AusDoc said:Bias is sound but be very careful to avoid thinking any moving average, or band of averages, acts as "strong resistance". This is an error of conventional technical analysis and is commonly sprouted by talking heads and experts of similar stature. Of course, it is then sprouted everywhere by inexperienced traders, and a good few more experienced ones too.
MAs are extremely useful tools when used intelligently but they can never overrule price action. It is wise to remember that no matter how many times you observe that a MA "supports" or "contains" price, that in fact, no such thing has happened other than in your interpretation. I can assure you that price will slice right through any MA whenever it has a mind to do so.
You may be well aware of this the golden gun and perhaps were just talking loosely but for the benefit of any who may read this I think it is worth trying to at least avoid possible confusion.
the golden gun said:Wow. Did you not just witness the selloff in cable from the 7090 level? In the context of the price action, the EMAs did act as resistance, sorry if you don't know how to utilize the tools properly. I can assure you that you can't teach me about price action either, so cut the patronizing tone please
Kuzia said:Hey! we all are on different and exceptional journey. Don't listen to anyone and trade yourself
sqa said:MAs are momentum indicators, but, in a classic ICT point, any vertical aspect to S&R is a function of Time and not Price. So it only functions as "resistance" due to a currently similar relationship between the moves and the Time the function is calculated over. Trendlines have this same problem.
However, enough people, even the Banks, use MAs that it's not a terrible idea to keep an occasional eye on them. There's a reason ICT even teaches the 9/18 EMA setup. It's a good place to start to learning Order Flow and Trend, but it's functional effect as S&R is far more limited.
sqa said:I meant to point out that the HTF level is actually closer to 1.7110 (by my Feed), while 1.7090 was a CDR-stack level over the previous 3 days leading to the drop. Plus, they were hunting the Monday Stops, while leaving the major players in the move.
I'm glad you for getting in the trade, but there's a good number of reasons to why the trade developed, though mass psychology does help explain certain actions.
AusDoc said:Bias is sound but be very careful to avoid thinking any moving average, or band of averages, acts as "strong resistance". This is an error of conventional technical analysis and is commonly sprouted by talking heads and experts of similar stature.
the golden gun said:Hey AuzDoc, check out the cool optical illusion on this EUR/GBP daily chart. It really looks like the 9/18 EMA band is acting as resistance. Glad you were here to teach me it's all in my head!