The small Darvas Box is a tool I rarely see on retailer lists. On the other hand, it is not uncommon for Darvas to list multiple professional traders when entering an institutional trading room. This e-mini indicator is basically an indicator of short-term support and resilience. I like that it allows you to immediately find your first contact because it allows local traders to come across sites where traders in the past chose to reverse the market in the opposite direction. It also provides useful information about potential breakdowns and breakages.
Why don’t trade educators teach Darvas box theory?
Let me explain from the beginning that modern box theory has been around for a long time and there seems to be no way to make money in this type of trading by developing and marketing a new indicator similar to the old indicator. In today’s e-mini scalping environment it is software sales that have driven profits as new traders look for new “magic” indicators that will drive them to glorify profits. With few exceptions, what is needed in most traders ’plan is to learn to trade with real-time indicators without having to constantly rework old indicators and pack them into something new, different, and different. So this retail trading tool has hardly been considered instead of new less effective systems.
So what the hell is this Darvas box doing that can help your trade?
I am not dyed or broken in wool in the store; I found the most successful support / resistance (SAR) lines created by the boxes to determine potential initial areas for trading. By adding instructions on the order flow program and volume, you will be able to find out whether the price to continue on that short-term resistance or whether this is the reverse point. Also, I have to keep in mind that I tend to put more action on Darvas box breakdowns than fractures; although I don’t completely rule out fractures, I’ve found that breakdowns are a more reliable trade than fractures.
The box signals are given in real time, there is no delay as they are printed directly on the main board and are very easy to detect. No adjustment is required to make the box system more efficient or less efficient. In fact, all the boxes shown are dynamic SAR entry and exit points. Yes, I said exit points. I often use the bottom lines of the box to calculate my stops. These are some of the uses of the Darvas box system and through deeper reading, you can find many uses for this forgotten ugly duckling. But don’t be fooled, this little kid can put money in your pocket when it’s hanging for use. As always, best of luck in your trade.