V.7:5 (143-146): Time, price and pattern by Robert Miner

V.7:5 (143-146): Time, price and pattern by Robert Miner
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Time, price and pattern by Robert Miner

This article is taken from the notes of my trading log for a closed and open trade in the platinum market. My trading plan is three-dimensional. I look for coincidences of time, price and pattern in market activity to indicate trades that promise maximum profit potential with minimum exposure and risk. Only when the market completes a reliable pattern, near a time period indicating a change in trend and at an important price level, do I enter or exit a trade. All three dimensions must coincide.

The time ratio analysis of the recent major cycles in the gold market indicated that the period near September 16-27, 1988 would likely result in an important change in trend.

Timing, as well as price activity, is often related to the important Fibonacci ratio of 61.8%. Most traders are well aware that price often retraces 61.8% of the prior swing. This important Fibonacci ratio is also very important in my timing analysis for the precious metals markets. A change in trend often results near a61.8% time ratio of a prior cycle extended from the completion of that cycle. Let me illustrate and explain why I was looking for an important change in trend near September 16-27.

The "death zone"

My timing analysis for platinum (Figure 1) is primarily keyed off the gold market cycles. The December 14, 1987 high to the June 2, 1988 high in gold equaled 171 calendar days. The Fibonacci ratio of 61.8% times 171 equals 106 and 106 calendar days from the June 2 high fell on September 16.

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