Replies to post #512 on 123Tom's TA study group

[123tom]

you raise thoughtful points ,wildcard. about some different things. The exercise I did reconstructing ,back engineering a chart to see what it "Could have looked like IF a bullish rally had happened back then", like the chart was beginning to show ....in that window of time after a big Rally run from 50 to 1.45

That was the main point of my experimental exercise.

Regarding the idea that old resistance /support zones should not matter in the future.... I'm not sure about that. Thy always seem to matter. as the price flows and stops right there....too often to be called random.

The universe of buyers and sellers at any given price point is not just the handful of retail traders who buy and sell and get stopped out somewhere...the kind of market trading force that creates a Hard pivot point. or a whipsaw reversal.takes Big Money ,and HFT algorithms..

lets say also the MM game, ,centered around warrant structure and hedge funds,the big money players...seems to dominate , like with AVXL especially seems to center around the Big Money MM warrant structure.... 30 cents 45 cents 80 cents whatever the warrants are is it 50 cents? is it 1 dollar now? the time period when they expire, all these factors , (which I'm no expert on though I know I should be) these are very key to how price flows.

Technical traders will sell at a double and take the money. technical traders will buy a 50 % haircut as the waves pullback. a double bottom, many of these technical 'rules' have become ingrained over time, that self fulfilling idea elliott wave talks about. Elliott theory does use alot of the social psychology element. and I believe the concept. but I dont make that my central frame of mind. I tend to look more focused on the pure price action,using Fibonacci levels, as they combine with other tools like the 50ma/20ma, Bollinger bands, and within this picture I look at Elliott waves and candlesticks. and do this on many different time frame charts.

I'd have to also say, that while I'm drawing all this ,I also step back and keep an open mind that the whole exercise is just to see what the technical chart looks like, and the price action might or might not flow this way...Its a road map showing the target numbers. counting the elliott waves. looking at candlesticks. These tools have been used for centuries. Its mathematical, fractal, geometric, algorithmic, and now in the 21st century its High Frequency Super computer and government controlled.
Its a casino game. its fun to play. I wish I didnt have to use real money.

The open mind is always ready to stop using all these tools as soon as they demonstrate that they dont work anymore.
But they are still working really well it seems.