|
| For me, this is the key of NoDak's post:
"Imo, this fork is no longer valid. By that I mean, it gave us the probability of where price would pullback to within the downtrend"
For some reason it took me a very long time to figure that simple thing out. For the longest time I thought price was just supposed to bounce around inside the fork which of course makes very little sense.
In the fork you drew, once price formed the C pivot, it had a job to do and that was to go to the middle line. 80% chance.
It finally made it to the middle line. The usefulness of the fork is now greatly diminished.
That's not to say that after price does it's job on a fork, the fork is no longer useful. Sometimes, especially on multi-year forks, a line on the fork will become a line of balance. The fork you drew is on a long enough time frame that it is not out of the realm of possibility that one of those lines could be a form of balance for awhile. I haven't really studied it from that perspective so I'm not sure on this one.
So for me, the rules are:
1. Always use the continuous front month chart
2. Look at structure to determine the most significant pivots on the chart.
3. Draw forks or even just trend lines with those pivots looking for balance.
4. Also use the forks to determine where price will most likely form the next pivot or at least get an idea of where that may be.
The next thing I need to do is study different kinds of formations and I just have not had the time to do so thus far. | |
|
|
jpartner, frytown, nodak and other fork gents.
