Advanced Course Remastered: Lesson Two - Fractal Information

Overview

• Jumping into examples from beginner's course, adding complexity.
• Focus on the S&P 500 chart.
• Dissecting different time frames: 12 months, monthly, weekly, and daily.
• Identifying valleys (support levels) and peaks (resistance levels).

Time Frame Analysis

12-Month Time Frame

• Mark the deepest valley possible.
• Typically not recommended for routine analysis.

Monthly Time Frame

• Identify next untested valleys:
  • Example: August 2015 (tested), September 2016 (untested), January 2020 (untested).

Weekly Time Frame

• Look for additional valleys:
  • Example: September 2020 (close to previously marked valley, may be treated as the same level).

Daily Time Frame

• Drill down for more detailed analysis:
  • October 26 (within same valleys previously identified).
  • June 9, 2020 (already tested).

Peaks and Valleys

Valleys

• Represent levels of support.
• Larger time frames’ valleys can contain smaller time frames’ valleys (compound analysis).
• Use valleys to identify potential buying opportunities.

Peaks

• Represent future resistance.
• Mark the swing low of a move; if price moves lower, it creates a peak (future resistance).

Practical Application

• Example: Trend lost → bounce off bottom (support) → creation of peak → move down to next untested valley → break resistance → move up.
• Not a hard and fast rule but an advanced analytical tool.

Summary and Next Steps

• Practice identifying peaks and valleys on charts.
• Upcoming lesson: Uptrends and Downtrends, their impact on chart movements.