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, ES pulled back off the 1.272 ABCD area, to a KZ at key line, and then up and over, headed for the next level. Suh-weet.

First level below now hit.

Originally posted by jimkane

If this overcomes the bearish ABCD here my next levels are:

1300.25-.75

1302.00-3.75.

Getting ready for the next level.

Nice initial reaction off this spot, though.

Okay, KZ at key lines. Let's see if they gun it up again. So far the overlapping swings look more corrective on the way up here than impulsive.

Watch closely here, this is key. Another overlapping swing and push up, or is the three legs up so far it? Elliott abcde?

Because lightning was mentioned, I found a possible lightning setup.
But I had to work really hard to find the 78 line so take it with a grain of salt.

So fib confluence of 38/61,78. The 78 is the yellow fib set, the high of the last swing. The 61 is just above - cyan line which overlaps with a 56.4 magenta line. And the KZ as marked.

Lightning strikes if price makes it back to the area, does not exceed, then closes below it.

Myself, I'm 'hoping' it breaks down from here, to favor my intermediate-term setups.

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?