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Sunday, May 15, 2011

Fibs & Fibs...

After putting my post below to bed for a couple of days, I decided to have a closer look at potential upside and downside targets for TF (simply because that is what I daytrade).

That post mentioned high-basing on the Daily chart and a sideways-trending channel on the 4-hour chart with respect to YM, ES, NQ & TF. Should the TF break out of this sideways channel either to the downside or to the upside, Fibonacci confluence levels (in both directions) are shown on the following two 4-hourly charts.

The downside confluence level of 800ish lines up with the POC of the Volume Profile for the month of February and just above the 786.00 POC of the Volume Profile for the past 180 days.

The upside confluence level lies around 900ish. Last month's Volume Profile POC is sitting around 850ish and recent intraday action has failed to hold above this level so far. However, March's Volume Profile POC is sitting around 825 and has held as support so far. This would suggest that short-term resistance is at 850ish and support is at 825ish.

Purely from a statistical point of view, since price closed at 832.50 last Friday, a target of 900 would yield the most profit from that point vs one of 800. I'll see which target is preferred over the days to come. As a daytrader, I'll be watching to see how volumes and daily/hourly volume profiles build on lower timeframes and how price and momentum react around those levels for further clues.