THT
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Some big picture stuff for you to digest
I doubt many people look at monthly chart - this post will cover cycles, using Indicators, moving averages etc
If you have a method and it works, it works! end of story - stick with it, humans are very critical and jealous people - its why I don't tolerate people and its the reason why I will never get involved in the Industry, sell anything or write courses/books - I can just imagine the interactions!
Right, We want to read a market - some markets are just hard to read, so guess what? We just avoid trying to do so and look for something easier
LSE:WPP - MONTHLY chart
What do you see?
Anything else?
Well we can use TIMING and CYCLES
We can see that roughly every 4.5-6 YEARS this stock has a significant LOW and from that LOW, price advances for 2-8 years, so you'll have to monitor and adjust accordingly you can see you can't just buy and hold
We are right now in that ZONE
Will it work? we do not know for certain - BUT what we DO know is that a huge amount of TECHNICAL ANALYSIS is alerting us to this market being at or near a possible low point at some point in the next few months - one for the old watchlist I think!
So what you do is reverse engineer what this market HAS AND NEEDS to DO in order to CONFIRM the thinking - and you do that by going back to the past few instances and SEEING what price did on the WEEKLY, DAILY and HOURLY charts at those reversal points - if this market does similar then its a ultra high probability signal to which you can trade/INVEST
Is it guaranteed to work? - HELL NO, its ultra high probability, but that's not a 100% - We don't know for certain the CYCLE low is happening now, it could be happening in a few months time!
We will KNOW that the cycle low is in once PRICE regains the 12SMA on the monthly chart - that MEANS on the daily and weekly prices WILL HAVE TO BOUNCE and if it works out, then if we can get in at £3-4 range, we can see that any such bounce could quite easily get to £6+ which gives us a nice potential % return
If its NOT clear within 1 minute of looking at a chart - move on until you find one that is clear, then work out a plan of action
I doubt many people look at monthly chart - this post will cover cycles, using Indicators, moving averages etc
If you have a method and it works, it works! end of story - stick with it, humans are very critical and jealous people - its why I don't tolerate people and its the reason why I will never get involved in the Industry, sell anything or write courses/books - I can just imagine the interactions!
Right, We want to read a market - some markets are just hard to read, so guess what? We just avoid trying to do so and look for something easier
LSE:WPP - MONTHLY chart
What do you see?
- Well we see the history of the stock
- We can see how the moving averages worked
- We can see price v Indicators
- We can see the times when price surged and when it didn't do much
- Double bottoms?
- When things are bullish is price generally above or below the 12 simple moving average? I only use 12 as its a year look back on this chart
- When things are bad where's price in relation to a moving average?
- Look at the ANGLE/SLOPE of the moving averages - notice what they do in tepid moves, steep moves etc
- Also notice that once these moving averages get into PERFECT ORDER on a MONTHLY - they tend to remain in perfect order for MONTHS/YEARS! This allows you to BUY the DIP or SELL the RALLY pretty damn effectively or the BREAKOUT
- Can you start to see why I use them?
- Last few years? What a mess!!!! That usually means you can SHORT the stock and it hasn't failed
- What about the 12RSI?
- Well Notice the levels it typically finds during the UP trends (tends to be 50%+ finding support around that level) and during the DOWN trends it struggles to regain the 50% level, remaining under it and finds bear market LOWS under 30%) - don't worry about bounce from such support you can trade the lower time-frames to catch those - the Important thing is you can SEE with visual evidence that the 12RSI does as I am saying
- What about right now - what do you see?
- BEAR market - Indicators are in the zone for a REVERSAL - that does not mean its going to happen tomorrow!
- We have price right now broken a key level, this could be a Gann Lost Motion over-run from which we will get a bounce OR
- price could descend further to create a TRIPLE BOTTOM (this is my preferred option) from which we'll get a bounce
- I'm not sure on what any bounce will do, the mechanics of this market could for the next few years just form a trading range, or it could bounce up back to the £12 or higher level or it might not do any of that
- You then drop down to the weekly and daily to time any such possible low - I'm not showing that here
- This is why I "clutter" my charts - They ALL have a use, that I want to SEE (I'm a visual person) as soon as I bring up the chart
- It takes me about 10 seconds to be able to read a chart position and history
Anything else?
Well we can use TIMING and CYCLES
We can see that roughly every 4.5-6 YEARS this stock has a significant LOW and from that LOW, price advances for 2-8 years, so you'll have to monitor and adjust accordingly you can see you can't just buy and hold
We are right now in that ZONE
Will it work? we do not know for certain - BUT what we DO know is that a huge amount of TECHNICAL ANALYSIS is alerting us to this market being at or near a possible low point at some point in the next few months - one for the old watchlist I think!
So what you do is reverse engineer what this market HAS AND NEEDS to DO in order to CONFIRM the thinking - and you do that by going back to the past few instances and SEEING what price did on the WEEKLY, DAILY and HOURLY charts at those reversal points - if this market does similar then its a ultra high probability signal to which you can trade/INVEST
Is it guaranteed to work? - HELL NO, its ultra high probability, but that's not a 100% - We don't know for certain the CYCLE low is happening now, it could be happening in a few months time!
We will KNOW that the cycle low is in once PRICE regains the 12SMA on the monthly chart - that MEANS on the daily and weekly prices WILL HAVE TO BOUNCE and if it works out, then if we can get in at £3-4 range, we can see that any such bounce could quite easily get to £6+ which gives us a nice potential % return
If its NOT clear within 1 minute of looking at a chart - move on until you find one that is clear, then work out a plan of action
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