May be you can check if it closes right in the resistance level. Check if there is a perceivable change in short interest. If so avoid entering the trade. While looking at the chart it looks like it met the sept resistance level (range) Do you know why it moved sharply on that day.
Thank you Schizo! This tells me that I am going to have to incorporate the bigger picture and look at resistance lines as opposed to seeing it look good on the daily chart. When you had drawn the diagonal line down, is there a reason you didn't draw the line to the 2nd horizontal checkmark?
I think you are showing me that the diagonal trend line would have been established down crossing through at the time of purchase on October. I realized connecting the line after the gap leading into November would have been after the fact.
You want to choose a point that lines up the most with other points. I didn't draw a line extending to the 2nd horizontal because PRICE ALREADY CROSSED ABOVE THE TRENDLINE. In such a case, you want to draw the trendline from below. On the other hand, I would have normally drawn another trendline (line 2). As you can see, prices jumped up and down between lines 1 and 2 (refer to the arrows). Trendlines are powerful if you know how to use it properly. Unfortunately, most traders have no idea what they're doing.
Thank you very much for taking your time on this weekend to explain this to me. I would fit into that category of "not" knowing what I would be doing to get the full potential. You have helped me make the realization that I think I was so caught up in this indicator and that indicator, I had overlooked solid fundamentals/tools that have stood the test of time.