The Handbook of Technical Analysis + Test Bank_ The Practitioner\'s Comprehensive Guide to Technical Analysis ( PDFDrive )

Integrated Technical Analysis

fIgure 27.21 Dynamic Price Confluence the Daily Silver Chart.

Source: MetaTrader 4

fIgure 27.22 Dynamic and Static Price Confluence on the Daily Gold Chart.

Source: MetaTrader 4

Figure 27.23 depicts dynamic price filtering via a 2‐sigma Bollinger band set-

ting on the NYSE TICK Index chart. The market tends to bottom whenever the

TICK level becomes overextended with respect to the 2‐Sigma upper band level.

Hence, the convergence of TICK values testing its historical extremes and the

breaching the volatility range provides for a reasonable guide to predicting poten-

tial market bottoms.

Figure 27.24 depicts dynamic price filtering via a 5 percent band on the daily

Silver intercontract price ratio. The intercontract price ratio is the price of the one

futures contract month divided by the price of one futures contract from a dif-

ferent month. Every time the ratio exceeds the upper or lower bands, Silver tends

to reverse in the markets, as can been at Points 1 to 9. The practitioner should

therefore seek out any price barriers that may coincide with these volatility range

breakouts as a means of pinpointing appropriate entries.