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Strategies & Market Trends : STOCKS WITH ATTITUDE TEAM - FA/TA AND EVERYTHING ELSE -- Ignore unavailable to you. Want to Upgrade?

To: Redhead who wrote (2106)	2/1/1998 11:33:00 AM
From: Doug R	Read Replies (2) \| Respond to of 2377

Redhead, The IL is a trendline I use to delineate the limits of irrational exuberance in a stock. I consider a trendline to be a description of current supply/demand dynamics. The IL is a line created on a short-term basis that has on at least one occasion proven to be resistance. It is normally a very steep line and the longer it extends the higher it gets. Few stocks actually go to the IL but when one does, I know a rapid and deep pullback is coming. The chart of a stock has to satisfy certain requirements before the IL comes into existence so not every chart has one. Once the IL has been broken to the upside, the price often uses it as support one or more times but eventually, the stock breaks below it and a short position becomes very profitable. Doug R