Version 1.17 has just been released, and Wave59 can now support daily charts. Many people have been asking for this feature, so I'm very glad to have been able to take this step further. One benefit of this is that it allows us to use a lot of very interesting tools that didn't work on intraday charts. Here's a preview of what's coming in 1.18:
This is a chart of the QQQ, plotted with daily bars. That should be a new sight to the regulars. The other new thing on this chart is the planetary speed lines. These are similar to Gann angles, but the slope of the lines are determined by the rate of change of various planetary bodies. Not only does this give us natural ratios to work with, it provides interesting behavior since planets can go retrograde (backwards).
Take a look at the blue line moving up from the low in September. That represents Mercury. You can see that Mercury tends to go retrograde quite a bit - that's why the line is so wavy. The other lines moving up from that low reflect the motion of other planetary bodies. They have been labeled to make this easier to understand.
Now turn your attention to the high at the front of the chart. Notice that there's one red line moving down. This represents the average motion of four planetary bodies: Mercury, Venus, Sun, and Jupiter. These are important because they have the largest gravitational pull on the Earth. Gann knew this, and often used this average in his calculations.
These lines can be used the same way as ordinary fan lines. They act as resistance when above the market, and as support when below it. Good results can be attained by combining them with an accurate technical indicator like our UltraSmooth Momentum curve (shown at the bottom). Three interesting places have been marked on the chart above:
Point A: The market has touched the red speed line and bounced back down. There is a triple momentum divergence signal happening at this time (marked at bottom of chart). This would be a sell indicaton.
Point B: This situation is the same as point A. The market is unable to break above the red speed line, and momentum cannot make a higher high. The last momentum signal was a triple divergence signal, which is extremely bearish. This point is a major confirmation of that sell indication.
Point C: This signal is a reverse of what happened at point A. We've got a bullish triple divergence signal, and the market is bouncing off two planetary speed lines - Mercury and Mars. This was a buy signal.
In addition to the points mentioned above, there are quite a few
other times price reacted when it hit one of these lines. If the market continues
to decline, it should be interesting to see what happens when price encounters
the pink Jupiter line. Stay tuned!
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