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Measuredmove

Trading Timeframes: Measured Moves and ContextIn the previous post, we introduced the concept of measured moves, a structured framework for estimating future price behavior. This method is based on the observation that each swing move tends to be similar in size to the previous one, assuming average price volatility remains consistent. While not exact, this approach offers a practical way to approximate the potential extension of a swing move. A common question that arises is: which timeframe should you use for measured moves, and how do you choose the correct swing move? These questions open up a completely different and important topic. Imagine analyzing a chart across three timeframes: daily, weekly, and monthly. You’ve projected a viable measured move on each chart. Now, ask yourself: which projection is the correct one? Where is the move most likely to play out? Daily Weekly Monthly The reality is that there is no singular “correct” answer. The appropriate measurement depends entirely on your purpose as a trader, the timeframe you operate in, and trading style. The Fractal Nature of Price Action Price action is fractal by nature. Regardless of whether you’re observing a 30-minute chart, a daily chart, or a weekly chart, the price displayed is the same in real time. However, the purpose of charts is to provide context. Each timeframe offers a unique perspective on how price has developed. For example, a 5-minute chart may reveal details about intraday movements while a daily chart condenses those details into broader a broader structure and context. These perspectives may align or contradict one another, they can confirm or challenge your biases. The key takeaway is that charts and timeframes are tools to contextualize price, not definitive answers. Defining Your Trading Timeframe To navigate the apparent contradictions between timeframes, start by defining your trading timeframe. This is where you analyze price structure, execute trades and define holding periods. This will answer the opening question: measured moves and other tools should in preference align with your trading timeframe. In case one wants to consider context, for various reasons, then multiple timeframes can be utilized. These act as a complement, not replacement. Here’s how different timeframes can be used for context. Higher timeframe: Moving one timeframe up will compress the price data, providing a broader context, but at the expense of detail. Lower Timeframe: Moving one timeframe down will reveal intricate details, but can introduce excessive noise. The balance between these components should match your trading style. Without a clear and defined approach, there is a risk of confusion and contradictory biases. The Concept of "Moving in Twos" Another, more anecdotal observation in price movement is the idea of “moving in twos.” This concept suggests that price often moves in sequences of two swings: an impulse move, followed with a pullback, which then repeats. There tends to be some price disruption after this has played out, but does not always imply that trend movement must stop after two moves. However, measured moves tend to align more reliably with these sequences. While not a scientifically validated principle, this concept has been discussed by traders such as Al Brooks, Mack and more. It provides a practical heuristic for applying measured moves more consistently. Practical Application To apply these ideas, consider the following: Define your trading timeframe. Use it as the primary basis for your measured move projections. If needed, incorporate one higher or lower timeframe to balance context and detail. However, these additional perspectives should not overrule your primary focus. Think in terms of “moving in twos.” Use this concept to locate sequences. This post was about the relationship between timeframes and the fractal nature of price action. The focus is on our role as traders and how we decide to operate, rather than absolute answers. This might be clear to most, but if not, take some time to think about and define your trading style.
NASDAQ:QQQEducation
by Trader-Shah
S&P500 Measured Move - ES Target 2024 Reached?That's a ...ummmhh..surprise at least. And it's crazy. I never thought this could happen. But we better shall believe, that ECH - Everything Can Happen! So, is the target reached for 2024? Nobody knows, right? But, I start to further close positions and take my profits in these Index and the correlating Markets. Don't let Greed eat your Brain §8-) As for my Christmas Lotto Ticket this year, I take a small Short Position now...LEAPs, Bear-Spread, dunno yet, but it's a Shortie that I can let sit for a couple Months. Talk soon...
CME_MINI:ES1!Short
by Tr8dingN3rd
Tron breakout has been climbing my dotted measured move lineEver since it broke up from the cup and handle pattern that I posted a chart about a week or 2 ago price action has been climbing the measured move line like a staircase this whole time so far. Always a remarkable thing to witness imo. You cant really get a good view of how it has been climbing this line on the previous chart idea I posted on it because its all the way zoomed out to show just how high the end target of this dotted line goes, and I think it. May have also been on the weekly timeframe where as this chart here is showing the daily and is more zoomed in to properly illustrate how price will often climb the measured move line after validating a breakout. So far this is a text book example of such behavior. Hopefully it continues to do so. I will post a link to the previous Tron idea with the more zoomed out look at the chart below as well. *not financial advice*
BINANCE:TRXUSD
by DrDovetail
2
Measured Moves: A Guide to Finding TargetsMeasured Moves: A Guide to Finding Targets Visualizing the boundaries of price movement helps anticipate potential swing points. The concept of measured moves offers a structured framework to estimate future price behavior, based on the observation that each swing move often mirrors the size of the previous one, assuming average price volatility remains consistent. While not exact, this approach provides a practical method to approximate the extension of a swing move. Background Determining profit targets across various methods and timeframes can be challenging. To address this, I reviewed the tactics of experienced traders and market research, noting key similarities and differences. Some traders relied more on discretion, while others used technical targets or predetermined risk-to-reward ratios. Levels of support and resistance (S/R) and the Fibonacci tool frequently appeared, though their application varied by trader. Based on current evidence, levels appear most relevant when tied to the highest and lowest swing points within the current price structure, for example in a range-bound market. In contrast, sporadic or subtle levels from historical movements seem no more significant than random points. The Fibonacci tool can provide value since measurements are based on actual price range; however, the related values have limited evidence to support them. To explore these ideas, I conducted measurements on over a thousand continuation setups to identify inherent or consistent patterns in swing moves. It’s important to emphasize that tools and indicators should never be used blindly. Trading requires self-leadership and critical thinking. The application of ideas without understanding their context or validity undermines the decision-making process and leads to inconsistent results. This concept formed the foundation for my analysis, ensuring that methods were tested rather than taken at face value. Definitions Trending price movement advances in steps, either upward or downward. This includes a stronger move followed by a weaker corrective move, also known as a retracement. When the corrective move is done and prices seem to resume the prevailing trend, we can use the prior move to estimate targets; this is known as a projection. For example, if a stock moves up by 10%, pauses, and subsequently makes another move, we can utilize that value to estimate the potential outcome. Well thats the idea.. Data Through manual measurements across various timeframes, price structures, and stock categories, I have gathered data on retracements and projections. However, this information should not be considered precise due to market randomness and inherent volatility. In fact, deviations—such as a notable failure to reach a target or overextensions—can indicate a potential structural change. As this study was conducted with a manual approach, there is a high risk of selection bias, which raises concerns about the methodology's reliability. However, it allows for a more discretionary perspective, enabling observations and discretion that might be overlooked in a purely automated analysis. To simplify the findings, the presented values below represent a combination of all the data. Retracement Tool In the context of price movements within a trend, specifically continuation setups, retracements typically fall between 20% and 50% of the prior move. While retracements beyond 50% are less common, this does not necessarily invalidate the setup. From my observations, two distinct patterns emerge. First, a shallow retracement where the stock consolidates within a narrow range, typically pulling back no more than 10% to 20% before continuing its trend. Second, a deeper retracement, often around 50%, followed by a nested move higher before a continuation. For those referencing commonly mentioned values (though not validated), levels such as 23.6%, 38.2%, 44.7%, and 50% align with this range. Additionally, 18% frequently appears as a notable breakout point. However, I strongly advise against relying on precise numbers with conviction due to the natural volatility and randomness inherent in the market. Instead, a more reliable approach is to maintain a broad perspective—for example, recognizing that retracements in the 20% to 50% range are common before a continuation. This approach allows flexibility and helps account for the variability in price action. Projection Tool When there is a swing move either upward or downward, we can utilize the preceding one of the same type for estimation. This approach can be used exclusively since it is applicable for retracements, projections, and range-bound markets as long as there has been a similar price event in recent time. In terms of projection, the most common range is between 60% and 120% of the prior move, with 70% to 100% being more prevalent. It is uncommon for a stock to exceed 130% of the preceding move. Frequently mentioned values in this context include 61.8% and 78.6% as one area, although these values are frequently surpassed. The next two commonly mentioned values are 88.6% and 100%, which are the most frequent and can be used effectively on their own. These values represent a complete measured move, as they closely mimic the magnitude of the prior move with some buffer. The last value, 127%, is also notable, but exceeding this level is less common. Application The simplest application of this information is to input the range of 80% to 100% into the projection tool. Then, measure a similar prior move to estimate the subsequent one. This is known as the measured move. There are no strict rules to follow—it’s more of an art. The key is to measure the most similar move in recent times. If the levels appear unclear or overly complicated, they likely are. The process should remain simple and combined with a discretionary perspective. Interestingly, using parallel channels follows the same principle, as they measure the range per swing and project average volatility. This can provide an alternative yet similar way to estimate price movement based on historical swings. The advantage of this method is its universal and adaptable nature for setting estimates. However, it requires a prior swing move and is most effective in continuation setups. Challenges arise when applying it to the start of a new move, exhaustion points, or structural changes, as these can distort short-term price action. For instance, referencing a prior uptrend to project a downtrend is unlikely to be effective due to the opposing asymmetry in swing moves. In some cases, measured moves from earlier periods can be referenced if the current range is similar. Additionally, higher timeframes take precedence over lower ones when determining projections. This is nothing more than a tool and should be used with a discretionary perspective, as with all indicators and drawing tools. The true edge lies elsewhere. Example Use 1. Structure: Identify an established trend or range and measure a clear swing move. 2. Measured Move: Apply the measurement to the subsequent move by duplicating the line to the next point or using a trend-based Fibonacci extension tool set to 100% of the prior swing. The first two points define the swing move. The third point is placed at the deepest part of the subsequent pullback or at the start of the new move. 3. Interpretation: While this is a simple tool, its effective use and contextual application require experience and practice. Remember, this process relies on approximation and discretionary judgment.
NASDAQ:QQQEducation
by Trader-Shah
12
Possible profit targets - a cautious estimateAs BTC has passed any former resistance zones, what can be expected? Currently, due to the global political situation, with focus on an escalation of the war in Europe and the Near East, the BTC run is likely to continue, just as gold will. As markets often move in 3 steps, the chart shows possible targets for 3 measured moves up. The recent consolidation zone between 12th and 17th November was dominated by a strong bullish engulfing candle on the 15th. The following candles showed weak bears and the uptrend quickly resumed. I'm expectin the next profit target at around 100K and the subsequent around 135K. Then we will probably see a stronger pullback.
BITSTAMP:BTCUSD
by ranxero46
DOES $MARA HAVE SOME ROOM TO GO UP?WITH CRYPTOCAP:BTC BREAKING OUT OF ITS CONSOLIDATION IS ONLY RIGHT EVERYTHING CRYPTO WAKES UP. WHICH BRINGS US TO NASDAQ:MARA TECHNICALS: NASDAQ:META has to regain the level of 18.52 for a pop to 19.38 if we can get a clean close above 19.38 we can see a clean run the 26.76 “REMEMBER, TREND AND VOLUME ARE THE GAS AND STEERING WHEEL THAT POWERS AND DIRECTS A MOVE IN YOUR TRADING VEHICLE (STRATEGY) , DON’T CAUSE AN AVOIDABLE ACCIDENT, TRADE SAFE”- TWINEY @T.W.I.N.E.Y
NASDAQ:MARALong
by twiney
$SQ Breakout Possible SQ looks to be about to start a new leg up if it can breakout of its wedge. Sq had a clean close above resistance with increased volume on 10/10/24. It experienced an inside day on 10/11/24 with still elevated relative volume from the prior days break out. Sq rejected at the top of the wedge but did not really show any slowdown of buying just an absorption of some selling as the prior days lows were not breached. The inside day on the11th appears to be a rest day looking for continuation and a breakout out the wedge targeting 72 and 74 dollars. The next area where the stock can potentially meet supply if it does continue on its newly started uptrend would be 79.82 (rounded to 80) then 87.52, the current yearly highs, and the 89.97 which is the prior years highs. Trade Safe Every1! @T.w.i.n.e.y
NYSE:SQLong
by twiney
Total Cryptocap’s log chart just hit the falling wedge targetIf we take the teal bull pennant and only measure the pennant part which is also a falling wedge, the target we get from the breakout has just been hit by our current price action. I felt that was worthy of posting a chart bout. Though bitcoin has already achieved a new all time high days ago, the entire market cap for all of crypto is still just below it’s previous all time high currently. I would expect that to change in the very near future, however there’s always a chance at a retracement once rice hits the full breakout target. Since we just hit the full breakout target of the teal falling wedge, then it could retrace, if it does it may take longer to reach a new all time high. ALso possible for it to pump just enough to reach a new all time high then start its retrcement, correction, or sideways consolidation. Either way we can see as I have stated in previous charts, that this falling wedge is also a very valid bullish pennant and the breakout target once you include the height of the pennants flagpole for your measured move line, Is a staggering 17.5 trillion or so…No guarantee we hit the full target this bull run, however the ay the bitcoin spot etf buying has kind of changed the paradigm of what’s possible there’s definitely a chance we could hit this full target for this current bull run. As I have stated in the past the dotted yellow measured move line to the left is a measured move target from a pennant we broke up from 2 bull cycles ago and it didnt hit its full target in that bull run. However since it is in a very close proximity to the price target of this teal pennant’s measured move breakout target as well, it creates a good bulllish confluence and we could see both targets hit this bull run. I would say worst case scenario we head to those targets by next bull run but very plausibly can reach them during this one. *not financial advice*
CRYPTOCAP:TOTAL
by DrDovetail
IWM: Something is Rotten in the State of MarketsPrimary Chart: IWM on a weekly timeframe with downtrend line and major support and resistance zones Note1: IWM is an iShares ETF that represents the Russell 2000 small-cap index in the United States. Though not as widely tracked as SPX, NDX, or DJIA, the Russell 2000 ( TVC:RUT ) is one of the major US indices. It is likely the fourth most watched US index. Note2: The phrase "something is rotten in the state of Denmark" is a well-known line from Shakespeare's play Hamlet used to describe a situation where something is wrong or even corrupt within a government, institution, or system. No corruption is intended to be implied discussed. The title's allusion to this phrase is meant to suggest only that something is off / wrong in the markets, i.e., that everything is not well despite the strength of the Nasdaq 100 lately and the support seen in SPX. The Russell 2000 (IWM) is often a leading indicator in US markets. It led to the downside in early November 2021 after a false breakout out of its 2021 topping-pattern's resistance around $234. SPX topped nearly two months later on January 4, 2022. While small-caps are not necessarily always the first to make a move, it is something frequently cited by commentators and analysts. The primary chart shows how IWM has struggled below the upper blue rectangular zone, a resistance / supply zone going back to highs in March and April 2022. This zone also rejected price at the end of the impressive August 2022 rally that had everyone debating whether the bull-market had returned in earnest. Lastly, on February 2, 2023, IWM was unable to even tag the lower edge of this zone, eking out a high at $199.26. The lower edge of this blue resistance zone as drawn here is at HKEX:200 - HKEX:201 approximately. The Primary Chart above also shows an important Fibonacci support level at $170. This the 50% retracement of the entire bull market from the 2020 Covid lows to the highs in November 2021. This has also marked important support since late October 2022 (a week or two after the October 2022 lows). Notice the weekly candle wicks protruding below this line but recovering back above it. The final point about the Primary Chart is the down TL from the all-time high in magenta. This was broken to the upside, which was one of the reasons many market participants and commentators got excited about the bear being complete. That trendline was retested in late March 2023. But despite this positive development, IWM has not acted well. In fact, it has broken decisively below a multi-month upward trendline from October 2022 lows as shown on the Primary Chart as well. This trendline was also important and signifies weakness on the decisive break below it. On the larger scale, price is trapped between the blue rectangular zones of support and resistance. Until these break, not much progress is likely in either direction. Sideways action is likely for the coming weeks. The one thing that would negate the sideways action view is a clean break back below the down trendline from the all-time high. So keep an eye out for that development. Next, Supplementary Chart A.1 and A.2 below shows a hypothetical illustration of how price could move sideways for the coming weeks / months before a flush below major support (if one is bearish about equities generally) or a rally above the key resistance zone (if one is bullish about equities generally). SquishTrade gives an edge to the bears in the intermediate to longer-term time frames—as long as price stays below both (1) the uptrend line from October 2022 lows, and (2) the key Fibonacci levels of the most recent decline (shown on the Primary Chart at $183.36 and $187.11). Supplementary Chart A.1 (measured corrective move upward where the legs of the corrective move might be equal or share a 1.272 Fibonacci relationship) Supplementary Chart A.2 (choppy sideways action that retests the upward TL from the October 2022 lows that had broken down in March 2023 before heading lower again) Supplementary Chart B is a zoomed-out version of the major resistance and support level shown on the Primary Chart. This is intended to show the ranging action for months that has taken place despite periods of seemingly impressive strength and sharp weakness. Supplementary Chart B The next chart, Supplementary Chart C, illustrates what a trendline might look like if someone were considering this chart afresh, i.e., for the first time without having tracked the prior trendlines during the 2021-2022 bear market. The TL has been re-drawn to account for the recent major highs at the end of the January to February 2023 rally. Supplementary Chart C IWM's anchored VWAPs are not encouraging. Here, the only VWAPs considered are the one anchored to the all-time high in November 2021 (blue-purple line) and the 2022 low (orange line). Price made a false breakout above the VWAP from the all-time high and failed back below. That in itself is a negative especially given that this occurred on a larger time frame going back to 2021. Price has also failed below the October 2022 VWAP as well. Supplementary Chart D Finally, and most importantly, consider the ratio spread of IWM/SPY in Supplementary Chart E below . This tracks the performance of the Russell 200 relative to the S&P 500. This is why something might be rotten in the state of Denmark (markets). A healthy market should not have an index looking this bad. Let me know what you think in the comments. Supplementary Chart E The ratio spread shows that IWM's underperformance just broke below a key support level for that ratio. But bigger support lies below. However, the overall picture looks bleak for IWM with a downtrend line that has lasted for a while, and lower highs for the ratio's value on higher time frames. ________________________________________ Author's Comment: Thank you for reviewing this post and considering its charts and analysis. The author welcomes comments, discussion and debate (respectfully presented) in the comment section. Shared charts are especially helpful to support any opposing or alternative view. This article is intended to present an unbiased, technical view of the security or tradable risk asset discussed. Please note further that this technical-analysis viewpoint is short-term in nature. This is not a trade recommendation but a technical-analysis overview and commentary with levels to watch for the near term. This technical-analysis viewpoint could change at a moment's notice should price move beyond a level of invalidation. Further, proper risk-management techniques are vital to trading success. And countertrend or mean-reversion trading, e.g., trading a rally in a bear market, is lower probability and is tricky and challenging even for the most experienced traders. DISCLAIMER: This post contains commentary published solely for educational and informational purposes. This post's content (and any content available through links in this post) and its views do not constitute financial advice or an investment or trading recommendation, and they do not account for readers' personal financial circumstances, or their investing or trading objectives, time frame, and risk tolerance. Readers should perform their own due diligence, and consult a qualified financial adviser or other investment / financial professional before entering any trade, investment or other transaction.
AMEX:IWM
by SquishTrade
18