RE: [RT] Pivotal Music, Noise, and other Musings`

["Lee Morris" <LMorris@xxxxxxxxxx>]

<FONT face=Arial color=#0000ff 
size=2>Norman, good analogy and well said

  <FONT face=Tahoma 
  size=2>-----Original Message-----From: Norman Winski 
  [mailto:nwinski@xxxxxxxxxxxxxxx]Sent: Thursday, April 18, 2002 1:24 
  PMTo: realtraders@xxxxxxxxxxxxxxxSubject: [RT] Pivotal 
  Music, Noise, and other Musings`
  RT,
   
     You may remember my musical analogy 
  post in regard to Fibonacci and other pivot points? 
  Let's now think of the market as an instrument, 
  such as a violin,  with no specifics pre-ordained notes. One can only 
  play the notes designated by a piano's keys whearas on a violin anything 
  within its range is possible. The violin model teaches us that when one hits a 
  note that is within the parameters of a given musical key we may have music, 
  but this is only one minimum requirement. In contrast, one can also play 
  in areas that is not harmonically in line with what we think of as music and 
  this is usually thought of as noise. The critics of Fibonacci and other pivot 
  points argue that when continually looking for these harmonic points, they are 
  often not found.  I counter that the market is not always playing 
  "music".  Fibonacci represents a specific musical key. What I would call 
  market music is what Elliott Wavers usually call an impulse wave. Elliott 
  wavers also call non-impluse waves corrective waves and and some of these can 
  probably be classfied as market noise. Noise occurs when there is a lack of 
  order and a total disregard for order and harmonics. When I notice the market 
  disregarding projected important Fib levels, it will often see saw back and 
  forth across these harmoics levels, thumbing its nose at the key levels, and 
  then I know there is a good probability that the market is in a noisey mode 
  and that a major trend is not likely.  This last point gives valuable 
  trading information that can save a traders thousands of dollars. Under these 
  conditions, forget about being a trend trader or trying to use stops for 
  specific levels. Chances are that you will be stopped out only to then see the 
  market move in the direction you anticipated.  Remember, this is noise 
  and during the noise phase, if you wait long enough, the market will probably 
  play your "note"..  
   
   Now in contrast to the noise mode, take a 
  moment to think of a famous piece of music and in your head only play the 
  first few notes and stop, such as Beethovan's 5th Symphony. 
  Da da da ..........    I bet you 
  can forecast the next note.   Such is music and such is what market 
  analysis and forecasting aspires to achieve. 
   
  Musically,
   
  Norman  
   
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