Paul Levine

Market Interpretation/Data Analysis System

Dr. Paul Levine, a lifelong student of markets, was a very smart person. He held an undergraduate degree from MIT and a PHd (in theoretical physics) from CalTech. Towards the end of his life he focused his attention on trading the market, and on developing MIDAS, a method he invented that provides a unique window into the undercurrents directing price movement.

Levine strongly believed that the dynamic interplay of support and resistance (S/R) and accumulation and distribution are the ultimate determinants of price behavior. After examining and rejecting all of the standard technical analysis techniques for determining support and resistance, he came up with a new approach.

Prices fall when there is more supply than demand. In a falling market, there exists a price at which new or returning buyers will enter the market as a purchaser. As they do in increasing numbers, the demand for the stock begins to rise. When supply and demand are in balance, the price stops falling. We say price has met support.

Likewise in a rising market there exist a price at which current owner will sell or take profits. As they do, the supply of the stock begins to rise. When supply and demand are in balance, the price stops rising. We say the price has met resistance.

A paradigm shift takes place where ever the market changes direction. The longer its falling or the longer it has been rising, the greater the importance of the paradigm shift.

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