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Strategies & Market Trends : Systems, Strategies and Resources for Trading Futures -- Ignore unavailable to you. Want to Upgrade?

To: SE who wrote (8633)	11/15/1998 10:51:00 PM
From: Stoctrash	Read Replies (1) \| Respond to of 44573

Good stuff SE, very interested what GZ has to say in rE: to that post. I don't get this part: "A last useful technique is called a Babson reaction line. When you have a pitchfork that is containing price a number of times, that means the outer boundary has been tested a number of times. Obviously time always marches on [meaning, the time scale on a chart moves further right] and so unless a pitchfork is basically parallel to the horizontal axis, price will eventually be forced out of the boundaries by the march of time. Even in the case of such a breach, the pitchfork has at least one other use: Draw a parallel line to the right of the lower median line that is as wide as the original pitchfork. If this pitchfork was powerful, meaning it contained price over a period of time and was tested, then price often respects that parallel line, and that is called a Babson action/reaction line. It can be drawn parallel to either side of the pitchfork and it is usually extended four times, each time a width of the original pitchfork."