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Let's try this. Think of varoius pivot series such as Fibonacci, Gann,
Astro, Square numbers, in a musical sense so that when a particular pivot
from a series is acknowledged by the market it is highly likely that another
pivot from the same series will be hit. So, one could test for when the
market does stop at a Fib retracement, what happens after that. To alway
expect Fib and test accordingly is like saying that all music is written in
the same key, which is obviously wrong. However, when one can recognized a
series of notes belonging to a particular key, one can make some very good
educated guesses as to which notes are likely to be hit. This is how I use
and think of pivot points.
Look for the pattern of the type of pivot points that are being respected by
the market from an important high or low and then see if that series is
carried forward in time. Market analysis is much like playing "Name That
Tune".
On another note <G>, one should allow a small slop factor or variance for
pivot points such as Fib. However, if that small coller of tolerance is
exceeded, it is my experience that this represents a crack in the structure
so that even if the market bounces off that level, it is highly likely that
the market will exceeed that level or at miniumun come back to further
cement that level at a later point in time. So, even when a market doesn't
work within given parameters, the market is talking to you and telling you
valuable information.
Musically,
Norman
----- Original Mes
sage -----
From: "Ira Tunik" <irat@xxxxxxxxx>
To: <realtraders@xxxxxxxxxxxxxxx>
Sent: Wednesday, April 17, 2002 10:19 AM
Subject: Re: [RT] FIBO DISCUSSIONS GOING OFF-LIST
> This argument seems to focus on whether fib numbers are right or wrong
most
> of the time. My question is, "What difference does it make?". One person
> can be right 95% of the time and lose money and another can be right 28%
of
> the time and make money. I remember many years ago a big name guru won a
> trading contest and after looking at his trades he lost on every trade
except
> one. He rode that one to the championship. It is not what you use to
trade,
> it is how you use it. If using fib numbers will make you money, use them.
> If they won't then get something that will. If you don't feel that they
will
> stand alone, find an indicator that will give you confirmation that your
> trade will be successful. There are systems that are very successful and
> based upon money management alone and become even more successful when you
> add a simple trend line. You really don't need to do statistical
analysis,
> years of back testing and fitting to make your answer come out. All you
need
> is something that you understand, and then using it properly. Will fib
> numbers work every time in the breading of rabbits? That is where the
> numbers came from. I don't think so. They may work the majority of the
time,
> but I doubt all of the time. The numbers work in art, but not all of the
> time. Is it like gravity, where it only works right in a vacuum? The
problem
> with most traders is that they use tools developed by others and have no
idea
> what they are supposed to show. They use crossovers to buy and sell when
> that wasn't the purpose of the indicator. So do your homework, understand
> the tools that you intend to use to trade with, and have a good money
> management system in place. Above all, don't be afraid to admit you are
> wrong. It happens all the time when you trade. Ira.
>
> bondo92677 wrote:
>
> > Like I said, you're obviously not a trader. So if you somehow prove
> > that fibos work 51% of the time it works but if it only works 49% of
> > the time it doesn't?
> > I've often seen the fibo retraces in a 2nd or B wave retrace act as a
> > spring board for huge moves. More often it doesn't. But if you have
> > the proper set-up and have other forms of analysis confirming the
> > time and price, the fibo level can be a high confidence trade. So if
> > you're wrong you got stopped out for a small loss. If you're right
> > it could be a huge money maker.
> > And who's says you're going to lose money if it works less than half
> > the time? what are you, an accountant?
> > Anyone who depends solely on fibo analysis would be a moron. You can
> > try to prove the fibo's statistical accuracy all you want and its not
> > going to make any difference. And as I already mentioned, I can come
> > up with an infinite number of fibo applications, so there's no point
> > in analyzing whether it works or doesn't work.
> >
> > --- In realtraders@xxxx, ztrader <ztrader@xxxx> wrote:
> > > On Monday, April 15, 2002, 8:29:58 PM, bondo92677 wrote:
> > >
> > > b> Just like everything else, it works and doesn't work.
> > >
> > > Yep - I was just trying to see if we could find the probability,
> > just
> > > like with anything else. Work/don't work is binary - I was just
> > trying
> > > to get a better measure, that's all.
> > >
> > > b> when you mention fibos, you're not only mentioning .618, .382,
> > > b> .236, .146 retracements but reciprocals, and roots and power
> > > b> levels. You can use fibos for extension targets, alternate wave
> > > b> comparisons, and time targets.
> > >
> > > OK, but I'm missing your point.
> > >
> > > b> If it worked you made money, if it didn't you lost a few tics.
> > >
> > > If the probability of 'working' is .05, you will soon be broke. :-)
> > >
> > > b> Show me something that works all the time and I'll be The
> > Amazing
> > > b> Randi.
> > >
> > > Ummmm.... I don't think anyone was asking for something that worked
> > > all the time. Can you point to a post that asks for that? A
> > probability
> > > doesn't mean it works all the time, as Vegas visitors know well. :-)
> > >
> > > ztrader
> >
> >
> > To unsubscribe from this group, send an email to:
> > realtraders-unsubscribe@xxxxxxxxxxxxxxx
> >
> >
> >
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http://docs.yahoo.com/info/terms/
>
>
>
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>
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>
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