Those are uptrend line backtests, very powerful resistances in downtrends, yes, even downtrends got uptrend lines Their subsequent tests are not as powerful. In uptrends you must listen to support after they are tested, instead of assuming they will be as powerful resistances as in downtrends. Xspurt, just adding a little to the discussion, hope you don't mind, otherwise, I can lay low.
Genuine trading discussions and reasoning are always welcome whether it agrees or disagrees with my outlook. You're spot on imho - welcome to the thread.
It looks like you are a hard working guy, so it will be my pleasure. You got a downtrend channel, marked by red lines, it's a downtrend, so it's optimal for you to find short signals as long as the downtrend remains healthy. You want to try to short high, not low, so you can obtain maximum profit, for this you must be patient. The white lines are the uptrend lines in a downtrend i was referring to. The green arrows point to the uptrend lines backtests, sometimes they touch, sometimes they bend, sometimes they don't, you can always go to a lower timeframe and search for the signal, an exhaustion bar, exhaustion volume, reversal formation, etc. Notice the "yellow mountain" formations I drew above the trendlines, they mark the amplitude Athlon referred to, the more clear the amplitude the more reliable the line is to price action, you want to listen to clear structures to avoid making up stuff. Do listen, when these areas do not act as resistance, this is price telling you something. Now onto study my friend
Thanks for the chart and explanation! So on the daily tf (eurusd) we are at an important junction according to your chart, and one should be looking for a short if the channel and trendline test holds.