Paul, have a good sleep. We will continue later. The world is not ending, at least not today ;-)
Well, well, SJD. I woke up, asnd back in front of my computer, so you were right. One of these days we won't be saying that. Average life span is around 26,000 days, so make the most of each and every one of them.

You are right about the bias. On one hand, even within technicals, there are 10 different things to balance within indicators, within time perspectives and so on ... and to make this complicated with FA / news flows makes it even worse. Fully agree. Maybe it is time to choose a side.
If it gets too complicated, then let it go by, and look for another market to trade. This is why I track 11 forex pairs for my Weekly Forecast, and 28 total for my personal trading.

That probably also means more emails / comments to you, do hang on for the onslaught ...
I set myself of but I enjoy hearing from everyone. I've even made bold statements in trying to bait a few and that has happened. I think it makes for great learning for all of us. In talking about this it furthers ensconces my belief system, thus applied to my trading, so I hope we all benefit.

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