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At 08:44 PM 16/01/98 -0600, you wrote:
>To James in LA,
>
>SuperCharts & TradeStation provide a Support/Resistance indicator. The
>icon looks like a set of horizontal lines.
>snip
>Find the a low Pivot Point on your chart and drag to the High Pivot Point.
>See the fits? Who were the fools that said that stocks follow a random
>walk?
>snip
SuperCharts not only has Support/Resistance (speed lines) which can
be defined with Fib. numbers, but also has a Fib. Time Cycle icon for Fib.
dates. Additionally, the fan and arc indicators can be defined using Fib.
numbers. Personally, I also set the 3 line moving averages to a Fib.
series. Various other indicators can probably also be set up along the same
principles.
Do a help search in SuperCharts for "Cycle-Fibonacci" for a very
sparse explanation.
Questions: Although I am amazed at the results using the Time Lines
and Resistance Lines (and MA3), I can't get the Arc and Fan indicators to
show me much. My problem with all of them is that I am fiddling around with
out any knowledge of the "rules". To get the best fit, I set up the
indicators, sometimes from on low PP and high PP, sometimes on broad bands,
sometimes on the small band which seems to have allowed the slower MA's to
"catch up" and cross over. In short, I fiddle around 'til I see strong
correlation to earlier movements, crossovers and even volume surges, and
then look to the right of the chart to be amazed. What are the "rules"
(assuming there are any!!)?
Further, I am studying futures and the contract activity is thin and
jumps around at the beginning of the contract. Sometimes, once the bars
"firm up" the overall time span is not really long enough for the higher
numbered lines to fall on the chart at all. And, what about the key moves,
say between 21 and 34?
The next problem is projecting, i.e. off the chart. Must I count
the days without the aid of the lines? If I want to know about shorter term
projections from where do I start my count (or overlay another set of
lines)? Do I start numbering over at that point with 1, or 3, or 5, or . . .?
Is there some way to correlate the projections for Monthly, Weekly
and Daily studies?
And finally, how can I apply this to trading options? On the short
term I "feel" like I can get some idea of whether the projected move will be
bearish or bullish and perhaps even to what price level. However, for short
term moves it doesn't seem worth paying the time premium on an option. Net,
how can you project the price for a longer term perspective, 90-150 days,
for instance?
Enough for now!
Thanks,
Asher Landesman
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