Answer to Isatrader

Splitlink said:

To answer your post on Procels's thread, I agree that a lot of people using the same point on a chart will give importance to that point. Whatever the point represents, be it a pivot, fib line, previous tops or bottoms it has no other significance to trading patterns.

So we get to a point that everyone is using (I think). That is a big decision, in itself and is the reason why R!, R2 and R3 lines exist, just in case the pivot does not work. Next, we have to decide which way to trade. Well? Which way is it going to go? Up or down?

Ah! We'll use a stop, just in case!

None of this makes rational sense. Fibs and pivots, averages are used because the trader needs an entry point and he does not want to work one out by himself. He has insufficient faith in his own judgement so he elects to trade with the mob, then he can lay the blame for being wrong on that and can come on to T2W with the certainty that he will not be alone.

This is a sloppy way to trade and is a recipe for failure. Far better, IMO, to enter where no one wants to be and, if it goes the wrong way, use a short stop and try again. The potential for a big win for low risk are much better.

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I think the Pivot point, R1, S1 etc would have relevance on products that have a lot of day traders like indexes mainly because a lot of traders are looking at them as potential support and resistance. They might not mean anything, but like Fibonacci levels, if traders use them then they have relevance if that makes sense.

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isatrader said:

Pivot points are not something I had looked before I read Porcels thread, but my point was the fact that day traders are watching them and devising scalping systems around them gives them some significance intraday as points of support and resistance, whether they mean anything in themselves or not.

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Splitlink said:

Procel's system gave me a couple of good trades last week but that's not enough to convince me. Yesterday, though, I was able to make a profit in the early rise. When I came back from a cuppa, there was a pin on the 30M piercing pivot R1 and telling me to short. I entered on reflex and because it looked right.

Naturally, I'll be watching his thread tomorrow! It's an interesting one.

PS. Yours is good, too! :clap:

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isatrader said:

Thanks Splitlink, you should join in my weekly competition thread one trade a week as is around 8 or us submitting a trade each weekend and then trading it on the thread during the week. Timescale is anything from intraday to the whole week.

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Splitlink said:

I'm not the world's best planner. Saying what I am going to do today, then having to wait until Thursday would drive my wife up the wall!

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