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I'm not sure if anyone else in interested in P&F charting. If anyone
has any objections, I'll take this thread private.
Sunny, I've been using P&F analysis as a tool and not as a system
in my trading since last 5 yrs or so ever since I read about
in the Richard Wyckoff book and then I read the A.W. Cohen's book.
As for your last question, the time period for the day trading
should still be the tick data (or atleast 1 min if tick is
not available).
The idea behind P&F analysis is to look at the price and IGNORE
the time element. So, the perfect data is the tick data which
represent each individual trade(s) happened at that price.
P&F charts also helps you in determining your stop losses easily
and also have sort of builtin price objectives which help you
lighten your position/tighten stop losses once those price objectives
are reached.
P&F charts have sort of a builtin moving stop loss method, you want
to stay 1 or 2 boxes below/above the last column on X/O. That works
very well for short term trading.
For S&P day trading, I was using a box of 1 with a reversal of 4
(yes, 4x and not usual 3x). For naz, I was using box of 5 with
reversal of 20 (again 4x). Incidently, those were also my initial
stop losses in dollar terms.
Thanks
Mudit
--- In realtraders@xxxxxxxxxxx, Sonnysark@xxxx wrote:
> In a message dated 12/04/2000 12:13:39 PM Pacific Standard Time,
> mwahal@xxxx writes:
>
> << Sonny,
>
> I do use point and figure charting for calculating
> market/sector/industry bullish percentage. I also look
> at P&F charts for determining the support and resistance
> levels, both short and long term as they are more clearer
> in P&F charts when I'm looking at a particular stock.
>
> I did use P&F charts for day trading sp00z and naz when
> I was day trading them. I was really amazed when the
> sp00z or naz will make a triple bottom and break on downside
> or when it'll make 3-top and run on upside. Both will be
> characterized by either a lower lows (for 3-bottom) or
> higher highs (for 3 -top). The visualiztion of breakouts
> is much clearer on P&F chart vs bar charts. But then again, its
> a lot subjective to the box size you use. One's 3-top may be
another
> guys 3-bottom :-)
>
> Thanks
>
> Mudit
>
> >>
> Thanks Mudit for commenting on P&F. It seems to me that price
action is
> indeed the best indicator, and P&F seems to be one of the best ways
to plot
> price action. Unfortunately P&F charting is overlooked by many.
The only
> dilemma is what box size, reversal amount, and time frame (if day
trading)
> should one use. This is subjective, and it leads one back to the
same
> problem one is faced when using an indicator.
> -Sonny-
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