Locating The Shortest Support and Resistance

How I Find The Next Day Shortest Support and Resistance. Using the current day opening price makes more sense than using the previous day, as I’I looked at pivots drawn with various combinations of current high, lows, and closes.

Daily Average Formula =(H + L + C)/3 (divided-by3) 1 day pivot.


Daily Average Formula =(H + L + C)/3 (divided-by3)

Using the opening price it makes more of a difference on the a 1 day pivot.

Using the current day opening price makes more sense than using the previous day, as I’I looked at pivots drawn with various combinations of current high, lows, and closes.

I learned this daily average formula from a Market Maker formal money manager of S&P Fund.

He used the formula to calculate the next day support and resistance probability.

I then experimented it throughout the day using this formula and found it to be an excellent price follower.

All you need is a calculator, add the H + L+ Last prices of the day throughout the day if you like to follow the price reversals the trading day.

The close price becomes the bench price for the very next trading day.

It goes like this:

1. If yesterday's close remains at the close price maybe lacking demand trading sideways.


2. If today's price trading above yesterday's close or low could be a signal of possible buying interest.


3. If the price is trading above yesterday's high could be signaling demand and could expect the price to move higher and maybe a strong close.


4. If the price is trading below yesterday's low or close below the daily average, generally a gap down usually follow at the next day open.

Using The Daily Average During The Trading Secession

I use the same formula calculations with the current H+L+L (high,low,last)

When I'm using these calculations after I had selected my stock to buy I'd done my due diligence's, but the stock is making me have doubts.

I'll re-calculate if the number ends up being lower than the Last Price or the daily average price, I'll keep checking if the price keep dropping.

Wait to buy until the last 10 minutes I might get a cheaper price same with selling I follow the price direction.

However, I'll already had figured out how much I was willing to pay for the stock.

I selected the 3 price ranges, to take the excitement out of the play. I work with numbers from my trade plan when I was setting up my trade not my emotions.

I don't need to be freaking out with only...YIKES 5 or 10 minutes to spare before the market close trade my plan. Scottrade is good for executing this time frame.

Using A streamng Chart To Follow The Shortest Resistances And Supports of the day.

Another good tip is to draw a line on a streaming or Live chart for the Open price; High; and Low in the first hour or 1/2 hr of trading.

Those trend-lines locates the prices, which becomes resistance and support lines.

You'll see that the prices will repeat to those levels sometimes throughout the day.

SIRIUS SATELLITE

7/22/08 H 2.44 + L 2.06 + C 2.38 = 6.88/3 =2.29

7/23/08 H 2.70 + L 2.23 + C 2.68 = 7.61/3 =2.53

Daily Average for Friday

7/24/08 H 2.75 + L 2.31 + C 2.42 =7.48/3 =2.49

The main objective....is the price going in the direction according to the plan?