[BlowFish]

There are some gems here and there. Take a look at some of DB's posts the blog and Wyckoff corner are well indexed so no need to trawl through stuff thats not of interest. Thalestraders posts are very good and as a relatively new member there are not millions to wade through. There was a thread in the forex section something along the lines of 'a busy day tomorrow' that had some very good stuff in.

[forrestang]

Originally Posted by thalestrader »

I've been planning just such a thread. I am working on an opening post to help serve to organize the thread's objectives. Many of the pertinent points that I will include in the opening post have been shared here in this excellent thread.

If no one objects to such a thread, I will get an opening post posted to TL this weekend. I would hope that other S/R traders, whether they swing for the day or swing for the long pull, would share some of their analysis.

Best Wishes,

Thales

Just as a note, I wasn't trying to be cute, I was serious and I would personally LOVE to see such a thread! I would subscribe and participate in it.

It would be great if the thread was along the lines of this here Al Brooks thread, and contains real world practical examples day to day that everyone can relate to.

[DbPhoenix]

Originally Posted by forrestang »

What would be great and beneficial to many (myself included) would be for someone with knowledge on the subject to post a thread about how to trade Support and Resistance.

There are plenty of threads here on the subject, but they are all mostly academic. I have searched for one for some time that is packed full of actual, trades taken based on S/R. They are sprinkled throughout, but there really isn't one EXCELLENT thread about it with many ACTUAL REAL EXAMPLES.

Like a good book, the posts could have a beginning, a middle and a end.

Like, "I picked this support level from (insert time) because I saw (insert rationale here), I then saw price approach this level, and entered (insert entry criteria here and price upon entry) here, and I exited because of (insert exit criteria here)."

I'm sure there are many that could post actual daily charts on WHY they found various levels significant, and WHY they entered trades based upon them, and more specifically HOW they entered the trade. Similar to this thread where there are charts posted everyday, which is probably why it has gotten so much attention?

There are thousands of hindsight charts posted throughout TL that will tell you exactly how the trader allegedly traded whatever it was, but how is that going to do you any good (and if those postings were to do you any good, they would have)? Far more important is to locate support and resistance in advance, then determine in advance how you're going to trade it. Finding support and resistance after the fact is useless except for the "learning experience", as is determining afterward how you would have traded it.

Why not determine today, after 1600 or so, what the support and resistance levels are for whatever it is you're trading, then post where you plan to enter and exit tomorrow if and when price reaches those levels, stops and all? Otherwise, it's just more shouldawouldacoulda.

[DbPhoenix]

Originally Posted by thalestrader »

I do not feel comfortable organizing my trading activity around rules. Rules imply rigidity and universality and absolutes. Rules make it difficult to respond to the particular case. Rules have their place with respect to risk management. But price does not know any rules any trader may dream up. Price action won't follow your rules. You must follow price action.

If I may offer an example, the "Third Time's the Charm" setup, which is a classic example of the difference between following a setup and trading price action.

The TTTC setup came about because somebody noticed that price, after testing a certain level twice, would often break through that level after a third test. The fact that price often broke through the level after only two tests or on the fourth or fifth or tenth or failed to break through at all and instead reversed was pretty much ignored. TTTC sounded good.

But what in terms of price action is going on here? Price tests, say, R. Buyers are turned back because sellers aren't done. So buyers regroup and try again, buying up more of what sellers have to offer. But the sellers aren't done, so price is turned back yet again.

But buyers aren't done yet. They regroup yet again for another try. This time, however, when they reach R, they find that sellers have pretty much sold what they wanted to sell, making the "breakout" not only possible but relatively easy (which is why low "volume" often accompanies such breakouts).

But does the "third time" have anything to do with it? Of course not. It may take four tries. Or five. The success of the breakout will depend entirely on how much supply buyers are willing and able to absorb and how much supply sellers want to hand off. If buyers just can't absorb what sellers want to sell, they're turned back, and you have a reversal.

So how do you know what to do in real time in this situation? You work with people who are trading whatever it is you're trading in real time. If you can't follow it in real time, much less trade it in real time, then all the rules and chart examples and setups on the planet aren't going to be of much help. You guys have a room set up for this purpose. It's up to you to make use of it and learn from it.

[BlowFish]

Originally Posted by DbPhoenix »

There are thousands of hindsight charts posted throughout TL that will tell you exactly how the trader allegedly traded whatever it was, but how is that going to do you any good (and if those postings were to do you any good, they would have)? Far more important is to locate support and resistance in advance, then determine in advance how you're going to trade it. Finding support and resistance after the fact is useless except for the "learning experience", as is determining afterward how you would have traded it.

Why not determine today, after 1600 or so, what the support and resistance levels are for whatever it is you're trading, then post where you plan to enter and exit tomorrow if and when price reaches those levels, stops and all? Otherwise, it's just more shouldawouldacoulda.

Thats the beauty of S/R its all done the night/week/month before, absolutely no excuse not to post lines/zones that you are going to work off in advance.

I think its a great idea for a thread. If people want to talk about how they might trade or coulda shoulda woulda traded, thats OK. But the lines should be fresh.

[forrestang]

Originally Posted by DbPhoenix »

There are thousands of hindsight charts posted throughout TL that will tell you exactly how the trader allegedly traded whatever it was, but how is that going to do you any good (and if those postings were to do you any good, they would have)? Far more important is to locate support and resistance in advance, then determine in advance how you're going to trade it. Finding support and resistance after the fact is useless except for the "learning experience", as is determining afterward how you would have traded it.

Why not determine today, after 1600 or so, what the support and resistance levels are for whatever it is you're trading, then post where you plan to enter and exit tomorrow if and when price reaches those levels, stops and all? Otherwise, it's just more shouldawouldacoulda.

I suppose seeing ANY chart in hindsight is simply how someone would have allegedly traded something? That's just a variable we can't control.

But seeing these actual examples is what I think will help those of us interested in the topic. As I mentioned earlier, a complete picture of the logic behind a trade would be helpful.

For example, when I was trying to trade mainly based off S/R (this was on another forum), I would post the levels I had on my chart BEFOREHAND(see two pictures below, these are old levels so ignore the actual numbers), so all my levels were always cataloged. When I would post my examples, I would base my trades off these levels, and explain my rationale behind entry and exit for example.

So it's not that I have not attempted to trade this way before, its simply that I wasn't able to make sense of HOW to properly trade this way. I think examples of HOW others that are successful at this would be helpful to those interested in it.

[DbPhoenix]

Originally Posted by forrestang »

I suppose seeing ANY chart in hindsight is simply how someone would have allegedly traded something? That's just a variable we can't control.

But seeing these actual examples is what I think will help those of us interested in the topic. As I mentioned earlier, a complete picture of the logic behind a trade would be helpful.

For example, when I was trying to trade mainly based off S/R (this was on another forum), I would post the levels I had on my chart BEFOREHAND(see two pictures below, these are old levels so ignore the actual numbers), so all my levels were always cataloged. When I would post my examples, I would base my trades off these levels, and explain my rationale behind entry and exit for example.

So it's not that I have not attempted to trade this way before, its simply that I wasn't able to make sense of HOW to properly trade this way. I think examples of HOW others that are successful at this would be helpful to those interested in it.

But other than "here are my pivots" (which is cautionary right there), you don't explain what all these lines are or where they came from. Therefore, it's next to impossible to determine whether they are genuine S/R or just lines.

For example, price drops off the bottom of your screen and after some time works its way back. Why? Where did it reverse? Was there support down there? Clearly there was or price wouldn't have reversed. But where was it, and why? Beyond that you have to decide how much risk you're willing to assume, what your target is, what signs of trouble you're going to look for that may signal that your target isn't going to be reached, etc, etc, etc. If you want buy here, put stop there, exit up there, it's unlikely that there will be enough hindsight charts to help you. Doing this in real time will more likely be of much greater help, but there are only three people in your room. How come?

[forrestang]

Originally Posted by DbPhoenix »

But other than "here are my pivots" (which is cautionary right there), you don't explain what all these lines are or where they came from. Therefore, it's next to impossible to determine whether they are genuine S/R or just lines.

For example, price drops off the bottom of your screen and after some time works its way back. Why? Where did it reverse? Was there support down there? Clearly there was or price wouldn't have reversed. But where was it, and why? Beyond that you have to decide how much risk you're willing to assume, what your target is, what signs of trouble you're going to look for that may signal that your target isn't going to be reached, etc, etc, etc. If you want buy here, put stop there, exit up there, it's unlikely that there will be enough hindsight charts to help you. Doing this in real time will more likely be of much greater help, but there are only three people in your room. How come?

Oh boy....

The picture that you see is truncated. It does not contain the entire picture that was in the post. I literally just used snagit to capture a picture of what I was doing (just now to explain it to you). I was not able to capture the entire picture. So let me explain.......

I created a post, on that forum, where we could all post our significant levels, and WHY we thought they were significant. Each day it was updated. So what you saw was the latest levels that I had either added, or dismissed, FOR THAT DAY.... 4-11-09. I.e. if I had a level that I explained from a week ago, it was STILL level, I didn't re-explain it if nothing had changed.

----edit----
The Picture that you see, usually was only relevant to the new levels. So if I had levels from weeks back, and price was waaay away from it, I wouldn't try to fit levels in the picture that had already been explained, that's just not reasonable and it's too time consuming. But if for example I had a new level from the day prior, I would post a picture of what price had done in that area, and add it to the levels. Does that make sense?