Gold - Elliptical price zone analysis
I use ellipse analysis for long-term positions. This geometrical analysis is quite simple but usually gives good results. Basically, it is as follows:
- Mark Point.1 as the start point of ellipse.
- Mark the first following swing point as Point 2.
- Then mark the following second swing point (which is opposite of Point.2) as the Point.3.
- Since 3 points may define only one ellipse, you will find the elliptical price zone. Draw the long axis of the ellipse also.
- After point 3 follow the borders of the ellipse work as support/resistance points. The long axis of the ellipse will also work as median support or resistance.
If ellipse is not broken, we will reach the end point eventually.
When this analysis is applied to gold price action, we can see 1500 level as the final target of this elliptical zone.
Please also note that the axis of the ellipse is serving as a resistance, and we might say that now we are at resistance of this median line.
Somethimes basic maths may tell us everything....
- Mark Point.1 as the start point of ellipse.
- Mark the first following swing point as Point 2.
- Then mark the following second swing point (which is opposite of Point.2) as the Point.3.
- Since 3 points may define only one ellipse, you will find the elliptical price zone. Draw the long axis of the ellipse also.
- After point 3 follow the borders of the ellipse work as support/resistance points. The long axis of the ellipse will also work as median support or resistance.
If ellipse is not broken, we will reach the end point eventually.
When this analysis is applied to gold price action, we can see 1500 level as the final target of this elliptical zone.
Please also note that the axis of the ellipse is serving as a resistance, and we might say that now we are at resistance of this median line.
Somethimes basic maths may tell us everything....
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