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Strategies & Market Trends : Classic TA Workplace

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To: sylvester80 who wrote (194028)	9/20/2011 10:09:51 PM
From: Henry J Costanzo	Read Replies (3) of 209892

AAPL... The parallel top line is not a trend line, but a *return line..It may be useful in judging the strength or weakness of a trend which meets, falls short of, or exceeds the return line. For example, the failure of the Sept 2010 rally to meet its return line at last Feb's high indicated a trend weaker than the Mar '09-Apr '10 rally which preceded it.. A return line is not* a resistance point..The only *trend line* in the 3-year daily chart is the line touching the Mar '09 and the June '11 lows. Today's high fell far short of coming anywhere near the upper return line parallel to the 3-year trend line...and, of course, there is as yet no indication that today's high has reached the top of the rally from the Jun low. Here is a chart of the 3-year period you mention..Note that it is on a geometric log scale rather than an arithmetic linear scale....A log chart is a vital requirement for any longer-term technical analysis of stock trends..

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