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Is Support and Resistance Meaningless?
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Is Support and Resistance Meaningless?

  #41 (permalink)
Trading Apprentice
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TickedOff View Post
Depends on what timeframe the level is (i.e. its strength) and how volatile the market is. Shorter time frame levels tend to not get respected when volatility picks up and get chopped around; they dont really give you direction and sometimes during these conditions you need to adjust your levels and see them form as the day unfolds.

I guess it depends on how we are using or defining S&R. I trade Crude Oil on the 1-minute time frame and S&R works for me just as well as it does on a daily or weekly. But, that's just me.

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  #42 (permalink)
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My take on this is that sometimes levels hold and sometimes they do.

If enough people trade the level, then people jump on board and it perpetuates the move.

S/R levels themselves attract a lot of retail traders and as such are areas that will be gamed. So I think they are poor areas to take a trade but they are area where a reaction can start. So for me - if a reaction starts at a key level, I will be happy to change my bias to that direction.

I don't really care if a level holds or breaks - just that people appear to be jumping on board.

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  #43 (permalink)
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DionysusToast View Post
My take on this is that sometimes levels hold and sometimes they do.

I don't really care if a level holds or breaks - just that people appear to be jumping on board.

I think that pretty much sums it up. If you have a hard entry, you're gonna get burned by those pokes above and below S&R. It's best to wait and see if you have others piling on before jumping in and riding the wave.

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  #44 (permalink)
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Here's an example of a level that didn't hold, since price didn't touch the support and bounced around above the level I took my chances that it was going to get hit. If your reward outweighs your risk you're doing a good job.

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A long could have been made after the level was hit too *, that's another play ( I did not take )

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  #45 (permalink)
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Itchymoku View Post
Here's an example of a level that didn't hold, since price didn't touch the support and bounced around above the level I took my chances that it was going to get hit. If your reward outweighs your risk you're doing a good job.

...

A long could have been made after the level was hit too *, that's another play ( I did not take )

Did you go short right into a support level?

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  #46 (permalink)
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trendisyourfriend View Post
Did you go short right into a support level?

yes, but I got out right as it touched.

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  #47 (permalink)
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Rarely do you see price come down that far and then hover over the support without puncturing it.

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  #48 (permalink)
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What about this level


Itchymoku View Post
Here's an example of a level that didn't hold, since price didn't touch the support and bounced around above the level I took my chances that it was going to get hit. If your reward outweighs your risk you're doing a good job.

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A long could have been made after the level was hit too *, that's another play ( I did not take )

@Itchymoku

Would you have considered this level I have highlighted on your chart? This is some thing I look for.

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  #49 (permalink)
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Here is the SPX using a good old Point-O-Chart for identifying S&R:

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  #50 (permalink)
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mrmuggins View Post
@Itchymoku

Would you have considered this level I have highlighted on your chart? This is some thing I look for.

yeah i saw that, I mean it's all over, and when it's not there it's usually a result of people, or programs, playing the odds that too many people have caught onto it and thus are now trying to hit the levels they think the new stop would be of the traders who are entering at the s/r. It's a never-ending game of duck duck goose. This is why many traders think it's meaningless is because it's not straight forward whatsoever, there's added layers of complexity to it.

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