Time and Price.

I have a lot of comments to which I really need to reply. Give me some time. This post is about two critical elements in technical analysis, Time and price.

The immediate relevance ia a request by men to find out if it is possible to forecast the time in which a head and shoulder bullish breakout will hit its target.

Now, Time is a much more difficult element to forecast. Any number of unknown events can influence Time. Suppose a big hedge fund trader did not come to office today. Therefore a planned trade was not taken, which if taken would have pushed up prices of Orchid (example). He came in the next day, when the trade was taken. Understand how time has been influenced by a factor completely unrelated to charts. You can easily imagine many more scenarios like this.

Price forecasting and target setting is much easier. In fact, setting a price target is part of many technical analysis studies. Often, these targets wil be hit, but when? As I have just explained, the time factor is difficult to predict.

Now, there are some sections of technical analyysis, which do forecast time. Gann, was a pioneer in such forecasting. Since no one after him has been equally successful, I assume that Gann had some extraordinary abilities. The methods which deal in Time forecasting are: cycles, Different types of fibonacci time projections (including Elliot Waves). If you do work on Time, then you should be looking at Time zones rather than a date.

Price and Time together
Think carefully, if a trader can forecast Price and Time, both, then what is left? You are really like God, telling us the exact future. Therefore, this ability is unlikely. Traders who do try to forecast time and price understand that they will get only one of the components right. Either Time or Price. An example for the Nifty is given below.

NIFTY

For the Nifty, two last two time projections for swing lows worked out well, but the price targets were not touched, which suggested strength. The last three targets for swing highs were touched suggesting strength. The current up move was projected as below:
Price target: 4730 – 4870 zone
Time Zone: Sept 4 to Sept 8.
What happens if prices move up today also. Then the Time target has shifted. What happens if prices move beyond 4870. Then, the price targets have also shifted. Thus, you can only surmise that the Nifty may be reaching some kind of short term consolidation.

The downside time zone as of now is: Sept 14 to Sept 18.
The price zone is: 4525 – 4385.

Remember, these are only probabilities. Also, as I explained, usually, Time or Price (amy one) may touch our estimates.

Please do not trade on these numbers, as much more analysis (on your part) will be required to use them. But you can surely try to correlate these ideas with your own analysis.

Cheers.