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Support and Resistance

One week ago I received a couple of emails questioning whether or not I believe in support and resistance. In fact, one subscriber said if I didn't believe in support and resistance, then I couldn't possibly believe in trend! Why? Because in all cases the situation ends.

Here's what I believe: The trend is your friend until the end. The swing is the thing until it goes "ding."

What is support and what is resistance? Are those not simply convenient terms to describe an area of fair value? Prices bounce off of those areas of so-called support and they bounce off of areas of so-called resistance. Why? Because temporarily no one is willing to sell for less than "support" and no one is willing to pay more than "resistance." "Support" and "resistance" are equally as mythological as "trend." Why do I say that?

Every market is in a trading range between the highest price it ever achieved (resistance) and the lowest price it ever reached (support). So what is all that stuff in-between? Can we call the junk in between "support" and "resistance?" What are trends and swings? Are they not simply connectors connecting the temporary areas of fair value? So-called support areas fail to support, are broken, and are connected to a lower fair value area by a swing or trend. So-called resistance areas fail to resist, are broken, and are connected to a higher fair value area by a swing or trend.

Trend lines and swing lines are also broken, and lead to areas of fair value, where prices chop sideways for awhile. So, what's the bottom line of all this clap-trap about support, resistance, swings, and trends?

As far as I'm concerned, the only thing that counts is whether or not you have found a way to make money from any of this. If you are able to make money when prices bounce off of so-called support and resistance, then congratulations, you have probably made it as a trader. If you have found a way to make money from trends or swings, or have found a way to make money from broken trend or swing lines, then you deserve praise and are well on your way, or have already succeeded as a trader. The rest is just a mincing of words -- semantics. Support, resistance, trend, swing -- all are nothing more than ways to identify what prices appear to be doing. Any one of them can see the beginning of the end with the next price bar. If you tell me prices are at support, I will probably know what you mean. That is all the word "support" is good for! If you tell me prices are at "resistance," I will probably know what you mean.

Do I believe in support, resistance, trends, and swings? The answer is no! I do not believe in any of it. What I do believe, most of the time, are the numbers on the statement of my trading account. If they are getting bigger, then I am winning, unless, of course, the broker's back-office has made an accounting error, giving me your winning trade or, Heaven forbid, one of your losing trades.
We get a weekly post here from Joe Ross which I've been told he posts to several forums on the web.

He never returns to answer any of the questions that we've asked him in response to his posts.

My personal feeling is that this is not helping us here and is just adding "noise" to the forum and it's frustrating that he doesn't return to answer our questions. Many feel that this is a type of soft-spam.

I propose that I terminate these posts. If you agree with this opinion then vote up this (my reply) post and if you disagree then vote it down.
Well, to me it reads like he's waxing philosophical ... and in a circle at that. Perhaps some find the musings useful, but I guess it is somewhat deficient without a response to any questions or comments.

And of course it's a "soft" promotion for Joe.
"Get laid to trade!" (MonkeyMeat)

"Trade in the right direction, not in the wrong one!" (MonkeyMeat)
Annoying as it may be, I don't see any harm in letting his post(s) stay.

Here's what I believe: The trend is your friend until the end.

Do I believe in support, resistance, trends, and swings? The answer is no! I do not believe in any of it.

My week is not complete until I read Joe Friday's lesson.

MonkeyMeat your certifiable ...

Here's a video clip promo for Joe's upcoming trading seminar...

At least he responds to his e-mails.
Personally I don't really care, but I think that
"gibbledeegook" platitudes, are unhelpful to new traders and
so I voted for the deletion.

The regular traders of this board are far beyond his posting level.

To say "I believe in my trading account balance." is speaking down to all of us.

The key is not "believing in" one's account balance. It is what it is.

We are seeking trading methods to increase our account balance it in a reproducible way. If a novice is lucky and his account balance goes up but with no 'system' and a season professional with a solid system goes through an anticipated drawdown while following his system, are we to applaud the former?
How do I vote?!?!
(yea...I'm dense)
Originally posted by piperian

How do I vote?!?!
(yea...I'm dense)

You need a rep of 50 or more to be able to vote. When I replied you had 20. Make some interesting/wise posts and others will vote you up. 10 points per up vote. More here: Voting and Reputation
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