Useful Tools

[jdm]

What I propose that if possible use Fibonacci series as ur periods ie 3,5,8,13,21,34,55,89,144,233 etc.

they are widely used. the elliott oscillator is made up of averages of 5 days and 34 days moving averages.

metastock plug-in AlphOmegaEW uses extensively the moving averages based on the fibonacci series.

 

[amitt29]

they are widely used. the elliott oscillator is made up of averages of 5 days and 34 days moving averages.

metastock plug-in AlphOmegaEW uses extensively the moving averages based on the fibonacci series.

I had mentioned these as for new guys.
What do u think abt breach of trend channel.

I use only metastock as the charting software(slightly modded for personal use,no plugins).No Software also for elliot analysis.The purple line that u see are the monowaves.Computed as explained by Neely.My only concern is y a five wave pattern is developing.Can somebody explain.?

 

[aca_trader]

Please note the breach of trend channel(by the OHLC) on lower side,implies oversold conditions.Vice versa on upper channel.
Regards
Amit

Amit,

Are ya sure of the channel lines drawn? Does not channel line involve creating a trend line joining pivotal points?

Regards,
--Ashish

 

[amitt29]

Ashish bhai(can I call u)
Apparently u r right.But if u notice now the "throw under"from oversold conditions.
The price action throws it above or below the channel.
U can interpret it as overbought and oversold.U apply it to ur charts and see its amazing forcasting ability.
Also the channels can have six possibilties(i feel)the upper can have 1)a downward bias 2)upward bias 3)horizontal(trading)bias same goes for lower.The first two imply trending.Convergences can imply termination.
Ofcourse correct me because i am still a new one.Though my status shows senior member.
Regards
Amit.

 

[gvnarendra]

I had mentioned these as for new guys.
What do u think abt breach of trend channel.

I use only metastock as the charting software(slightly modded for personal use,no plugins).No Software also for elliot analysis.The purple line that u see are the monowaves.Computed as explained by Neely.My only concern is y a five wave pattern is developing.Can somebody explain.?

hi amitt,

the five wave nature might be because of a running B wave corrective of B wave of higher degree.if that is true we may be in the 3rd or 5th wave of C wave of B.But if we go with the alternate bullish count of Caldaro we might well be in an impulsive move. but the first count is more probable I believe.

regards,
gvnarendra

 

[aca_trader]

Ashish bhai(can I call u)
Apparently u r right.But if u notice now the "throw under"from oversold conditions.
The price action throws it above or below the channel.
U can interpret it as overbought and oversold.U apply it to ur charts and see its amazing forcasting ability.
Also the channels can have six possibilties(i feel)the upper can have 1)a downward bias 2)upward bias 3)horizontal(trading)bias same goes for lower.The first two imply trending.Convergences can imply termination.
Ofcourse correct me because i am still a new one.Though my status shows senior member.
Regards
Amit.

Amit Bhai!

I am more new to the markets than you. Just one month of trading experience compared to a year of yours. That's why you will not see me expressing opinions in the threads of the Elephants.

IMHO, channels can very well be used as a trading tool however so as to using them as oscillators is concerned, I have some reservations. For example, a throw under may well be a case of breaking trendline. Also, as happens in the extended bull runs and especially in the last leg when the trendline becomes very steep prices usually cross the channel lines and move with a steep angle.Throw over from the earlier upper channel line if used for shorting (that is the use of oversold conditions, is not it) may get stopped. Besides, if somebody decides to stay away from the market action as the upper channel line is violated, he may miss very good oppotunity.

Looking forward to learn more on the topic.

Best Regards,
--Ashish

 

[amitt29]

Thanks GVNarendra bhai.
Also too many touch points on the channel,prevent it from being an impulsive wave.

Hi Ashish
Thats where the Elliot Channel(Trend Channel)is quite useful.I have seen it work umpteen no of times.

 

[gvnarendra]

hi,

here is a site which has lot and lot of explanation regarding trading using trend channels drawn with andrew's pitchfork.
http://www.medianline.com/

wish it helps some.

regards,
gvnarendra.

 

[amitt29]

Continuing on the treatise
We hear a lot about retracement.
The important retracement percentages are 23.6,38.2,61.8.These are primary retracements.
Retracements are calculated as these percentages the difference of immediate important highs and lows.Working on the theory that a price on its reaction will trace back at least these percentages.I will give an example later in this document.
In reality however there is a lot of difference,sometimes the retracements are more than 61.8 but less than 100 and sometimes less than 23.6 itself.
Noteworthy here wud be that these retracemnts are arrived by relationship of Fibonacci sequence nos. 1,2,3,5,8,13 etc
23.6 is arrived by dividing any number by a number 3 places to its right and multiplying by 100 eg 3/13=0.2307*100=23.6
38.2 is arrived by dividing any number by a number 2 places to its right and multiplying by 100 eg (3/8)*100=38.1%
61.8 is arrived by dividing any number by its proceeding number eg (3/5)*100
However in reality the picture is quite different,sometimes the retracements adhere to the number itself,55,89% etc.Its necessary to have a flexible approach.
Different ppl have differnt views on retracement(as to y they happen),my view is that since the net of any price movement is growth the retracement happens because the path of the price is riddled with hurdles,so it takes another route to achive its goal.In another words it goes around it.Maybe a long cut.
Regards
Amit.

 

[amitt29]

Now something about our markets,as we have seen in recent past our daily trends are being guided by Dow overnight(taking the morning cue) and Asian cues, also taking up as the day progresses the european market behaviour.A lot of traders take up positions based on this.The rally from 2595 low was triggered by the Dow having a 190 points rally.Some rally in some years.We have seen this wild swings in the Dow recently.
We are seeing this same thing in our markets.Huge swings.So a word of caution,usually huge swings mark the end of a trend.So whoever has taken long positions recently keep the stop losses tight and preferably at 3085.The immediate stop shud be around 3120.Dont try to catch the fallin knife.
The 1st upside from here shud be the high of yesterday 3201.Then 3233-35.And then 3277.Any closing above these levels will augur well.
And this was written b4 the Dow opened and it is holding a good 90 points gain.
http://www.traderji.com/50164-post50.html
Regards.