THE QUARTERS THEORY

CHAPTER 1: BASICS-PART A
 THE QUARTERS
• A quarter is one of four equal parts of something.
• The Quarters Theory focuses on the 1000 PIP
ranges And divides theses ranges into four equal
parts, called Large Quarters.
• Each 1000 PIP range contains four Large Quarters
and each Large Quarter has exactly 250 Pips
• The numbers that mark the beginning and the end
of each Large Quarter are the Large Quarter Points
• The Large Quarter Point that coincide with Major
Whole Numbers are called Major Large Quarter
Point
• The exact half point of the 1000 pips range that
coincide with the Major Whole Number is called
the Major Half Point
• The 100 PIP Range is divided into four equal
quarters which is known as small quarters
• Each 100 PIP range is divided into 25 pips
• The Numbers that marks the beginning and end of
each Small Quarters are given as Small Quarter
Points
• The exact middle point of each 100 PIP range
coincide
• Twith a small Quarter point and is called the
Half Pint
 THE PREMISE OF THE QUARTERS THEORY
• The Quarters Theory is based on the premise that the daily fluctuations of the market are not random and
this currencies fluctuate in an orderly manner between the Larger Quarter Points
• The Quarters Theory challenges the notion that the financial markets are chaotic and prices are random
• The Large Quarter Points serve as a constant support/resistance levels. A bullish price breakout above a
Large Quarter Point is expected to target the Large Quarter Point above. Vice versa.
• When a targeted Large Quarter Point is reached, the Large Quarter is considered to be completed.
• If prices fail to complete a Large Quarter, this will result into price reversing to the preceding large Quarter
Point
 COMPLETION OF THE LARGE QUARTERS
• In most cases, it is rare to see price closing on the exact Large Quarter Point
• This is because price volatility has the tendency to conceal the Large Quarter Points, making them
difficult to recognise.
• although in most cases price moves can stop when a Large Quarter Point is reach exactly up to the PIP,
in most cases, price can either surpass the exact number of a Large Quarter Point by a few PIPs or stay a
few PIPs short of reaching it.
• In periods of high volumes and volatility, price may move beyond the exact number of a Large Quarter
Point, producing what we call an overshoot
• In periods of low volumes and volatility, price may undershoot a Large Quarter Point, coming a few PIPs
short of the exact number of a Large Quarter Point
• The Quarters Theory designates the range of one Small Quarter of 25 PIPs above a Large Quarter Point
as the overshoot area and the range of one Small Quarter of 25 PIPs below a Large Quarter Point as an
Undershoot Area.
OVERSHOOT AND UNDERSHOOT TRADES
• The Quarters Theory does not require prices to hit each Large Quarter Point exactly up to the PIP when considering
the completion of a Large Quarter
• As long as there is a number registered as high, low, open or close price number within one small Small Quarter of 25
PIPs above or below A Large Quarter Point, The Large Quarter is considered to be complete.
• If price fail to reach the undershoot area, the Large Quarter transition is considered to be incomplete
HOMEWORK

1. Identify the Major Whole Number, Major Large Quarters, Large Quarter Points, Small Quarter Points,
Major Half Points On Gbpusd, GbpJpy, EurUsd, EurJpy, AudUsd
2. Identify the overshoot and undershoot area and trades
3. Identify the completion of a Large Quarter
4. Identify the unsuccessful of a Large Quarter