- the 3x2 fan line from the low seems to be the operative support resistance ratio.
- the stars mark where gold has been supported by the 3x2 line.
- gold dropped below the primary 3x2 line in April 2012 and declined to the 1st harmonic 3x2 below the primary 3x2--new support
- the latest rally found resistance at the primary 3x2--new resistance: a further sign of weakness.
- currently, gold is testing the harmonic 3x2 as it did earlier in the year. A break of this 3x2 harmonic would suggest lower prices--perhaps the next lower 3x2 harmonic.
- Check out the first 3x2 rectangle--prices were relatively nearby the bottom right corner. check out the second 3x2 box--once again prices were close to the bottom right corner.

## Friday, November 30, 2012

### Gold Weekly

Below is a weekly gold chart. The basis of the chart is the initial thrust from the 2008 low and January 2009 initial high pivot. Some observations.

### EURO-US$

Here is an example of the geometric technique by subscriber "Dolemite". His insights into markets is phenomenal...he has contributed greatly to the work I do.

Note the low @ 'X' where AF and BC intersect...and the top where AF and WY intersect.

Click here for Dolemite's updated chart

Note the low @ 'X' where AF and BC intersect...and the top where AF and WY intersect.

Click here for Dolemite's updated chart

## Thursday, November 29, 2012

### USDX Harmonics

I was recently asked to explain my charts and how I would use them as a trading tool.

The chart below of the US $ encapsulates pretty much what I look for in the squaring of a pivotal advance or decline. I hope this is somewhat coherent:

The chart below of the US $ encapsulates pretty much what I look for in the squaring of a pivotal advance or decline. I hope this is somewhat coherent:

- The entire geometric structure is based on the decline AB--which is used to form the square ABCD. It is hypothesized that all pivotal movements in markets are related to each other in a fractal nature...that the characteristics of significant pivot will effect the behavior of future market activity. In this example I use a previous decline and project the geometry forward. It is also effective to 'square' the first impulse wave of a trend..the first wave of this years advance in Feb-March 2012 would be an example of a rally that could be extended forward geometrically. If a projected decline and advance show signs of harmony this becomes an incredible powerful tool.
- The square is duplicated and extended out in price and time. Square CEIF is an example of the progression of square ABCD
- The next step is to take the diagonal of ABCD (DB) and form a square DBEF. The squares project forward in a geometric expansion based on the diagonal of each successive square forming the pattern 1, 1.414, 2, 2.828, 8......The squares are color coded on the chart.
- As the grid begins to take shape the corresponding harmonic angles are formed, such as 1x1, 2x1, 3x2, 1x2....
- In the chart below note what has happened at points C, F & I. Prices were near these intersections (corners of the primary red square. (time-price harmony). Points C,F & I were also at or near major pivots in the USDX chart. (Pt. C being an acceleration) Follow the path A-B-C-F-I-G. Where are prices at those points?
- D-F-G is providing support resistance while its 'root' A-C-I is also delineating support and resistance.
- Note the center points of each progressively larger square--what do prices do?
- Note BF || EG & BD || EF || HG

### SO what does this mean NOW?

- The USDX is entering an important time price harmonic--Pt. G) The market has progressed 3 primary (1.00) squares, 2 green (1.414)squares and 1 blue (2.00) square.
- Prices have touched the harmonic fan lines as they approached pt. G
- HG is proving support but EG (2.00 square) has been violated similar to the break in October. Resistance is formed by DG, AG, BG (root points of each progressive geometric square)
- If 80 is broken prices are likely to continue to decline, however the USDX could quickly rally to pt. G over the next few sessions to form another price-time harmonic. (represents a larger break than the October break in prices)
- A clear and decisive break above point G would support the case for higher prices ahead.
- A sharp rally to point G over the next few days would be pretty incredible to watch materialize.

- Assess portfolio for computation of risk-reward scenario to determine size of position (# of contracts based on acceptable loss amount (% of portfolio) to undertake. (money management is the most important aspect of trading)
- Monitor your favorite trading tools: RSI, MACD, Candles, Bollinger Bands.....
- Set up an execution plan--void of emotion--at stick to it.

### HOPE THIS HELPS

TRY THIS: Stare intently at the chart and visualize some of the three dimensional shapes. The patterns of the market will become significantly clearer. Picture the structure as a multi-faceted diamond.

## Monday, November 26, 2012

### S&P Update

### The Pebble Effect

#### H/T 'Dolemite'

The concentric circles are based on the decline AB. Note market behavior at arrows.The following radii were used.

AB, AC, AD...AH

#### Pebble Effect based on 1st wave off June 4th low: AB

## Friday, November 16, 2012

## Tuesday, November 13, 2012

### USDX

USDX

- all lines are based on advance AB
- CD is parallel to AB
- FE is parallel to BC
- BE is parallel to GC

## Monday, November 12, 2012

### S&P 500 Approaching an important trendline

### S&P 500

- squares based on AB (the first leg from the 2009 low)
- S&P has held above support provided by the 2x1 AE
- 1x1 BE intersects 2x1 AE at current price levels but time does not intersect until January 2013. ( possible time for a major low and end of intermediate cycle bear campaign)
- Note intersection of previous fan lines highlighted by arrows.

## Thursday, November 8, 2012

### S&P 500 Update

### Weekly Chart

geometric fan lines from October and June lows.

- 45* = 1pt:1day
- 36* = 0.726/day
- 30* = 0.577/day

- 180 : 1398.71
- 360 : 1324.91
- 540 : 1253.11
- 720 : 1183.32

### Daily Chart

- Square BCDF is based on AB. ( BC = AB)
- 2x1 from A is converging on 1x1 from B
- Circle radius CB is containing price levels since market broke CE (2x1)
- breaking below 1350 without a bounce would be very bearish and may lead to significantly lower prices sooner than later.

## Tuesday, November 6, 2012

## Thursday, November 1, 2012

### The Nifty 50

There have been several requests from Indian subscribers to do some geometry on the Nifty 50.
I have posted a weekly technical chart and a daily geometric chart. I will endeavor to make periodic updates on this market--which I think has INCREDIBLE growth potential long term.

The daily geometric chart does not 'fit' that well since none of the harmonic lines of the square are providing support-resistance or delineating pivot points...although the corner of the square (point C) was fairly close to the time period of the October high (natural time-price square). The bottom of the initial square (

Here is a harmonic based on the SQRT of 5 (2.236)

- diamonds are major pivots (and horizontal S&R levels)
- Market is retreating from a weekly RSI overbought level.
- breaking above the 'double resistance point' would be VERY bullish although a time-price correction is currently underway.

The daily geometric chart does not 'fit' that well since none of the harmonic lines of the square are providing support-resistance or delineating pivot points...although the corner of the square (point C) was fairly close to the time period of the October high (natural time-price square). The bottom of the initial square (

**green line BC**) seems to be the midpoint of the May-Oct rally. The parallel (red and green) lines should provide support and resistance.Here is a harmonic based on the SQRT of 5 (2.236)

- Triangles ABG and BDC are based on the rectangles formed from the 2x1 diagonal of square ABCF
- AG = 2.236xBG and BD = 2.236 CD
- The circles formed from radii AG and BD seems to resonate with price time patterns.

**Testing the 200 day moving averages.**
Labels:
gann,
geometrics,
india,
market geometry,
nifty 50

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