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.

Now, if (sigh...when...) this keeps rising, my next levels are:

33.50

35.75-36.75 (the 'full' grouping is really 35.75-38.25)

42-42.75

Keep an eye on a possible bearish ABCD near the current high. I doubt this layout would play out, but it's worth keeping an eye on.

In the meantime, watch this 5-min TL right here. I just can't see this stopping after such a fantastic reaction off that ABCD, and then an ABCD pullback that it launched off off. But, we'll see.

Okay, there goes the TL, as expected. On to the next 'challenge'.

indication once again that early .886 on gap seems to be less reliable than late day.....

watching here....

was this it? 1.128 and not quite at the line? q's were weak at the open but got dragged along for the ride up.....if we get that spy push into 135 area do we get move on the q's into 59.42 - 59.68?

or do we just get a retest of the blue set and tankeroo?

.886 on that pop....do they mean it??

is this as close as it gets to 13501 for now??

I don't know but I don't see a gap left on the open bar today.

Originally posted by rat89

.886 on that pop....do they mean it??

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?