Andrews Pitchforks

[januson 10]

I've allways knew about AP, but first untill today I wasn't aware of the stong belivers in the fork.

I'm not stupid, and likewise all other I can see that AP is working or at least supposed to be working if they are applied after the tradingday ended.

Somehow it reminds me of technical analysis with simple trendlines, allways striving to get the past lows and highs into the picture.

 

Don't get me wrong, I really respect the work regarding AP etc., but to be really convinced and withhold a strong case here at TL, I think it would be very interesting to see the AP applied and followed! - Let's say for example a swingtrading 14 days or something like that.

 

Please... do not take my posting as a negative feature, I just want some enlightening

[Tasuki 10]

januson, if you need convincing, then investigate the work of Timothy Morge, and doubt no longer. Morge has TONS of free stuff on the web. Check it out.

[BlowFish 10]

Januson you might want to check the link provided in this thread http://www.traderslaboratory.com/forums/f34/trading-action-reaction-lines-a-presentation-3804.html

this might persuade you there is some merit in the methods. The presentation is long but worth every minute imho.

[waveslider 10]

Januson-

 

FWIW here is my pitchfork analysis for SPY, along with some channel and cycle stuff.

 

There is a lot of chart art here, but what to notice are the circles which highlight the validity of this particular pitchfork.

 

The median line has acted as support once so should it be met again it will likely act as resistance. The retracement line (from the Oct. high to Mar. low) also acts as support and resistance.

 

There is still time for this counter trend up move to complete. This particular chart shows a target about 3.5% higher than today's close.

 

Tagging the 50% line of the down move and the upper channel line with a failed gap up sure is an attractive short. Everyone sees this, so if it should go the other way (up) it would spark a nice fast rally...

[Tasuki 10]

Januson-

 

 

There is a lot of chart art here, ...

 

 

Wave, I can't see the pitchfork. Could you redraw with just the AP?

Thanks, Taz

[waveslider 10]

That picture didn't come out very well, sorry I am a little busy today maybe I can update it later - - the fork has a yellow median line and magenta tines, its there though hard to see.

[waveslider 10]

Opinions please?!

 

Here is a potential fork forming in the ES on the daily chart. The highlighted areas are spots I consider important failures or supports related to this particular fork. Its good to have multiple confirmations.

 

There are other reasons to be bearish here, the market breadth and volume are just horrible. The S&P has just failed at a major trendline (white on the chart, can't see the beginning on this chart). Also price filled in the gap from January 15, which is a huge break even point for a lot of people who got slaughtered then.

 

All these bearish things could be considered bullish!

 

Anyway - - there will likely be a good message in the market tomorrow, as I feel people are watching this fork, especially when price forms a doji...

[Tasuki 10]

Here's another view of Waveslider's daily ES chart. The only thing I've added is a notation that the test of the upper median line was done with what Tim Morge calls "good separation". In other words, price touched that line and then strongly recoiled from it. In pitchfork terms, this strengthens the belief that the median line was being "respected".

 

Unfortunately, we've now come up to that upper line a second time, and price has not rejected it as fast as it did the first time. This is not so good for the bearish case. If this AP is going to hold, we're going to need to see price pull back from this upper line fairly quickly. It will be very interesting to see how this plays out.

Edited May 14, 2008 by Tasuki
misspelled a word

[Tasuki 10]

Been a while since this thread got updated. Turns out that the key to the pitchforks is knowing what pivots to use, and that's as much an art as it is a science....an art that I confess I haven't mastered.

 

Attached are two weekly charts that might or might not work out (so take them with a grain of salt, so to speak).

 

My reason for posting these two charts is as follows:

Every monkey and his uncle has turned bullish in the past few weeks---in the last couple of trading sessions, some of the major indices have broken above their 50 SMA lines, which signals an "all clear" signal to the mutual fund money managers (who aren't very sophisticated) that it's time to put their money to work and buy the market.

 

Well, I just want to throw a monkey wrench into the works and suggest that these pitchforks hint at a possible downturn next week. Remember, next week starts earnings season, the time when "the rubber meets the road" for American companies. Needless to say, earnings season is destined to be a disappointment, but the sixtyfourdollar question is, how much of that disappointment has been priced into the performance of the major indices? These two weekly charts suggest that MAYBE there will be a downside surprise that has not been priced in yet.

 

Stay tuned!

[Horus 10]

Been a while since this thread got updated. Turns out that the key to the pitchforks is knowing what pivots to use, and that's as much an art as it is a science....an art that I confess I haven't mastered.

 

Attached are two weekly charts that might or might not work out (so take them with a grain of salt, so to speak).

 

My reason for posting these two charts is as follows:

Every monkey and his uncle has turned bullish in the past few weeks---in the last couple of trading sessions, some of the major indices have broken above their 50 SMA lines, which signals an "all clear" signal to the mutual fund money managers (who aren't very sophisticated) that it's time to put their money to work and buy the market.

 

Well, I just want to throw a monkey wrench into the works and suggest that these pitchforks hint at a possible downturn next week. Remember, next week starts earnings season, the time when "the rubber meets the road" for American companies. Needless to say, earnings season is destined to be a disappointment, but the sixtyfourdollar question is, how much of that disappointment has been priced into the performance of the major indices? These two weekly charts suggest that MAYBE there will be a downside surprise that has not been priced in yet.

 

Stay tuned!

 

Careful here:

 

You have to be careful when you use any tool and make sure that you do not make it fit your own expectations. Andrew clearly stated when you draw the pitcfork, pick Low to High points for b and c with no lower lows or high highers in between.

 

The low in April is lower than the low in around Jan which you have picked as point b. So the low in April should have been used here instead which wont give you the pretty picture you have drawn.

 

See my image, this is the correct way to draw the pictfork in this case.

[waveslider 10]

I have had this one on SPY for a while.

 

I find it significant that the center line acts as support on one side, then shoots through the gap.

 

On the other side the first peak fell short. I am expecting price to somewhat overshoot and hit the channel line (gold on this chart). Monday should be watched carefully, I expect the potential for a short to show up in the next 3 days.

 

Best clues will be divergence in market internals, and particularly the participation of the nasdaq which has shown much more strength than any other (probably due to financials).

 

I think the pitchfork on the Russell will be hit right on - in an area of critical resistance. Then we should have a nice ride back down to fill the gap created on Thursday...

[Tasuki 10]

Careful here:

 

You have to be careful when you use any tool and make sure that you do not make it fit your own expectations. Andrew clearly stated when you draw the pitcfork, pick Low to High points for b and c with no lower lows or high highers in between.

 

The low in April is lower than the low in around Jan which you have picked as point b. So the low in April should have been used here instead which wont give you the pretty picture you have drawn.

 

See my image, this is the correct way to draw the pictfork in this case.

 

Thanks, Horus, you certainly have an eagle's eye (or maybe I should say a falcon's eye) for detail. I've looked back over all the charts I've saved from Tim Morge, and indeed it looks like you are right. I've never taken a course or anything from Morge, just tried to follow his free lectures and webinars.

 

Where did you hear about this most important detail in pitchfork-making? Did you take Andrews' course?

[BlowFish 10]

Tasuki this guy has compiled a list of Andrews Resources.

 

http://www.median-line-study.com/median-line-for-beginners.html

 

http://www.median-line-study.com/advanced-users.html

 

Gordon's stuff (pitchfork primer) is good for 'vanilla' Andrews as taught by Andrews. I have Tim's book and good though it is he has covered most of the things over the years in his presentations. Still looking for someone with archives of his original mailing list. I could have swore I had it archived it somewhere b*&^%d if I can find it now.

[Horus 10]

Thanks, Horus, you certainly have an eagle's eye (or maybe I should say a falcon's eye) for detail. I've looked back over all the charts I've saved from Tim Morge, and indeed it looks like you are right. I've never taken a course or anything from Morge, just tried to follow his free lectures and webinars.

 

Where did you hear about this most important detail in pitchfork-making? Did you take Andrews' course?

 

I have read some of his original writing and also know Tim Morge (the pitchfork master ). If you have questions just contact me and Ill try and help you. I think the rules are pretty simple. I have tried to automate the rules so they are automatically drawn and tested some of the entries. The results have been average at best and with some filtering very good. So there is definitely some edge in using Pitchforks.

[BlowFish 10]

Talking of 'original writing' the original Andrews course is linked from the site above. (Though it does link back to Tims site).

 

Horus I don't suppose you have an archive of the emails from the old mailing list Tim ran? There was some truly excellent stuff on that. I am pretty sure I have it archived in an outlook .pst file somewhere but its probably on some old PC in storage.

[Horus 10]

Talking of 'original writing' the original Andrews course is linked from the site above. (Though it does link back to Tims site).

 

Horus I don't suppose you have an archive of the emails from the old mailing list Tim ran? There was some truly excellent stuff on that. I am pretty sure I have it archived in an outlook .pst file somewhere but its probably on some old PC in storage.

 

Hi Blow Fish

 

I may have it yes. I will dig up all that I have this weekend. Mine is on backups I am sure. I will put it on an FTP for you to download.

[Tasuki 10]

Hi Blow Fish

 

I may have it yes. I will dig up all that I have this weekend. Mine is on backups I am sure. I will put it on an FTP for you to download.

 

Horus, might you be able to post the FTP link here? I'm sure the members (OK, at least me and Blowfish) would appreciate it (very much). Thanks!

[BlowFish 10]

Hi Blow Fish

 

I may have it yes. I will dig up all that I have this weekend. Mine is on backups I am sure. I will put it on an FTP for you to download.

 

Thats kind of you. Don't 'bust a gut' I have managed probably 3 or 4 PC's without it .

[waveslider 10]

This is too perfect - -where is the fakeout, or was it the gap on friday?

Try the fork out that I posted on the SPY a week ago - its just too perfect.

If we shoot above the fork there could be a great momentum long trade, but for now, this thing is headed south.

[Tasuki 10]

waveslider and all,

See my attached chart. I took waveslider's chart (the first one, permalink #36, from April 5, 2009), and added two more lines.

I've never seen anyone use these extra parallel lines, either the pair that waveslider created, nor the two I made. Are they part of the pitchfork trader's toolbox and I've just missed them? More important, do they really work as support and resistance? Would be really cool if they did. Does kind of seem like my righthand red line is containing price, at least for the moment.

Any comments, anyone?

Taz

[BlowFish 10]

They look like a shiff set to me. A shiff set is the same as a regular trend channel (if your charting package plots them correctly).

[BlowFish 10]

They look like a shiff set to me (of ABC). A shiff set is the same as a regular trend channel (if your charting package plots them correctly).

 

Where a shiff crosses the median line is often where price turns. Jim Kane talks about this in "Median Line and Fibonacci Synergy".

[waveslider 10]

There is a method that I know of that uses this. They are used - but not how you are using them.

 

There is value to what you did, you showed the price destination according to the "normal" retracement in a down trend.

 

My x-y lines were just channel lines, that have a timing aspect. This is not my original idea either, I think JR stevenson wrote a book about it.

 

I'll send an example of what something using the lines as you described them taz, to show support/resistance.

 

In the mean time -this market has hit its target area. There is a chance a major rally could ignite from here - and the andrews line would have pointed to the halfway mark. So next stop is the upper fork line.

 

That remains to be proven. I'm still looking at inter market relationships to give the clues - especially the russell vs. s&p

[waveslider 10]

here're the rules:

 

1. draw a line from the bottom of the trend to the top of the trend. (uptrend example)

 

2. shift line horizontally so that the bottom of the line aligns to the date (time) of the price peak.

 

3. This line gives the support, and also tells you when time has run out for the trend to continue.

 

4. If price exceeds the previous peak you used for the top of the trend, the the trend is still active and a new line will be necessary when a pullback begins.

 

This idea is probably from Michael Jenkins - an incredible mind with charts - though I've never seen any of his ideas quantified. If they have been you can bet that the trades are not shared!

[velious 10]

bump. Hello everyone. Amature forker here looking to meet others!.