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Part 2. The Power of Algorithmic Support and Resistance - AppleWelcome to Part 2 of the series examining algorithmic support and resistance (S/R). Today we'll check out Apple Inc (AAPL), and how the algorithm defined S/R zones over the last 15 years. So, as I mentioned in Part 1 (see the Related Ideas link below), the algorithm incorporates a number of factors to determine, in real-time, viable support and resistance zones. I primarily trade currencies, and dabble with some indexes, so I was interested to see how the algo performed in a upward biased equity market (equity markets, unlike currency markets, have an intrinsic upward momentum over the long-term). Spoiler alert: it was almost flawless. Now, I have to admit that I've cherry picked this example; not every equity/currency/index/bond market will work this well - but it is a good example of how valid the algo is. But, like every tool in a technical analysts arsenal, nothing works every time. Okay, without further rambling, let's check out some examples. We'll start back in 2006: So far, so good! There were heaps of great tradeable signals provided by the algo. Remember, as soon as a zone is identified (the vertical background colours), you can trade any subsequent signal - there's no need to wait for confirmation of the zones validity. Let's have a look at the next chart: The really interesting thing for me is how price gets stuck between Zone 3 and Zone 4. This is a perfect example that highlights how accurately the algo manages to identify zones, and how the market respects them in a consistent manner. Onto the next chart: Here we can see how, even when a zone is initially breached, it can later provide significant support/resistance. We never know exactly when a market is going to respect a zone - we simply have to wait for market/price confirmation. The next chart: Again, some really great trading opportunities here. Breakouts and retests of S/R zones are particularly great trades. You will sometimes experience false breakouts, but that's where trade and risk management comes into play. I really love how zones can come back into play years after they're formed. Okay, the last chart: Now we're up to date! Zone 8 again provided some great opportunities, and Zone 9 has yet to be re-tested by the market. That's all I wanted to cover for today. Basically just providing further examples of how the algo forms zones, and how the market (fairly) reliably reacts to them. Knowing where the market may react and where price may turn is half the battle. As you can see, you could have made a great deal of money trading these signals (ignoring the fact you could have made a great deal just buying and holding Apple, but that's not what we're looking at today). Feel free to get in touch if you have any comments or questions! All the best, DD
NASDAQ:AAPLEducation
by DreamsDefined
2
USD/JPY Multi-TimeFrame Analysis Monthly: Huge rejection of 112 level with two spinning tops and a huge bearish engulfing candlestick Weekly: Break & retest of 108.5 zone with a nice shooting star rejection candlestick Daily: Bulls failed to take controll of the market by breaking the ascending trendline. Bearn are now on controll 4Hour: We have a descending channel. Price retraced to our minor zone and fib 61.8 and also correlates with our 50 EMA Waiting for price action to pull the trigger #tradesafe
Short
by theforexdaddy
1
DXY Support zone and possible TP area for bullish pull backIn this chart we can see the dollar index finding support at the same area as two previous lows. You may also notice Monday closure perfectly landing on our -0.27 Fibonacci extension, furthering on we spot a daily bullish spinning top Tuesday rejecting the low zone previously mentioned and closing above the fib level! Running from the end of September 2018 we have a trend line, holding price up on multiple occasions. That is until recently, the break of this trend line came in mid June. If price manages to break back through the base of our Fib I would likely be looking for short entries between the 96.75 and 96.85 region. This not only coincides with our trend line but looking left also a decent sized mid range zone.
TVC:DXYShort
by Trading-Ring
AU: Holding Neutral ahead of RBA DecisionAU remained neutral ahead of RBA decision - closing below .6935 resistance -- A retrace to .69650 could be in the picture before cut talk; My view remains to short and should remain bearish under .70000 price point. AiG Manufacturing news out soon will help set the tone heading into the week... Support Levels: .68950, .68650, .68250 Resistance Levels: .69350, .69650, .70000 *Not Professional advice, just my viewpoint. Let me know what you think! -Krecioch
by Krecioch
AUDNZD Fresh supply & demand ZonesWe are seeing that currently, we placed our fresh major supply and demand zones in our trading pair AUDNZD , It has yet tp be breached with price and hence we have an untouched zone, deemed worthy of being a confirmation for a reversal since our extension area. We are currently in a nuetral position with this trading pair and we are looking to go either long or short based off what price action is going to be telling us.. we have the coordinates on each of my zones, in (AQUA) colour so you can see exactly where my zones are... This will be done with all my supply and demand zone analysis for today only until we exeucte our positions. Watch and wait for either our supply and or demand zone has been Penetrated with price
by Trellz_