lawnbowler

Many years back I viewed 100's of charts and concluded from what I saw that the whole number starting with one(1) and continuing with a zero or zeroes added acted as the most significant chart areas for support and for resistance. The second most significant areas were the levels starting with 5 and continuing with zeroes attached, as the case may be.

In with ECU case, I would consider the 50 cent area as significant support. When I speak of support, I am refering to the general supportiveness of the 50 cent area. Sometimes prices don't get to these important numbered areas and stop before while other times prices fall just a bit under.

This same philosophy can be applied to moving averages, as well. When I see a price breaking below or above, I respect the general area and give it some room and time to work until such time that I subjectively determine that it will not work. Then, the area's significance changes from support to resistance and vice versa.

It's all fun and games watching prices move around with your funds invested but the way I have learned to accept less risk is by having a plan. Your mind always needs to stay focused. I will admit that there have been times when I got so wrapped up in fundamentals that I threw my life preserver away and at times ended up paying the price. As long as a person stays focused, I think giving due respect to the whole numbers of 1 and 5 and a zero or zeroes attached to them, as the case may be, is just another form of insurance against making mistakes.