Technical analysis II
Support and resistance More in depth analysis
Many types of support and resistance
Significant pivots
Floor trader pivots
Fibonacci retracements
Trend lines
Pivots Turning point
Caused by a significant amount of buying or selling
Think about it: Do you and I have an account size to create that type of rally or drop?
So who is buying and selling?
Significant pivot points Previous day’s high/lows
Weekly highs/lows
Monthly highs/lows
Yearly highs/lows
Usually strong support/resistance levels
Look for a daily close beyond the support and resistance levels.
E.g. ES 2011 lows
Last week’s high/low
March high/low
Again consider this question:
Do you and I have an account size to create this type of move in the biggest equity index market in the world?
Floor trader pivots Pivot points that act like support and resistance levels
P=(H+L+C)/3
S1=P×2-H
S2=P-(H-L)
R1=P×2-L
R2=P+(H-L)
Fibonacci Retracement A term used in technical analysis that refers to areas of
support or resistance.
Horizontal lines
Trend Line A diagonal line between 2 or more price pivot points.
Up trend line can only be support
Down trend line can only be resistance