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  1. #41
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    Quote Originally Posted by PCMNewsdesk View Post
    Drawing channels
    Trends usually lean to move inside specific channels. It means that as the change in the slope of the trend line could leads to change of the trend, voiding the market from the channel also can ends to change in the trend and its slope. To draw a channel, a line parallel with the trend line from the last existing price should be traced. To draw a trend line two points should be considered, as you remember, but to draw a channel there is no need of two touching points and just one touching point cold be assumed as a trend line. Do not forget that the channel line is a function of the trend and a channel would never be traced out before having a trend line drawn.



    Applications of the channels
    About the channel line, the same bouncing back behavior (but here towards inside of the channel) could be expected when the price reached in the trend line. Trading risk once the price touches the channel line is much higher than trading the same case but in trend line. The reason comes from entering the market against the main trend, while trading the trend line is along with the privilege price direction. There could be a third line between two existing trend lines, and it is called “middle line” which the same roles could be applied for this line too. Another point on using trend lines and channels is having them updated when the slope is getting lower and lower, then new lines should be considered avoiding likely trading losses.
    Ohh!! Great effort. I was unable to draw accurate channel of market. Because, did not know how to draw it for my lack of knowledge. But, you are too good dear. According to your description with picture now I am confident do make channel on right market trend. Definitely, I’ll add this western indicator with my price action trading strategy.

  2. Thanks PCMNewsdesk thanked for this post
  3. #42
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    Pivot and Camarilla lines and its calculations in Forex market analysis

    Pivot and Camarilla lines and its calculations in Forex market analysis

    Pivot Line Calculation

    Generally, the pivot is used to trade in a daily basis and Resistances and supports for the next day are attained by calculating on yesterday prices. But there are people who use these lines for larger periods such as weekly, monthly and even yearly. To calculate the pivot line 4 parameters including high, low, open and close prices from the last day is needed. Of course for 24 hour markets where it is not closed overnight, the open price is not considered and only the close price is used. The calculations are as follows:

    R1 = (2*PP) - Low
    R2 = PP + (High - Low)
    PP = Pivot Point = High + Low + Close/3
    S1 =
    (2*PP) - High
    S2 = PP - (High - Low)


    In calculating 24 markets’ pivot levels, the close price has a high importance, that’s because the market is not closed at a specific time, the traders could benefit from different hours. Most of the traders (people) get the pivot levels calculated through using the 00:00 hour of their broker which could be wrong. The best results come either from 00:00 GMT or 00:00 New York-EDT time zone which has a better performance compared to the other time zones. The high-low price is being calculated from the period between yesterday at 00:00 and tonight at 00:00.

  4. #43
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    Using Pivot Lines

    Using Pivot Lines

    Using pivot lines is just the same as using R & S levels, so that each one of the lines has potentially the capability to have the price reacted to it after drawing them on the chart. On the following chart after calculation of July 18th data the pivot and support lines will be placed on for July 19th. On the central European early trading session, the price reaches to the pivot level on GBP/USD but causing by buying pressure from the buyers it retraces back to the higher levels. Then at 10:30 CET the price crosses the pivot line with a gap downward upon a news from Britain is released throughout the market. By the next candle the price reaches the pivot for several moments and during the rest of the day it carries to S1 level. The price is not strong enough to break it below and then starts bouncing back to the pivot level. This time its role as a support levels is being converted to a resistance and the price at the end of the day is closed between pivot and S1 levels.



    The price is showing bullish bias during the rest of the day after having reached to the pivot line. However, R1 to R3 lines have been restraining the bullish behavior of the price but bulls turned out to be the higher hand at last.



  5. #44
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    The calculation steps of Camarilla lines

    The calculation steps of Camarilla lines

    Camarilla lines are also a typical R & S level. However, the formula and the way it is being used are different from the pivots but the structure is the same as R & S. in Camarilla lines, there are 8 lines being calculated everyday but usually 4 of them is being used. The formula is as follows:

    H4=((High-Low)*(1.1/2)) + Close

    H3=((High-Low)*(1.1/4)) + Close

    H2=((High-Low)*(1.1/6)) + Close

    H1=((High-Low)*(1.1/12))+ Close


    L1=Close-((High-Low)*(1.1/12))

    L2=Close-((High-Low)*(1.1/6))


    L3=Close-((High-Low)*(1.1/4))

    L4=Close-((High-Low)*(1.1/2))

  6. #45
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    Quote Originally Posted by PCMNewsdesk View Post
    Using Pivot Lines

    Using pivot lines is just the same as using R & S levels, so that each one of the lines has potentially the capability to have the price reacted to it after drawing them on the chart. On the following chart after calculation of July 18th data the pivot and support lines will be placed on for July 19th. On the central European early trading session, the price reaches to the pivot level on GBP/USD but causing by buying pressure from the buyers it retraces back to the higher levels. Then at 10:30 CET the price crosses the pivot line with a gap downward upon a news from Britain is released throughout the market. By the next candle the price reaches the pivot for several moments and during the rest of the day it carries to S1 level. The price is not strong enough to break it below and then starts bouncing back to the pivot level. This time its role as a support levels is being converted to a resistance and the price at the end of the day is closed between pivot and S1 levels.



    The price is showing bullish bias during the rest of the day after having reached to the pivot line. However, R1 to R3 lines have been restraining the bullish behavior of the price but bulls turned out to be the higher hand at last.


    Really Pivot is very much useful technical tool! But, I can’t calculate it manually! So, what’s you suggestion for me?

  7. #46
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    Quote Originally Posted by Ricard Dorman View Post
    Really Pivot is very much useful technical tool! But, I can’t calculate it manually! So, what’s you suggestion for me?
    This level is basically a type of support/resistant level. I think, it would be better, if you can make your trading skill on support and resistant level! S/R is very much important aspect to determine the market trend.

  8. #47
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    Quote Originally Posted by Marcus Reilly View Post
    This level is basically a type of support/resistant level. I think, it would be better, if you can make your trading skill on support and resistant level! S/R is very much important aspect to determine the market trend.
    Interesting, I really liked your suggestion! By the way, how many technical tools do you refer for identifying the market trend? Here, I am waiting for your answer.

  9. #48
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    Quote Originally Posted by Ricard Dorman View Post
    Interesting, I really liked your suggestion! By the way, how many technical tools do you refer for identifying the market trend? Here, I am waiting for your answer.
    Basic tools are, horizontal line, trend line & fibo. You can search on Google and watch bundle of videos on YouTube. Hope this helps you.

  10. ARIONFORXtarder
 

 
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