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Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?

To: el paradisio who wrote (49823)	5/8/2000 6:04:00 PM
From: HairBall	Read Replies (1) \| Respond to of 99985

el paradisio: Actually your first point for the upper descending trend line (the high on 4/10) is an invalid starting point. The trend moving up into that point originated from the pivot point (the low on 4/4). What invalidates 4/10 as a starting point is the point you use for your first point for the lower ascending trend line (the low on 4/17). It is below the starting point 4/4 from which the trend you used to start the upper descending trend line on 4/10 began. You can't do that...<g> The basic chart formations are really fairly simple, but folks miss some very important criteria. If you will look at the very first ruff example in the very first upper left square of the Chart Patterns Web Site you will see what I am talking about. chartpatterns.com If your chart pattern does not follow those simple basic drawings, most likely it is an invalid pattern. Notice how the trend rises or declines into the first point of the pattern. Also notice that most patterns are continuation patterns of the trend with the exception of certain wedge patterns. H&S patterns are another animal all together...<g> The mistakes I see most is folks drawing the trend lines to loose failing to use the highs and lows but just drawing the formations rough. Also I think folks often try to force a pattern where none exits. Of course, some folks do what you did... I don't use the exotic chart patterns I see some use. Frankly if they are not reliable, I don't use them. Of course no chart pattern is 100%, but some are a lot more reliable than others. I don't bet on the low percentage stuff...I don't even track them...<g> Out of here...good trading all! Regards, LG