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Here is another example of how I use the Midas technique in trading the OEX.
In an uptrend the start points are selected where price accelerates upward
from a previous support line. These bars are 30 minute bars so the support
and resistance values will change a bit on Monday as the bars develop.
Support on Friday was found at the Dark Green line after failing to hold
support at the red line. Resistance is now at the redline and if that
doesn't hold then expect it at the upper light green line. If S1 does not
hold support then S2 at 713.06 should be tested. If S2 fails, then
somewhere between 695 and 700 would be the target as the yellow line will be
rising.
R2 = 721.42
R1 = 720.36
S1 = 716.43
S2 = 713.06
S3 = 695.15
Interestingly, the Keyline or Classical pivot for Monday is 720.66 based on
the (H+L+C)/3 formula displayed on the Probability Cone chart. Also the
Odds Cone has an average correction level to 713 inside the green cone
whichis S1 using the Midas approach. If that fails and a stronger
correction occurs, then a drop to between 705 and 709 on the red cones would
be expected. If that fails to hold then we get to the "crash" mode level of
700 which only occurs 3% to 5% of the time.
Bob Roeske
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