Nick’s Lessons #8 – Stochastic Combo

– developed for you –

Only this indicator or combination with others?-

By itself is ok

This looks so nice…. What are the rules?

Put on the two MAs
67 exponential median Maroon

207 exponential median Green

consider the configuration and the price’s relationship for a preferred side to play

you can use Maroon for a target, and Mr. Green as well

look at how the last wave structure started from the cover longs area wave 1, 3 and 5 all ended in selling going crazy – to cover shorts

currently in a volatility whip where the hourly rsi maxes out on the upside then on the downside

this was the volatility whip – the purpose of this motion is to calibrate the market + work up some volatility for the next move (it brings the starting point closer to Maroon)

the volatility whip isn’t part of the wave structure

God Almighty only works in the direction of the current wave structure (a continuation)

you can see that the indicator did not call the cross down a short, because the longer term stochastic was too oversold

I had written the filter right the first time around (refer to what I said about using Maroon as a target)

wave 1 started when the whip finished (after 5 waves down) and it was a wave 1 because it managed to reach beyond Maroon

wave 1 always fails back to the other side of Maroon (minimum) or 2 dojis down (normally) or it can even make a lower low if necessary

wave 2 came down to check in with the unfinished extension fill at 1.1179 before traveling abroad

the rally tagged the Mean (green line) – aka Secondary Target

“the Green River can stop a move, any move”

believe or not, you are now in a wave 3 up – the count remains until the low of wave 2 gets violated at 1.11683

and now whilst nobody understands what is happening, you can

price drove into the forest and hit a tree

Interestingly enough, the peak was at 1.12543

Currently in a buy zone
The opposition calls this a break of the beat at 1.1179, and has a count 1 issued. The break should run to a 4-H exhaustion + beat and count would be at 7 or 8 by then. 4x 4 hours to go if the selling prevails. If this is a break, it is a rather weak one. You were in 2 pips gains at the close?!
The last cyan zone is different from the others. It is not a resistance tha became a support but more of a resistance not properly backtested with an empty area between the new support and the old resistance. We were having that back test yesterday. Look for candle sequences of 1-0-1 (white-black-white / black – white – black) to find a spot of a show down where a decisive action was made.

Ok, I surrender. The market is trading away from the peak charge – it was back tested at 1.1249. The smallest move came out of this kind of charge was 126 pips, but there are examples for up to 250 pips.

The next two support lines down are 1.1191 and 1.10949