Trading systems and indicators are for blind, assuming fools. That's like watching a dog everyday pass your house, and betting and assuming it will do it again , that it will follow each and every step and exact path. You have to truly open your mind and horizons and dynamic viewpoints when you approach and view trading, tackling it successfully and fruitfully profitably.
Statistically, trend lines represent randomness. Or, put it in another way a broken clock can be right twice a day/year but bears no statistical meaning in time tracking. What you are showing is more of a pattern than using trend lines, if by itself is only apparent a few times a year.
I think the only significant point on the trend line is the first touch of the accumulation area which leads to the breakout and the new trend up and vice versa for distribution and trend down.
Not believing in trend lines =/= not believing in TA. BTW, a lot TA stuff (such as various indicators) is statistically insignificant. But patterns are the opposite.
Patterns have boundaries - which are trend lines. You can't have geometric chart patterns void of trend lines.
Everything has boundaries. The key question is Do the pattern boundaries/trend lines bear any statistical significance? Let’s say we can recognize an up trend forming through patterns in a higher lows and higher highs fashion. However, how can one predict the extent of the next higher low and high? Trend lines attempt to form such a prediction by drawing (relative) straight lines, which are a very suspect of forced curve fitting. In fact, the “lines” can be any other shapes than lines, literally. In other words, patterns can have any shape, to the infinite. Yet we can still predict an up trend pattern, just not the extent of the movement in any statistically significant way.
When the stock operator is able to do his job, the chart looks beautiful. He is an artist. Only when it blew up, the public get to see the inner working and the ugly side. This is exactly what the scientists at CERN are doing, smash the proton and see what is inside. Investors are hitch hikers, hoping to get near to the destination safe. http://www.businesstimes.com.sg/sto...-remains-elusive-for-penny-stock-saga-amended
I've done technical analysis on charts going back hundreds of years...drawn trend lines and channels, etc. and prices behaved the same back then as it does now. Truth be told, I don't know why trend line and channels work but I just know that it does. That's all I need to know. I will add this, though. Trend lines and channels are cool for measuring a trend but I've found that the horizontal formations are the ones that determines the greatest trade entry areas.
Trendlines do not cause "market behavior". Trendlines are a timing tool and they can "help" identify different types of price actions. Hundreds of different ways of using/drawing them. Draw enough trendlines to cover your chart...price action will eventually bounce off one of them. You can then remove the other trendlines that price action didn't bounce off and then declare they work via the remaining few trendlines you kepted on the chart (sometimes called cherry picking). Backtest the way you draw your trendlines or how you use trendlines...you'll better understand the above. wrbtrader