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apparently NOT, because we traded down to 1998.50, this evening. luckily i held onto 30 shorts, but what i should have done, is kept my entire package. all these approaches play into the powerful human tendencies that induce one to get out of profitable trades too early. it's always tempting to liquidate a good trade for some arbitrary reason. i doubt there are many traders on this forum who consistently take more that a few points out of any given trade, because there is always going to be some line, s&r level, or fib, that will provide them with the requisite rationale or excuse to get out of a winner, before (god forbid) it turns into a scratch or loser.
Indeed I do, facts of all sorts, even though I still don't believe in electricity because I can't see it.
Trivial facts such as why anchors might be functional or emotional, why a story is made up of acts and a plot and not just a handful of sentences, and why the volume of money in and out through MOC orders from hundreds of millions of investors and funds who couldn't spell 'fib' might make the notion of self-fulfilling prophecies from a few thousand traders watching lines nonsense.
I'm happy to concede there are many more important things to being a trader than lines on a chart, anybody's lines in fact.
Very interesting thread to read through. To not miss out, I will share my newbie opinion in this topic.
In my opinion markets consist of nothing but us traders. Though we trade in different forms and size but traders will comes downs to buyers and sellers, who verse each others in the tug of war pulling (or pushing) the prices in their favour. The interesting part of this particular tug of war game is that you can switch side when you see the a few new big guys joins the opposing side (or when you see your team-mates gets tired). Of course one will get paid a loyalty premium the longer he/she stayed on one side if that side ended up winning. Meanwhile different indicators are tools to provide an "edge" to each individual players so they can figure how which side has more potential to win. One also try to predict when will other players switch side/joins the game by looking at their reason of participation.
What I'm simply suggesting is the market works in self-fulfilling prophecies, market cares what traders care. If by the
poll has almost 50% people voted yes to support Fib then it will have its ground. Of course this poll can be biased as the size/successfulness of the voters as a trader is hidden. And by the overwhelmingly tone of the against side to Fib esp for the big dogs, I do believe the skewness exist.
Nevertheless I feel the need to keep of open mind for everything, doesn't matter how or why, of what other traders care. It might just become our edge.
Prob not the greatest metaphor but out of many trading comparison senarios I have yet to seen tug of war so I think I will use it here.
Nobody is 'defending' a tool, only discussing merits and failings, of which there are many of both, and nobody has said that fibs can make a trader, they can't. Your point is well understood - real trading only occurs at the right hand edge, and that's true of every chart that has ever been posted, not just fib based ones.
I'd be the first to put my hand up and say it's damn difficult even on a good day. I was successful on Dax today - did Leonardo and Elliott help me? I'm not sure. Were they there? Hell yes.
I do not trade with Fibs, because I don't know how to do it and make a profit. However, I continually see pull backs to fib levels every day, where price has taken off and continue the previous momentum move, after a corrective pull back.
Here is one from today.
I am sure @srgtroy will choke on his coffee when he sees this.
I had written a first response to this post. It seems that it has disappeared somewhere in the vastness of the internet. I still have the screenshots that I had prepared, so I will post them again.
I think that the main question is the question which timeframe you trade. For anyone who does not wish to hold a position over the week-end Friday's exit was a good one. Prices were below the daily, weekly & montly 2SD bands (VWAP). The market was extremely oversold in different timeframes. Under those circumstances a multiple Fibonacci lines looks like a fair exit to me.
So price made it up through that major confluence at 2038-2040 to 2050. My expectation would be a pullback/retest of the confluence around 2038-40 which should represent a good place to try to get in on a long assuming price action cooperates. Let's see if that works...