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Strategies & Market Trends : Ask Vendit Off-Topic Questions -- Ignore unavailable to you. Want to Upgrade?

To: Vendit™ who wrote (5405)	2/26/2005 2:29:44 PM
From: Gersh Avery	Read Replies (2) \| Respond to of 8752

trend and/or support/resistance lines simply represent sentiment. A stock has been on a run up then hits a top. The top is marked, most of the time, by a spike in volume with little or no movement in price. : The big boys are dumping their stock off to the little guys. Then the stock heads down until it hits a bottom. Again the point is marked by a spike in volume with little movement in price. .. Little guys giving up in disgust while the big boys take the nasty paper from them. The stock then heads north again. As it gets near the last top little folks that still hold the stock wait to just break even. They vow that if the stock could just hit that break even spot they will sell. These kind of emotions help to form the patterns we look for in the charts. This is very much over simplified. However, charts are simply pictorial representations of mass psychology. To determine the validity of a channel, there usually has to be at least two touch points on a line. With forks, the starting points form the slopes. The fork already has three touch points.