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----- Original Message -----
<DIV
style="BACKGROUND: #e4e4e4; FONT: 10pt arial; font-color: black">From:
ztrader
To: <A title=realtraders@xxxxxxxxxxxxxxx
href="mailto:realtraders@xxxxxxxxxxxxxxx";>realtraders@xxxxxxxxxxxxxxx
Sent: Saturday, April 13, 2002 1:34
PM
Subject: Re[4]: [RT] Fibo
predictions
On Thursday, April 11, 2002, 9:09:50 PM, Neal Hughes
wrote:>>(1) Fibs contribute a small but 'fixed' probability, but
the overall>>probability is improved by confluence with other
indicators, orNH> I'm saying that Confluence of Fibonacci levels
dramatically increasesNH> the likelihood that price will turn at that
level.>>(2) Fibs have a conditional (and variable) probability
that varies>>according to other 'market conditions'?NH>
Well, Fib support will more likely "hold" in a retracement of anNH>
up-trend, than it would if there were a strong down-trend.Actually, I
was asking a slightly different question. Imagine, if youwill, a graph of
probability vs time where the line is flat, thusindicating a constant
probability as a function of time. This is whatI was alluding to in (1)
above. In this case a certain Fib always hasthe same reliability,
independent of the 'market conditions'. A'signal' occurs when multiple
Fibs coincide in price. Several'smaller' probabilites occur
together.Then, imagine a graph in which the probability goes up and
down withtime - not a flat line, but a curve. This is case (2). In case
(2), Iwas asking if the ups and downs are caused by, or related to,
certain'market conditions'? For example, do the Fibs seem to work
better(higher probability) when the market is in a trend vs in
congestion?In this case a certain Fib can have a different reliability
atdifferent times.One reason this is important is that in case (1)
confluence is'necessary', but in case (2), it is not, and a single Fib can
beconsidered as independent. This affects how it is analyzed and how
itmight be used.NH> Confluence to me is a specific term defined
as an area whereNH> multiple Fib levels coincide.NH> I also
use other indicators to fine-tune and trigger the trade.NH> But not in
a way that I would call Confluence. For example,NH> Fibonacci would be
predicting (in advance of market action) aNH> possible turning point. I
wait for another indicator (MACD) toNH> prove that the market is
turning (lagging indicator, showing aNH> turn AFTER market
action).Are you thinking that confluence is associated with Fibs only?
Couldit be extended to any coincidence of indicators?
As long as the indicators are
truely different (e.g., velocity vs acceleration,
etc.).ztrader------------------------
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