I read with interest the last couple of weeks as the gold-heads are jumping over themselves to point out all the support and to talk about all the systemic risk we face. Clownish behaviour imho.
Support and resistance is not "evenly powerful". In a downtrend, support is meant to fall. It's not really support, except as some s-t salve to burn off an oversold condition, bring in some buyers, and let sellers get in on the retracement.
Same holds for resistance -- it is meant to fall in a rising trend and is not to be feared.
Of course, all of this begs the question "How do we know which way the trend is rolling?" This is where Elliott is a good tool. TA is like a lagging indicator as regards support and resistance. TA does have some predictive value, especially as regards coils, but Elliott is one of the few disciplines that, up-front, claims to be predictive. It is worthwhile somewhat over 50% of the time I would say, but not a lot over 50%.
The only setups worth trading, imo, are ones where we get TA, Elliott, and sentiment all agreeing. Trade only those and one increases the odds greatly of making winning trades. Still, it takes patience to wait for these setups, then conviction to commit in size to them, and then discipline to stay with the trade (not book the small win) and more discipline to get the hell out when your loss is small.
Trading is a humbling experience. I like that about it. |
