Friday, May 19, 2017 1:12:52 PM
Correcting $SPX Fork Error
While playing with forks, I debated with myself whether to use the tops of price trends to place the fork handle or whether to use the bottoms of price trends to place the handle. It seemed 50:50 as to which to choose. Then this morning I finally saw the light. I decided that when testing resistance to go higher (especially when making all-time new highs), the handle ought to be placed across the tops of price patterns instead of the bottoms because resistance to going higher is obviously going to be much stronger than resistance to falling back. In my original fork placements, I did that with the declining orange fork but not with the inclining blue fork -- maybe I had some subconscious desire for the market to go higher (while my conscious thoughts favored it going lower, to more easily stay within the horizontal channel). So this morning I changed the blue fork as shown below. Now both forks are set with the same basic concept.
The original position of the blue fork handle is shown by the arrow (and a shaded version of the original handle placement). I’m not showing the original position of the blue tines because that would clutter the image too much. With the original blue fork, the bottom yesterday aligned very well with the center tine of the orange fork but did not align at all with the bottom tine of the original blue fork (the reversal happened significantly below the bottom tine of that fork). Now, everything fits very well with the modified blue fork, and yesterday's low aligns with the crossover of tines on each fork.
While playing with forks, I debated with myself whether to use the tops of price trends to place the fork handle or whether to use the bottoms of price trends to place the handle. It seemed 50:50 as to which to choose. Then this morning I finally saw the light. I decided that when testing resistance to go higher (especially when making all-time new highs), the handle ought to be placed across the tops of price patterns instead of the bottoms because resistance to going higher is obviously going to be much stronger than resistance to falling back. In my original fork placements, I did that with the declining orange fork but not with the inclining blue fork -- maybe I had some subconscious desire for the market to go higher (while my conscious thoughts favored it going lower, to more easily stay within the horizontal channel). So this morning I changed the blue fork as shown below. Now both forks are set with the same basic concept.
The original position of the blue fork handle is shown by the arrow (and a shaded version of the original handle placement). I’m not showing the original position of the blue tines because that would clutter the image too much. With the original blue fork, the bottom yesterday aligned very well with the center tine of the orange fork but did not align at all with the bottom tine of the original blue fork (the reversal happened significantly below the bottom tine of that fork). Now, everything fits very well with the modified blue fork, and yesterday's low aligns with the crossover of tines on each fork.
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