The week starts out 'interesting'. Gold is only a few cents from the 'magical' $1600 level. I think the only magical level is $10,000, and the musings on when that gets taken out. If it does, and the moves were proportional, that prices gas at the pump around $30/gal and crude around $400. Imagine food prices then. The Swissie is exploding, and the EUR/CHF just set another new record low, as parity is now the talk. And this has our futures down a whopping 1.75 points. Wow, pretty scary, the ES down 1.75 points.

Okay, INTC starting to move up nicely now. What a buy that was when it was down, just like AAPL yesterday.

Hmmmm, ES opens down and drops quite nicely. INTC gave it all back, again. I have to say, I'm liking this. My 'most likely' area on the ES would be at that SL around 15-16, which is also a key .382 area. Let's see what the ES does with this bounce. It bounced two points hard off that plunge to 18 on the open.

So, that 15-16 area is an ABCD with an ABCD in the BC leg, at a key SL, a key set line, and a key .382, among other things. If it gets there, that area should really tell us something.

INTC really hit the toboggan slide there.

One commenter mentioned that they are 11 for 11 pointing this out so far.

http://www.zerohedge.com/article/es-risk-spread-compression-threshold-reached

buried in the noise was price movement that let me get out of my qqq short with nice profit in after hours....

Incredible trade and job, roofer. Even busted up you're all over it.

thanks jim...i really should not be trading....but in my busted state it is almost easier....trading reduced size,trading one setup, .886 on gap on 5 at geometry and absolutely ignoring all else...giving myself over completely to the tools....

Okay, 16 hit.

Originally posted by jimkane

So, that 15-16 area is an ABCD with an ABCD in the BC leg, at a key SL, a key set line, and a key .382, among other things. If it gets there, that area should really tell us something.

Anyone buy that ABCD in here?

I guess what I am saying is that not every time price hits a line, or lines confluence and price hits them, it's an area that produces a potential trading edge. With experience one can make an attempt at filtering out these areas that just don't have the right look to them. I'm not really talking about subtle, almost invisible variations here, I'm talking about 'obviously has potential', and 'obviously looks totally wrong'. This is frequently something that can be seen by eye real easily, but is very, very hard to program into a computer. I wish I had a chart example off hand for you, but I don't.

Originally posted by tx_ches

Jim, what do you mean when you say "our eyes would say the geometry is not good." How can geometry be bad?

I'm not convinced the algo's are using the same median lines as roofer all the time. On the QQQ's, I drew 2 other sets before I saw roofer's set and even after I drew another set. So all together there were 4 sets with lines going into his areas. The algos could easily have programmed in 2 of them without using the more minor swing low that roofer used.

How heavily do you think the algos rely on measured moves? It seems like I see a lot of median line sets that capture a measured move. I wonder if that is what the algos key on when it is looking like they key on a median line set?