1. Recommend Using Longer-Term Data
As markets undergo volatility, it’s crucial to adopt a strategy that leverages longer-term data to identify long-term trends and avoid daily chart corrections. Rather than looking at daily price changes, I recommend starting each weekend with the weekly chart. This approach helps in detecting structural changes before diving into daily analysis, which can be too granular and less actionable.
2. Difference Between Short- and Long-Term Data
Each month, I examine the monthly chart and technical studies, such as support/resistance levels, to compare with the previous month. While this method can identify shifts in technical indicators, it doesn’t capture subtle patterns that emerge over weeks or months. Technical studies are particularly useful for identifying key levels for bullish or bearish scenarios.
3. Importance of Pivot Analysis
Pivot analysis is a lesser-known method compared to other trend-topper indicators. Instead of looking for peaks, pivots identify support and resistance levels based on the market’s equilibrium price. For most, pivot analysis is noniptables, but it has its merits, especially when combined with other methods.
4. Lesser-Used Methods
Three pivot analysis methods are highlighted: yearly, quarterly, and monthly. While these are more advanced, they are often overlooked. Pivot analysis with a strong pivot point can be misleading if alone, but combining it with support/resistance or resistance/support levels can provide valuable insights.
5. Case Studies Highlighting ETFs
Starting with the Invesco QQQ Trust (QQQ), I demonstrated how pivot analysis helped QQQ test yearly pushers. Moves above and below pivotal points were crucial, ensuring that long-term trends were respected. This approach showed how pivot analysis can bridge daily fluctuations against broader market views.
6. =’AS Signals and Their Relevance’_
Weekly resistance or pull-back signals, as opposed to rates, were analyzed. These signals, often accompanied by Asymmetrical Daily Trade Signals (DTS), provide clear directions for positioning.Jerry A, my colleague, emphasized that DTS, combined with pivot analysis, is a powerful tool for hedging or maximizing gains, especially during market downturns.
Conclusion
By adopting this methodical approach, incorporating pivot analysis, and using weekly data instead of daily, I found consistency in detecting support and resistance. This strategy, tailored around pivot analysis, can be a cornerstone of effective trading, helping to manage risk, capture profits, and be prepared for market volatility.
