Support and resistance represent key junctures (decision points) where the forces of supply and demand meet. In the financial markets, prices are driven by excessive supply (down) and demand (up). Supply is synonymous with bearish, bears and selling. Demand is synonymous with bullish, bulls and buying. These terms are used interchangeably throughout this and other articles. As demand increases, prices advance and as supply increases, prices decline. When supply and demand are equal, prices move sideways as bulls and bears slug it out for control.**
This trading system was developed by a 30-year veteran floor trader for his personal use in the S&P trading pits. Several years ago, I was taught this trading system in its "raw" form. Over the years as the market has evolved, this trading system has evolved as well. We have adapted this trading system to be as effective in electronic trading as it was in the trading pits.
Why am I sharing these levels with you?
I am sharing these levels with you for the same reason they were shared with me; I want to help you succeed. In day trading, you need a statistical edge. We provide you with that edge by giving you an "insiders" point of view into how the market moves on a day to day basis.
The OTG SnR levels are based upon time and price cycles that occur in the market. Specifically, as price moves through time, decision points are created based upon measurements and time cycles. These levels are referred to as our Market Maker Levels.