THE KISS PRINCIPLE

The text for this post is below the charts, hope it makes sense.




Todays post is all about the kiss principle, the best traders I know Keep it simple !
There are 3 charts to review chart 1 is an ordinary 30 min bar chart , the second is a market profile chart.the market profile chart is produced without any tricks it is a simple half hour chart where the time spacings have been removed and each 30 min bar turned into letters , and compressed.Each chart has a fibonacci re-tracement study on it.The point of the post is to show where to start such a study , and to do it in a way that has the trader instep with the market.the 3rd chart shows referece points that indicate how the longer term volume is set in the market, so we know which is the parth of least resistance when making trading decissions.
Markets move when a perception of value changes , this is most often caused by an outside infulence , it can be a central banks monetry policy anouncement, it can be a companies anual report to the market, it can be suply and demand of a comoddity or some world event.Wich ever it is we can be sure of one thing that the news will be in the price.And the truth is that there is no point in speculating the outcome of these events , if we get INSTEP , we can join in anytime.there is so much information that can effect price that it would be impossible to be on-top of it anytime so it's best just to trade the markets output.You may not get set at the very highest or lowest price ..but you will have the securtiy of knowing you are
INSTEP with the majority of participants at any given time.
Untill such an event occours markets distribute through a range of prices
( this process is random , as orders come into the market in random order) , during the process of distribution , all time frame participants can be drawn together, and we see this when moving averages converge.
The whole idear here is to identify when we have a new beginning , because it's our starting place to work from,if you are using a simple trading plan from fib retracements then its important to be working with the relevant data set.ON the profile chart we can see at the letter (a) we have a change in value , more often than not these moves will attract many participants and the period of trading will record higher than average volume.The fib study covers the initial move to (j), this distribution captures the force "at market" that pushed price higher.
notice that the bulk of the (a) period remain single prints .
( the force has with stood the challenge)

On the 3rd chart the reference points ( small red sqrs) show that over time the volume has also pushed this market higher.Further trading opportunities should be look at with a view to capture this backgroung strength.
All 3 charts are of different markets , but the principles remain the same .
chick on each to see the detail, and good luck, keep it simple.

By the way review all the charts and comments on the front page of this blog and tell me if I've been wrong ..