Registered: Mar 2010
02-15-12 02:42 PM
Quote from 1a2b3cppp:
When price touched that trendline, you knew it was going to go back up as opposed to chopping around the trendline or going below the trendline?
We are in an uptrend, hitting the TL first at the 33-35 area, not yet made a new high, coming back to the TL. So yea, the TL acting as a support with other confluence (not marked on the chart) was a good probability.
Now, regarding exact touch vs bend/chop/go below, you see the 33-35 test and see how it chopped around a bit, ate as many retail stops as possible and finally took off? Now that is to be expected as well and we as traders have to be prepared to handle it. For me, this area was THE long, not the test later which held.
Lastly, TL by itself isn't as powerful as TL + confluence (S/R, channel, flag, etc)
And the poster above is right. Look for high probable setups and take your shot instead of waiting to know for sure what price is going to do.