What Is the Bottom?
*Edit:* We did not inflect at the 61.8%P, so it looks like we are going to at least 286, probably going to continue rising until at least the 22nd of April. If, on the 22nd, it looks like there is any kind of downturn, that could possibly be the peak - taking into consideration time symmetry.
TL;DR -
Time and price symmetry are analysis of general market structure. Coupled with TA, it indicates that we will bottom out for this year on or around November 14th. The price of SPY when we bottom out for this year should be 220.09 or less.
SPY 220p 11/20
PART 1: [https://www.reddit.com/r/wallstreetbets/comments/fzhs4d/when\_will\_we\_bottom\_out/](https://www.reddit.com/r/wallstreetbets/comments/fzhs4d/when_will_we_bottom_out/)
PART 3: [https://www.reddit.com/r/wallstreetbets/comments/g2enz2/why\_the\_printer\_must\_continue/](https://www.reddit.com/r/wallstreetbets/comments/g2enz2/why_the_printer_must_continue/)
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Unfortunately, my last post seemed to be a bit too drawn out to capture the attention of the autists. As such, this one will be more succinct. The last post was on Time Symmetry. This post will describe price symmetry, which is a quantitative measurement of a deterministic value for price. Basically, we want to determine at what price the market will reach an inflection point based on reactive “price clusters”, derived from laws of supply and demand.
The basis of our discussion will rest on the following premise: if an instrument fails to achieve a new high in a range, it must achieve a new low in said range. If an instrument fails to achieve a new low in a range, it must achieve a new high in said range.
o *Price Theory* – market seeks to yield to one of two price objectives, therefore it is not random. Efficiency occurs at some price level, however price theory does not tell us the exact efficient price, simply the direction of the probable efficient price. When coupled with time structure, gives near certainty to call market inflection points.
· The price that an instrument or market reaches efficiency is unknown, but the price objective is certainty which indicates that a future price is the present price objective.
§ Price Patterns – price structure components is based on the market’s movements which conform to price objectives.
· Price Pattern Objectives – a possible area of mathematical support or resistance that may serve as a market inflection point. opposed to price theory objectives which are certain.
§ Inflection point – a level at which the market finds support or resistance and reverses from a value, commonly misconstrued with pivot points.
§ Projection Range – Predefined by mathematical calculations to determine possible terminal points for continued price action.
§ Mathematical Cluster – average of multiple mathematical support or resistance numbers occurring around the same approximate value.
§ Retracement levels – each level has own nuances and tendencies. Not every retracement bounce leads to successful trades which replace discretes. Must be used with tight stop-losses in order to validate large risk-to-reward ratios.
· Retracement memory – markets tendency to continue having retracements of future ranges equal to retracements of prior ranges which have been expanded
SPY has currently retraced 38.2% of the ABC swing which began this bear market. The 38.2%R is the second most magnetizing retracement, markets will often find price action occurring at this level regardless of whether or not it holds. Most instruments have a reaction at this level.
· Projections – quantifiable mathematical support or resistance calculation, different projection levels exist for different price patterns. Allow us to anticipate when to take profits or anticipate mathematical support/resistance.
o Projection Levels – PPN(A, B, C) = (PB – PA) \* PN + PC
o PN – projection Percentages (61.8%, 100%, 127.2%, 161.8%, 200%, and 261.8)
o A, B, C being the swing points
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When you plug the numbers into the formula, you will get a variety of projections for SPY. Anyways, SPY right now sits at 275.63. The closest projection is the 61.8%, also the most well known projection. This projection is only really useful to determine a shallow projection point indicating a later deeper retracement point.
Interestingly enough, this sits at the same value as another swing point on 11/1/2018.
However, we could have more confidence in a 100%P - the most important of all the projection percentages, instrument will typically encounter some type of support or resistance when reaching it. It could yield either a temporary pullback or a true market inflection point, so price action must be focused on at this level. It is a price pattern objective for all swings. It is a potential target once any swing activates, but only time will reveal if it is a true terminal point.
This level may be the conclusion of a corrective swing. If 50% holds an instrument, leading to swing activation, then there is a higher probability that 100% will be a true market inflection point. This projection allows us a clue as to whether we are witnessing a true trend change or if a correction inside the previous trend is simply being completed.
Therefore, SPY will either try to reach 100%P, which is 286.25, when break downwards, or, it is possible that the previous swing point coupled with the 61.8%P we have already reached, being in the 38.2%R, could cause us to turn downwards. If the latter is the case, we should see a large downturn tomorrow. Otherwise, I expect we will eventually reach 286.25 over the course of a month or so, then downturn.
So, where will SPY reach mid-November?
Price theory tells us that the goal is for the market to take out either its high or its low within a range. The negative 100%P for SPY is 220.09. Therefore, considering that this is less than half of the possible projections (261.8%P being the max, uncharted territory for the range), it is extremely likely that SPY will not only reach this value but also go significantly lower. Once it reaches 220.09, the trader should take partial profits and begin monitoring it intensely for further action.
Therefore, a wise trader could take puts from the current value on down to 220 with an 11/4 expiry date, selling along the way and capitalizing.
It should be noted that I am no expert by any means, I'm actually quite new to this, it is just an elementary analysis of patterns in price and time. I am not a financial advisor, and this is not advice for a person to enter trades upon.
Originally posted on Reddit. Browse posts from 2020.