MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2007 Lecture 3 – Trend Analysis This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 1 Uptrend November 22, February 3, 2005 Kirkpatrick & Dahlquist Chart 12.1 StockCharts.com Walt Disney - Daily Smaller Trend Larger Trend

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2007 Lecture 3 – Trend Analysis This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 2 Peaks and Troughs Used to Determine Trend December 6, February 9, 2005 Kirkpatrick & Dahlquist Chart 12.2 Trough Peak StockCharts.com Walt Disney - Daily

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2007 Lecture 3 – Trend Analysis This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 3 Trend Line Drawn Through Troughs December 31, February 18, 2005 Kirkpatrick & Dahlquist Chart 12.3 Walt Disney - Daily Trend Line (Bar Chart) StockCharts.com

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2007 Lecture 3 – Trend Analysis This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 4 Trend Line in Candlestick Chart December 31, February 18, 2005 Kirkpatrick & Dahlquist Chart 12.4 Walt Disney - Daily Trend Line (Candlestick Chart) StockCharts.com

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2007 Lecture 3 – Trend Analysis This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 5 Support and Resistance Zones February 7, April 22, 2005 StockCharts.com Kirkpatrick & Dahlquist Chart 12.5 Walt Disney - Daily D B C A E F

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2007 Lecture 3 – Trend Analysis This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 6 B A C Reversal Points February 7, April 22, 2005 Kirkpatrick & Dahlquist Chart 12.6 Walt Disney - Daily Determining Two-Bar Reversal Points StockCharts.com

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2007 Lecture 3 – Trend Analysis This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 7 Kirkpatrick & Dahlquist Chart 12.9 Two-Bar Reversal August 31, April 15, 1996 StockCharts.com One-Day Reversal Two-Day Reversal Walt Disney - Daily

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2007 Lecture 3 – Trend Analysis This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 8 High-Volume Reversal July 2, August 27, 2003 Kirkpatrick & Dahlquist Chart 12.8 StockCharts.com One-Day Reversal High Volume Resistance Stops Rally Walt Disney - Daily

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2007 Lecture 3 – Trend Analysis This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 9 Resistance Line Support Line (ZONE) Support Line Support and resistance at Toughs and Peaks Resistance Line Support and Resistance Lines February 7, April 22, 2005 Kirkpatrick & Dahlquist Chart StockCharts.com Walt Disney - Daily

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2007 Lecture 3 – Trend Analysis This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 10 Regression Line and One Standard Deviation February 26, September 11, 2003 Kirkpatrick & Dahlquist Chart StockCharts.com Walt Disney - Daily Regression Line from Low to High +/- One Standard Deviation Channel

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2007 Lecture 3 – Trend Analysis This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 11 Trend Line February 26, September 11, 2003 Kirkpatrick & Dahlquist Chart StockCharts.com Walt Disney - Daily Uptrend Line

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2007 Lecture 3 – Trend Analysis This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 12 Accelerating Trend Line August 31, April 15, 1996 Kirkpatrick & Dahlquist Chart Walt Disney - Daily Accelerating Uptrend Line StockCharts.com

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2007 Lecture 3 – Trend Analysis This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 13 Decelerating Trend or Fan Line February 1, July 25, 2000 Kirkpatrick & Dahlquist Chart StockCharts.com Walt Disney - Daily Decelerating Trend Line (or Fan Line)

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2007 Lecture 3 – Trend Analysis This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 14 Trend Line with Channel Line February 26, September 11, 2003 Kirkpatrick & Dahlquist Chart StockCharts.com Walt Disney - Daily A B Uptrend Line with Channel Line

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2007 Lecture 3 – Trend Analysis This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 15 Anticipating a Breakout Kirkpatrick & Dahlquist Chart 13.6 Price Resistance C B A

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2007 Lecture 3 – Trend Analysis This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 16 Intra-Bar Breakout February 26, September 11, 2003 Kirkpatrick & Dahlquist Chart 13.1 StockCharts.com Walt Disney - Daily Support Zone Intra-Bar Breakout

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2007 Lecture 3 – Trend Analysis This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 17 Close Breakout February 26, September 11, 2003 Kirkpatrick & Dahlquist Chart 13.2 StockCharts.com Walt Disney - Daily Support Zone Close Breakout

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2007 Lecture 3 – Trend Analysis This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 18 Gap A Gap B Gaps With and Without Retracement August 21, January 19, 2001 Kirkpatrick & Dahlquist Chart StockCharts.com Walt Disney - Daily Gap A - No retracement = Continue Trend Gap B - No retracement = Reverse Trend

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2007 Lecture 3 – Trend Analysis This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 19 Breakout Filter February 26, September 11, 2003 Kirkpatrick & Dahlquist Chart 13.2 StockCharts.com Walt Disney - Daily Support Zone Breakout3% Filter Above Resistance Breakout Above 3% Filter

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2007 Lecture 3 – Trend Analysis This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 20 Breakouts to Support Levels September 17, October 3, 2002 Kirkpatrick & Dahlquist Chart StockCharts.com Walt Disney - Daily Note: Each breakdown reaches previous support and rallies back to the breakdown level. Previous Support = Price Objective on Breakout Previous and Current Objective

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2007 Lecture 3 – Trend Analysis This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 21 Stop for Specialists Breakout September 3, February 3, 2004 Kirkpatrick & Dahlquist Chart StockCharts.com Walt Disney - Daily Breakout Place Stop Here

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2007 Lecture 3 – Trend Analysis This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 22 Simple Moving Average February 26, September 15, 2003 Walt Disney - Daily 60-Day MA Regression Line One Std. Dev. about Regression Line Kirkpatrick & Dahlquist Chart 14.1 StockCharts.com

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2007 Lecture 3 – Trend Analysis This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved Moving Averages - Support & Resistance Zone February 26, September 19, 2003 Kirkpatrick & Dahlquist Chart 14.2 StockCharts.com Walt Disney - Daily 60-Day MA 20-Day MA Cross-Over Crossover is a Signal in a Trending Market Where moving averages cross is often a Support and Resistance area

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2007 Lecture 3 – Trend Analysis This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 24 Moving Average Crossovers Causing Whipsaws November 30, July 1, 2001 Kirkpatrick & Dahlquist Chart 14.3 StockCharts.com Walt Disney - Daily 20-Day MA 60-Day MA Buy Sell Whipsaw in Flat Trends with SMAs

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2007 Lecture 3 – Trend Analysis This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 25 Trend Line versus Simple Moving Average February 26, September 15, 2003 Kirkpatrick & Dahlquist Chart 14.5 StockCharts.com Walt Disney - Daily 60-Day SMA Trend Line

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2007 Lecture 3 – Trend Analysis This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 26 Close/20-Day SMA Sell for Return to Mean Buy for Return to Mean Sell Ratio of Current Price to Moving Average December July 2005 Kirkpatrick & Dahlquist Chart 14.6 Source: TradeStation Walt Disney - Daily

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2007 Lecture 3 – Trend Analysis This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 27 Directional Movement Indicators December July 2005 Kirkpatrick & Dahlquist Chart 14.8 StockCharts.com Walt Disney - Daily 14-Day SMA 14-Day ADX DMI + DMI - P P P P P

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2007 Lecture 3 – Trend Analysis This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 28 Envelope About a Moving Average December 4, June 16, 2001 Kirkpatrick & Dahlquist Chart 14.9 StockCharts.com Walt Disney - Daily 60-Day SMA with 7% Envelope During a flat trend, enter when price breaks in envelope, exit when price breaks out of envelope        Buy CoverSell Short Cover

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2007 Lecture 3 – Trend Analysis This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 29 Bollinger Bands December 4, June 26, 2001 Kirkpatrick & Dahlquist Chart StockCharts.com Walt Disney - Daily 20-Day SMA with 2 Std. Dev. Bands (Bollinger Bands)

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2007 Lecture 3 – Trend Analysis This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 30 Uptrend February 26, September 11, 2003 Kirkpatrick & Dahlquist Chart Trough Peak StockCharts.com Walt Disney - Daily Peak Trough