1. UPS AND DOWNS OF TRENDLINES TRENDLINE CONSTRUCTION EXTENDED TRENDLINES SIGNIFICANCE OF TRENDLINES TREND CHANNELS CORRECTIVE FAN PRINCIPLES

2. TRENDLINE CONSTRUCTION

3. TRENDLINES ARE ONE OF THE MOST SIMPLE, YET EFFECTIVE, OF ANY OF THE TOOLS USED IN TECHNICAL ANALYSIS

4. SINCE MARKETS CAN MOVE SIDEWAYS, TRENDLINES CAN BE HORIZONTAL

5. IN ORDER TO DRAW A PROPER TRENDLINE, IT IS NECESSARY TO HAVE 2 REVERSAL POINTS TO CONNECT, OTHERWISE IT IS A LINE DRAWN IN SPACE WITHOUT ANY TECHNICAL SIGNIFICANCE A TRENDLINE REPRESENTS A DYNAMIC MOVING AREA OF SUPPORT AND RESISTANCE A GOOD TRENDLINE REFLECTS THE UNDERLYING TREND IT TRIES TO MONITOR

6. THIS IS NOT A TRUE TRENDLINE

7. THE MORE REVERSAL POINTS ARE ON YOUR LINE, THE STRONGER THE TRENDLINE

8. THE MORE REVERSAL POINTS ARE ON YOUR TRENDLINE, THE MORE IMPORTANT WILL BE ITS VIOLATION. 1 2 3

9. UNFORTUNATELY, THERE IS NO WAY TO KNOW WHICH OUTCOME WILL OCCUR AT THE TIME OF THE VIOLATION

10. VILOATION OF THE GREEN SUPPORT LINE ON THE RECTANGLE, AND VIOLATION OF THE RED TRENDLINE

12. EXTENDED TRENDLINES

13. AN OFTEN FORGOTTEN POINT CONCERNING TRENDLINES IS THE FACT THAT ONCE THEY HAVE BEEN PENETRATED, THEY REVERSE THEIR ROLE AS SUPPORT AND RESISTANCE LEVELS.

14. A

17. SIGNIFICANCE OF TRENDLINES

18. TRENDLINES OBTAIN THEIR SIGNIFICANSE FROM 3 FACTORS : 1.THEIR LENGTH 2.THE NUMBER OF TIMES THEY HAVE BEEN TOUCHED OR APPROACHED 3. THEIR ANGLE OF ASCEND OR DESCENT

19. VIOLATION OF ST-TRENDLINE HAS LITTLE IMPACT ON THE OVERALL TREND.

20. VIOLATION OF LT-TRENDLINE HAS SEVERE REVERSAL IMPACT ON THE OVERALL TREND.

21. THE MORE TIMES A TRENDLINE HAS BEEN TOUCHED OR CLOSELY APPROACHED, THE MORE RELIABLE IS THE SIGNAL

22. THE STEEPNESS OF THE TRENDLINE IS THE THIRD MAIN FACTOR OF SIGNIFICANCE

23. VERY OFTEN, PENETRATION OF STEEP TRENDLINES ARE FOLLOWED BY CONSOLIDATION PHASES

24. LESS STEEP TRENDLINE, THEREFORE MORE LIKELYHOOD OF TREND REVERSAL. ANY FAMILIAR FORMATION ?

25. TREND CHANNELS

26. OCCASIONALY, IT’S POSSIBLE TO CONSTRUCT ATRENDLINE THAT RUNS ROUGHLY PARALLEL TO THE BASIC TRENDLINE RESISTANCE SUPPORT

27. EXAMPLE OF AN UPTREND…

28. RESISTANCE NOW BECOMES A SUPPORT LINE

29. IT’S SOMETIMES POSSIBLE TO CONSTRUCT ANOTHER CHANNEL

31. THE MOVE OUTSIDE OF THE CHANNEL DOES NOT HAVE THE SUFFICIENT POWER TO GO HIGHER…NOT A GOOD SIGN !!! Volume ?

33. CORRECTIVE FAN PRINCIPLE

34. THE FIRST RALLY IN A BULL MARKET IS USUALY EXPLOSIVE, SO THE RATE OF ASCENT OF THE PRICE IS USUALY UNSUSTAINBLY STEEP

36. TRY TO DRAW A FIRST TREND LINE… (PRIMARY TREND)

37. …THEN DRAW A SECOND TRENDLINE… (INTERMEDIATE TREND)

38. …AND FINALLY A THIRD AND LAST TRENDLINE !! (LT-TREND) THOSE 3 LINES REPRESENT THE PHASES OF A BULL MARKET

39. THIS IS THE FAN PRINCIPAL !!

40. SAME PRINCIPAL THE OTHER WAY AROUND…