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The above 50% rule is the (HIGH + LOW)/2 of the previous 2 days. Looking at the attached chart from todays trading of the 6B and 6E, I have taken the High of Monday and the Low of Tuesday divided by 2, and this the BLACK DASH line on the chart.
The market uses this as a magnet for S/R. It is quite uncanny how the market bounce of these lines. The attached chart shows it happening now in realtime.
I am looking for a simple indicator that will put say 3 -5 of these lines on the chart as we go forward each day.
So if we are Wednesday today, we will see the line of (Monday-Tues), (Friday-Monday), (Thurs-Fri) etc going back 3 -5 lines. This will give give 3 -5 history lines. One can then see how the market just bounces of these lines. Very effective and very simple
Cory,
Basically you want it on a day(24 hour) to Day basis. I do it manually, by looking at High and lows of the previous 2 days. I imagine that both options would work, i.e. puttin in a start time/end or session. As I trade only futures, they trade 24 hours, so I look at it from a DAY to DAY - 0 -23:59
You could then put say 5 lines as Day1, Day2, .....Day5
You always look back 2 days .i.e. Yesterday and the day before. Take the High of those 2 days and the Low of the those 2 days, divide by 2, this is your line.
NT does not help to have the H/L of the previous day, as you must take the H/L of 2 days from the current trading day.
This method is well known amongst professional traders who use it on a daily basis. I came across this some years ago in a book from Bryce Gilmore, and have used it ever since.
