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DT: Of course! I agree with your hesitations. I believe that some
ratios are "more common", ie, reversals occur at some ratios more often
than others. EW aficionados can usually "tell" which ratios are more
likely. Much of it (it being somewhat voodooish, somewhat experience)
depends on previous patterns, which wave, what timeframe. You are
certainly right to wait for other signs and signals. Plus, we should
always use OTHER confirming indicators or supporting information.
The Dynamic Trader program will also allow you to plot/extend fib time
ratios (something I asked TJ for over two years ago---but I am not so
anxious anymore). With this, you can plot various fib retracement
ratios from various pivot points in the past. You can superimpose fib
time ratios. This allows you to draw a "box" (price retracement levels
form horizontal parts of the box, while time ratios form the vertical
sides of the box) which is supposed to represent a very high probability
"zone" (time and price) for a tradeable reversal. Wavemechanic here
uses DT (I believe) and perhaps could comment.
After all that, I agree with a hesitation, and do not know how to
consistently make these kinds of trades. Others, however, can and do.
Have a nice day.
Ken
PS: I imagine your creative programming talents still do not enable you
to program fib time lines.....????? :-(
-----Original Message-----
From: DIMITRIS TSOKAKIS [mailto:TSOKAKIS@xxxxxxxxx]
Sent: Saturday, June 12, 2004 2:18 PM
To: amibroker@xxxxxxxxxxxxxxx
Subject: [amibroker] Re: Fib solutions vs the tough market decisions
Ken,
I didn't explain the usual Fib pattern since it is easily available.
The question is the same : Why not 0.382, why not 0.500, why yes the
0.618. If you have already two Long positions at 0.382 AND 0.50,
would you keep on buying the 0.618 ? The bad news is that there is NO
priority rule, all levels are equally probable [this is the wrong use
of the statistics, 0.382 WAS perfect 3 months ago but 1.61 WAS true
gold 9 months ago etc etc].
Note also that we speak for emotional trading in front of 0.618 [with
0.382 AND 0.50 already false]. Is this 0.618 the only emotional
factor this specific day? Certainly not. Some INTC would announce
results [loosing -2.5% one h before the announcement...], some OPEC
meeting is ready to decide, your cash flow is not in the best
condition etc. I hope you know the situation and you will probably
agree with my hesitations.
Dimitris Tsokakis
--- In amibroker@xxxxxxxxxxxxxxx, "Ken Close" <closeks@xxxx> wrote:
> Dimitris:
>
>
>
> Hello: thanks for this unique code, innovative and interesting as
is
> most of your postings.
>
>
>
> I am not criticizing your observations but I would make my own
> observation that the reversal at D in your diagram is almost
exactly at
> the 0.618 retracement of the STRAIGHT support fib lines drawn from a
> bottom at you're a to the top at C. This does not in any way
invalidate
> your observations, and I myself would not make a buy on the day a
bar
> hits one of the fib ratios, but would it be possibly true that
hitting a
> more traditional "STRAIGHT" support fib retracement ratio could be
> considered a SETUP and then if the next x bars (say three) are up,
or a
> very short EMA of price turns up, then that could be confirmation
and
> one could enter then with more confidence?? Is it not a
possibility?
> Further, the weekly chart shows that the very same low is 38.2% fib
> retracement from the low on 5/2/2003 to the same "C" top on
4/15/2004.
> I believe it is "common" knowledge among those who use these setups
that
> the probabilities are higher when different time frame reversals
occur
> at common fib retracement levels.
>
>
>
> Thanks again for your innovative coding.
>
>
>
> Ken
>
>
>
> -----Original Message-----
> From: Dimitris Tsokakis [mailto:TSOKAKIS@x...]
> Sent: Saturday, June 12, 2004 11:58 AM
> To: amibroker@xxxxxxxxxxxxxxx
> Subject: [amibroker] Fib solutions vs the tough market decisions
>
>
>
> Many [and potential] foreign traders preferred the TokyoSE the last
> months.
>
> After a prolonged uptrend, the big boys [not the crowd !!] decided
to
> apply severe pressure [C]
>
> The index was loosing -2% or -3% or -5% without any serious
resistance.
>
> The tough question was the magnitude of the correction.
>
> Fibonacci buyers failed at all known levels.
>
> Although my innovative research was not posted this period, Oblique
Fib
> traders would also fail
>
> to catch the proper Buy level.
>
> This failure sounds somehow descriptive now but it could cost a lot
of
> money, because
>
> 1. 0.382 [negative]
>
> 2. 0.500 [negative again]
>
> 3. 0.618 [the great secret for many silent traders, but, negative
again]
>
> 4. 0.786 [many traders leave "the others" buy at 0.618 and come and
buy
> everything at the tricky 0.786 but, the market is negative again]
>
> 5. 1.000 [Well, there is no doubt we still have a bullish
environment,
> the market will react at this level, but, negative again]
>
> 6. 1.618[the situation is serious now, buy at this level is
equivalent
> to a bank guarantee etc etc]
>
> This is the most tragic case, IMO. These buyers still wait, the
market
> ignored their intension, the market
>
> was not interested for the color of their money, if they still want
to
> buy let us take now a +2% and a +2.4%
>
> and, if they forget these Fib stories, let them buy +5% higher. If
they
> do not agree, they will pay another +5%
>
> 3 days later, it is a free market, they may buy whenever they
want !!
>
> Since it is a real story and not a trade-fiction, I think I will
never
> place an order at any Fib level, horizontal
>
> or [the new] oblique.
>
> Dimitris Tsokakis
>
>
>
>
>
>
>
> Check AmiBroker web page at:
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