I am demonstrating how to calculate trend using a simple methodology that I call "Time at Mode". It is a simple, bar-by-bar analysis that logically deduces how to calculate the trend in a very mathematical way that can help you in your trading/investing/thinking/understanding about charts.
The building blocks of an uptrend is a new high. If you don't see a new high in 5-bars, then you can start a downtrend from the highest high in the last 5-bars. If you go 5-bars without a new low, you can start a new uptrend from the lowest low of the past 5-bars. It really is that simple.
Once you get a new high, the recent downtrend has failed and you are in an uptrend. You can make calculations of how far the market will move based on how far the market traded around the "mode" or the "most frequent price" of the uptrend. Measure around the mode and project up from the mode. Once time and price targets have passed, then you can wait and see if another higher mode forms which can give you a new upside projection.
Once you see 20 bars at one price, the market is not operating at that time frame, so you go UP by 4x-6x (from daily to weekly, from weekly to monthly, from 65 minute charts to daily) to the next time frame.
There are very few additional rules to help you apply these "basic building block rules" for calculating trend.
We discuss charts with this analysis in mind in the chat room here called "KEY HIDDEN LEVELS"
What we see here in XAGUSD is that the current downtrend was close to failing at today's high. The last two sharp moves down created a "Range Expansion" bar where it declined by more than the previous bar's range, implying strong selling and more downside to come. But two times (see highlighted "Downside Range Exp FAILED" callout boxes on the chart) these downside moves failed to lead to follow through. So, there are 3 uptrends in place and 1 downtrend. If we go over the high, there will be 4 uptrends in place and no downtrends and the trend could accelerate. That is just a guess, but we are watching what is happening and see that the sellers are weak and the buyers are in control.
Follow this post to see how it pans out. Only time will tell.
Tim
12:43PM EST 10/23/2015 XAUUSD 15.831 last
評論
timwest
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Note the "Double Diagonal Triangle Bottom in September" for silver...
IvanLabrie
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Beautiful!
Victor.Y.F
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Thank you Sir, this is really gold.
timwest
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If others would post trades using the same methodology, we could form a trading team.
timwest
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If silver is up on the day, do consider getting on board. It may take a few times to get it right, but I think it will be worth it.
I believe this market is ripe for a move based on the heavy monetary easing that has been expressed by Mario Draghi and also by China with their rate cut. And back in the USA, sentiment has swung from expecting a rate hike in 2015 to then seeing rate cuts overseas. Given that easing environment, it would be normal to expect a substantial rally from the precious metals here. Rallies in the metals that occur quickly do not tend to last, so I will just keep monitoring for low-risk entries.
If we keep analyzing the movements (the building blocks I have mentioned, which is how each range stacks up next the range before it) we can identify the lowest risk, highest reward opportunities.
IvanLabrie
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Excellent idea Tim.
I like this a lot, I think we'll see big rallies in risk on assets and gold and silver. (and NZD)
timwest
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Silver is acting strong this morning. When I wrote my last comment, Silver was up 3 cents. Here were are now up 16 cents. The momentum is going in the direction for this trade to trigger an acceleration to the upside. It looks like silver has made it past the times in the past when it gets sold off sharply to trip out the stops of any weak longs. The conclusion:? There aren't any weak longs. The old saying comes to mind: "If it looks like a duck, acts like a duck and quacks like a duck, it most likely is a duck."
look4edge
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Yep, strong, nevertehless retraced just .618 of hard trendlline rejection, bullish (strong) only above 16.1/16.2
timwest
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The longer this silver holds up here, the more it is clearing out sellers and revealing that buyers are lining up to load up on silver. Time will tell.
Victor.Y.F
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Great idea! Thank you Tim! I like eat ducks... ... ^^