I started this journal to show a new approach to market timing, which is based on forecasting important points in future. Each of such points can be either a moment when next price move begins or a moment for a price level which could be challenged later after price consolidation. Using rational mathematical model instead of classical TA, I am able to calculate these points in advance with a horizon of next trading day. I am going to post forecasted points (Eastern Time) several hours before each trading session of ES&YM futures, in order to show a power of the market timing.
From practical point of view, major result is a forecasted point in future, which will set an important price level. Later market could move away from this level in any direction. If there will be enough liquidity, market will move immediately, in case of low level of liquidity, market will consolidate near this level of price and will move when liquidity will step in. So it is no need to be extra precious, however some of forecasted points are calculated with accuracy up to the one minute. My estimation for error of prediction is <3 minutes for fast moving market, and about 5 minutes for moderate fast market and a lot of time (even up to hours!) for slow market. Why? Because I cannot forecast market speed and level of liquidity, and my opinion that almost nobody can do it successfully. The same is true about the length of the price swings. If there are only few participants, market will consolidate near price level related to forecasted point and this process could take hours. The breakout from this consolidation will be still tradable.
Few words about foundation of my method. I surely will not disclosure any details, but will describe the model at the glance. My method of prediction exploits hidden order of price movements and can be described as cyclical analysis, however it is based on rational mathematical equations and does not use any traditional analysis like technical or fundamental. Forecasted points in future are points, where the process of formation of price levels (unstable spiral points) takes place (http://mathworld.wolfram.com/FixedPoint.html)
Spiral points can be predicted with enough accuracy, however market reaction on these points cannot be predicted well, so trader must understand direction of the market, in order to get profit from use of timing method.
From practical point of view, major result is a forecasted point in future, which will set an important price level. Later market could move away from this level in any direction. If there will be enough liquidity, market will move immediately, in case of low level of liquidity, market will consolidate near this level of price and will move when liquidity will step in. So it is no need to be extra precious, however some of forecasted points are calculated with accuracy up to the one minute. My estimation for error of prediction is <3 minutes for fast moving market, and about 5 minutes for moderate fast market and a lot of time (even up to hours!) for slow market. Why? Because I cannot forecast market speed and level of liquidity, and my opinion that almost nobody can do it successfully. The same is true about the length of the price swings. If there are only few participants, market will consolidate near price level related to forecasted point and this process could take hours. The breakout from this consolidation will be still tradable.
Few words about foundation of my method. I surely will not disclosure any details, but will describe the model at the glance. My method of prediction exploits hidden order of price movements and can be described as cyclical analysis, however it is based on rational mathematical equations and does not use any traditional analysis like technical or fundamental. Forecasted points in future are points, where the process of formation of price levels (unstable spiral points) takes place (http://mathworld.wolfram.com/FixedPoint.html)
Spiral points can be predicted with enough accuracy, however market reaction on these points cannot be predicted well, so trader must understand direction of the market, in order to get profit from use of timing method.
