Keying In On A Vision

Your centralized vision has a dual mandate: to see and to spot.

It is hard to see through a cloud of blur, to peer through a flatu-lenses.

So let’s hone in.

What has changed this week?

The company name… and along with it my trading philosophy.

May 14-20

Let’s cut to the chase.

Bottoms and less tops we’ve been talking of.

The key fractal is a fractal that is outside the pendulum’s body, it jams the hourly RSI2 to the floor for hours and is followed by an RSI2 relief.

if (i>1 && iFractals(symbol,0,MODE_UPPER,i) && High[i]>iMA(symbol,0,44,0,MODE_EMA, PRICE_MEDIAN,i)+350*Point && RSI2[i+2]>96 && RSI2[i+1]>96 && (RSI2[i-1]<90  || RSI2[i-2]<90 )) EU[i]=High[i];
        if (i>1 && iFractals(symbol,0,MODE_LOWER,i) && Low[i]<iMA(symbol,0,44,0,MODE_EMA, PRICE_MEDIAN,i)-350*Point && RSI2[i+2]<4 && RSI2[i+1]<4 && (RSI2[i-1]>10 || RSI2[i-2]>10 )) ED[i]=Low[i];

The one thing nobody seems to be making a study out of is the sequence of events.

You are not going to know if you have seen the key fractal until the ink dries on the RSI 2 hours later, hence price needs to be taken back to it for a dump.

What is the question mark called? Low key.

The fractal has 4 values, such as OHLC. In case of a measuring leg you can expect all of those values to be beaten if not briefly settled nearby with a handful of pips to show for at most.

In case of a divergent leg, the re-visit may choke at the second closest level of the OHLC.

Some Florida Keys for you.

What now?

We are headed to the 50EMA. Momentum is up, the temporary weakness was relieved by the daily candle being connected back to the 20EMA, closed right at the break-out level of the prior leg.

1.0682-1.0748

Didn’t I say that a Key is where the turn is?

Well, the pendulum band starts at around 1.0515. It is possible that this correction is not over yet, we merely saw the max volatility move and now the continuation divergence would print above the S30.

Without further consolidation, these are the statistical probability moves from here:

The previous leg down fell shy of the orange line by 40 pips when it was making a run for it. A similar magnitude move would equate to 1.0485.

Ideally there would be a third row print, i.e. close(s) below the shadow line (at 1.0521 currently), but we also need to consider that things are becoming more and more bullish on the way up and less and less may just be enough from here on.

Based on the stochastic bars, a head may be missing still.

All in all, keep shorts on a short leash (trail stop) & hold on tight…