how do we ‘find’ a level?

the FX market is the biggest market in the world w/ trillions of dollars traded every single day … yet, that being said, based on nothing more than math we can derive a nice pattern/ level to go long or short. I think that is kind of cool …

where to start? I like to think of PERS-D.

P= project. I use 3 targets of .618, 1.0 and 1.618

in this case we PROJECT DOWN and you can see that the orange line is 1.618*blue.

Now we get to the “E” of the PERS-D. People get confused or forget about the E. It stands for EXTENSION. key high or low swings are key and what happens when you retrace them 100 percent? do they lose their importance? no … so we can extend off those points as shown below. (I start w/ 1.27 and 1.618) as you can see, the “shelf of support” is the 1.27 extension and importantly notice where the 1.618 extension lies … right at the 1.618 price projection.

PER – time for “Mr. R” … the plain old retracement. you can spend an entire day on this subject but for now, we will keep it easy. what I REALLY REALLY like to see is the old .382 right on top of the .618. (note: .382+.618 = 1.0)

so we have PER and now the “S” who the? what the? S? S stands for structure and, specifically, polarity w/ regards to support and resistance …. do we have that?

so we get to D which is Divergence and we can check that out if it gets there … so PERS-D.

but think of the math and the 7 reasons 1.15 area will be HUGE for the fate of the EURO.

Bart

Author: BART

BART is a CMT and an expert a "advanced" pattern recognition used w/in the intermarket analysis discipline. He's also an accomplished Business Development Executive providing solutions to a myriad of business markets.

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