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Northington Trading
Trend Detection and Confirmation,
using Volatility-Based Support & Resistance
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Northington Trading
Agenda
Page 5
1. Review of Volatility-Based Support and Resistance (VBSR)
2. Trend Beginning and Ending with VBSR
3. VBSR Compression and Trend
4. Trend Confirmation with Trend Wave
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Northington Trading
Money is made at the Extremes
MetaSwing Philosophy
Page 6
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Northington Trading
Classic Technical Analysis
Page 7
Source: investopedia.com
Support: price level at which buyers become as powerful or aggressive as sellers and stop a price decline
Resistance: price level at which sellers become as powerful or aggressive as buyers and stop a price advance
Source: Technical Analysis: The Complete Resource for Financial Market Technicians, Kirkpatrick & Dahlquist, ©2007 Pearson Education
Source: investopedia.com
Source: investopedia.com Source: investopedia.com
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Northington Trading
Classic Technical Analysis
Page 8
Source: investopedia.com
Support: price level at which buyers become as powerful or aggressive as sellers and stop a price decline
Resistance: price level at which sellers become as powerful or aggressive as buyers and stop a price advance
Source: investopedia.com
Source: investopedia.com Source: investopedia.com
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Northington Trading
Volatility-Based Support & Resistance
Page 9
Is Not Your Grandfather’s Technical Analysis
•Adaptive
•Any Timeframe (fractal)
•Any Asset Class (robust)
•Non-Linear
•Immediate
•Predictive
•Statistically Proven
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Northington Trading
VBSR
Page 10
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Northington Trading
VBSR
Page 11
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Northington Trading
VBSR
Page 12
N band - design purpose: Historical volatility price point that price will not cross. If price crosses it a short term reversal should occur.
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Northington Trading
VBSR
Page 13
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Northington Trading
VBSR
Page 14
Performance Characteristics : when price comes to within 1 ATR of the N band, directional change occurs With Trend: 5 - 8 periods Counter Trend: 2 – 4 periods
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Northington Trading
VBSR
Page 15
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Northington Trading
VBSR
Page 16
Four pairs of lines: 1-2 3-4 5-6 7-8 Each pair is 1 ATR(40) distance apart
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Northington Trading
VBSR
Page 17
With Trend: 5 - 8 periods Counter Trend: 2 – 4 periods
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Northington Trading
Bullish Trend Begin
Page 18
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Northington Trading
Bullish Trend Pause
Page 19
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Northington Trading
Trend Contination
Page 20
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Northington Trading
Bearish Trend
Page 21
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Northington Trading
Messy Trend - aka: real world normal
Page 22
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Northington Trading
Trend Wave
Page 23
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Northington Trading
Trend Confirmation
Page 24
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Northington Trading
Trend Confirmation – Higer Time Frame
Page 25
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Northington Trading
Multi Timeframe
Page 26
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Northington Trading
Trend Confirmation – Breaking Resistance
Page 27
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Northington Trading
Trend Discussion
Page 28
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Northington Trading
MetaSwing Full Suite
Page 29
APPS CS:MS<GO>
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Northington Trading
More About MetaSwing
Page 30
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Northington Trading
More About MetaSwing
Page 31
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Northington Trading
Q&A
Page 32
Questions ?
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Northington Trading
Thank You for Attending
Kirk Northington, CMT Partner and Chief Technical Analyst [email protected] Twitter: @kirknorthington Carson Dahlberg, CMT Partner and Chief Technical Strategist [email protected] Twitter: @carsondahlberg MetaSwing: APPS CS:MS<GO> Phone: (704) 542-0156 www.metaswing.com
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Northington Trading
Trend Detection and Confirmation,
using Volatility-Based Support & Resistance