#Russell2000: Forecast Targets In Decreasing Probability Order
Friends,
Screening $IWM through my predictive/forecasting model, the following three targets were generated:
1 - TG-1 = 115.52 - 04 JUN 2014
2 - TG-2 = 117.83 - 04 JUN 2014
and
3 - TG-Hi = 119.72 - 04 JUN 2014.
PREDICTIVE ANALYSIS/FORECASTING ORIGIN:
These forecast targets are defined using the same predictive/forecasting model that produced all of my prior "Dead-On Hits" (simply Google "Dead-On Target Hits + 4xQuad" or "Dead-On Target Hits + 4xForecaster" for a variety, or simply go to my archives here: bit.ly/16JMnH8).
CHANNEL POINT DEFINITION:
Using TradingView's built-in channel tool, I projected downwards the top values line-up, allowing to define an acceptabe channel containing price around its vacillations. The median line was also able to approximate a line up of candle bodies/shadows as validation points for that median.
Now that the channel is drawn and price-based validation has been established, I looked for a a bullish trendline that would justify the recent price action to the upside, as it broke out of the channel. Striking is the fact that price did NOT validate the upper-side of the channel as it would classically do when price validates a trendline that is turned from resistance to support.
The fact that this did not occur may simply imply that the green dashed trendline which has been validated about 6 times now, is taking over the supportive role as price moves up and away.
PREDICTIVE ANALYSIS/FORECASTING:
As defined above, the model is capable to define step-wise levels of R/S, as well as reversals. Here, price has a higher probability to arrive at TG-1 than it does at TG-Hi, but if it arrived at that highest forecast, it would then have a greater probability of reversing to a significant depth.
As the data becomes too scarce to define a probability of depth reversal, I usually advise the trader to first use a Fib-paced approximation of the reversal, such as 38.2, 50. or 61.8 numbers. I also advise the pattern trader to look into the probability of a pattern completion - In this case, A Bearish Bat comes to sight if and when price completes is ascent to TG-Hi, although others might also perceive the possibility of a Bearish Shark, in which case, an ensuing 50% decline at/near TG-Hi would be expected, based on the 5-0 pattern, which is a known acolyte to the Shark pattern.
OVERALL:
Chart is bullish. Model calls for higher targets. Underlying technical analysis corroborate a probability of price breaking out to the upside - For these reasons, TradingView's directional indicator is switched to "Long".
Cheers,
David Alcindor
Predictive Analysis & Forecasting
--------------------------
Twitter: @4xForecaster
--------------------------
Screening $IWM through my predictive/forecasting model, the following three targets were generated:
1 - TG-1 = 115.52 - 04 JUN 2014
2 - TG-2 = 117.83 - 04 JUN 2014
and
3 - TG-Hi = 119.72 - 04 JUN 2014.
PREDICTIVE ANALYSIS/FORECASTING ORIGIN:
These forecast targets are defined using the same predictive/forecasting model that produced all of my prior "Dead-On Hits" (simply Google "Dead-On Target Hits + 4xQuad" or "Dead-On Target Hits + 4xForecaster" for a variety, or simply go to my archives here: bit.ly/16JMnH8).
CHANNEL POINT DEFINITION:
Using TradingView's built-in channel tool, I projected downwards the top values line-up, allowing to define an acceptabe channel containing price around its vacillations. The median line was also able to approximate a line up of candle bodies/shadows as validation points for that median.
Now that the channel is drawn and price-based validation has been established, I looked for a a bullish trendline that would justify the recent price action to the upside, as it broke out of the channel. Striking is the fact that price did NOT validate the upper-side of the channel as it would classically do when price validates a trendline that is turned from resistance to support.
The fact that this did not occur may simply imply that the green dashed trendline which has been validated about 6 times now, is taking over the supportive role as price moves up and away.
PREDICTIVE ANALYSIS/FORECASTING:
As defined above, the model is capable to define step-wise levels of R/S, as well as reversals. Here, price has a higher probability to arrive at TG-1 than it does at TG-Hi, but if it arrived at that highest forecast, it would then have a greater probability of reversing to a significant depth.
As the data becomes too scarce to define a probability of depth reversal, I usually advise the trader to first use a Fib-paced approximation of the reversal, such as 38.2, 50. or 61.8 numbers. I also advise the pattern trader to look into the probability of a pattern completion - In this case, A Bearish Bat comes to sight if and when price completes is ascent to TG-Hi, although others might also perceive the possibility of a Bearish Shark, in which case, an ensuing 50% decline at/near TG-Hi would be expected, based on the 5-0 pattern, which is a known acolyte to the Shark pattern.
OVERALL:
Chart is bullish. Model calls for higher targets. Underlying technical analysis corroborate a probability of price breaking out to the upside - For these reasons, TradingView's directional indicator is switched to "Long".
Cheers,
David Alcindor
Predictive Analysis & Forecasting
--------------------------
Twitter: @4xForecaster
--------------------------
