Comments on: Time To Draw Some New Trendlines! http://dummyspots.com/2007/01/time-to-draw-some-new-trendlines/ Stocks, Options, Currencies and One Big Dummy Sun, 12 Oct 2008 10:51:28 +0000 http://wordpress.org/?v=2.2.1 By: More New Trendlines, and a Chart Quiz • dummyspots.com http://dummyspots.com/2007/01/time-to-draw-some-new-trendlines/#comment-960 More New Trendlines, and a Chart Quiz • dummyspots.com Tue, 23 Jan 2007 02:37:37 +0000 http://dummyspots.com/2007/01/time-to-draw-some-new-trendlines/#comment-960 [...] Back in my January 11 post, I noted that we needed to redraw our longer-term trendline on the Qs due to their having hit a “higher high.” Well the S&P did the same thing last week, so we’re a bit overdue in redrawing that one. Here’s the previous trendline with the December break: [...] […] Back in my January 11 post, I noted that we needed to redraw our longer-term trendline on the Qs due to their having hit a “higher high.” Well the S&P did the same thing last week, so we’re a bit overdue in redrawing that one. Here’s the previous trendline with the December break: […]

]]> By: Will http://dummyspots.com/2007/01/time-to-draw-some-new-trendlines/#comment-840 Will Sat, 13 Jan 2007 02:12:32 +0000 http://dummyspots.com/2007/01/time-to-draw-some-new-trendlines/#comment-840 B2C - thanks... it was one of those "catharsis" writings I've just gotta get out of the way once in a while to unblock the pipe :-) B2C - thanks… it was one of those “catharsis” writings I’ve just gotta get out of the way once in a while to unblock the pipe :-)

]]> By: Born2Code http://dummyspots.com/2007/01/time-to-draw-some-new-trendlines/#comment-809 Born2Code Fri, 12 Jan 2007 05:18:15 +0000 http://dummyspots.com/2007/01/time-to-draw-some-new-trendlines/#comment-809 yep, i realize that you are using trader vic's method. that's why the 2B top, aka taking out the stops, occurred to me. i happen to be re-reading the book these days, and i also concur, he is awesome. i also want to thank you for your earlier post, people are strange. great post, great story. yep, i realize that you are using trader vic’s method. that’s why the 2B top, aka taking out the stops, occurred to me.
i happen to be re-reading the book these days, and i also concur, he is awesome.
i also want to thank you for your earlier post, people are strange. great post, great story.

]]> By: Will http://dummyspots.com/2007/01/time-to-draw-some-new-trendlines/#comment-808 Will Fri, 12 Jan 2007 05:06:06 +0000 http://dummyspots.com/2007/01/time-to-draw-some-new-trendlines/#comment-808 Born2Code- thanks for the comment and the observation. I'm simply using Trader Vic's method of drawing a trendline so that it goes through the lowest minor low preceeding the highest high, without passing through <em>any</em> prices in between. Today's higher high is now the "highest high," so the line moves over to the low preceeding it. This is not to say that confirmation isn't necessary. In fact, today's action isn't a signal to trade at all, in my book. We could very well fail strongly, making this a "2B" top. Or we could thrust upward on surging volume, in which case I'll be jumping on board long at the first pullback. I completely agree with you that today's action isn't enough to take a position. However, a clear, rock-solidly consistent and repeatable method of drawing trendlines is a necessity in order to avoid the treachery of the "trendline Ouija Board" and drawing them so that we "see what we want to see." I chose Vic's method because it's simple, clear, and, well, I <em>love</em> him, man! BTW, as we know, a good linear regression will show us clearly the mathematical "trend" of a given period, and the "new" trendline as drawn is within about 2 degrees of being <em>perfectly</em> parallel to a linear regression line thru the trend of the last 6 months or so. I often compare them as a kind of "line confirmation," and this one matches up well, so I'm pretty comfortable with it. Thanks again for the visit! Born2Code- thanks for the comment and the observation. I’m simply using Trader Vic’s method of drawing a trendline so that it goes through the lowest minor low preceeding the highest high, without passing through any prices in between. Today’s higher high is now the “highest high,” so the line moves over to the low preceeding it.

This is not to say that confirmation isn’t necessary. In fact, today’s action isn’t a signal to trade at all, in my book. We could very well fail strongly, making this a “2B” top. Or we could thrust upward on surging volume, in which case I’ll be jumping on board long at the first pullback. I completely agree with you that today’s action isn’t enough to take a position. However, a clear, rock-solidly consistent and repeatable method of drawing trendlines is a necessity in order to avoid the treachery of the “trendline Ouija Board” and drawing them so that we “see what we want to see.” I chose Vic’s method because it’s simple, clear, and, well, I love him, man!

BTW, as we know, a good linear regression will show us clearly the mathematical “trend” of a given period, and the “new” trendline as drawn is within about 2 degrees of being perfectly parallel to a linear regression line thru the trend of the last 6 months or so. I often compare them as a kind of “line confirmation,” and this one matches up well, so I’m pretty comfortable with it.

Thanks again for the visit!

]]> By: Born2Code http://dummyspots.com/2007/01/time-to-draw-some-new-trendlines/#comment-807 Born2Code Fri, 12 Jan 2007 04:24:22 +0000 http://dummyspots.com/2007/01/time-to-draw-some-new-trendlines/#comment-807 the action is very bullish. i have a long term IRA account with about 20 diversified holdings of various size, various sectors, various countries... every single one of them was up today... i have not seen this screen completely green before. however, i am not sure i completely agree with your re-drawing of the trend line. at least not just yet. i think you are a bit early. this action may be "taking out the stops". I would be more comfortable with the new trend line when we print a higher low, or if the resistance we pushed thru on the third try becomes support. the action is very bullish. i have a long term IRA account with about 20 diversified holdings of various size, various sectors, various countries… every single one of them was up today… i have not seen this screen completely green before.
however, i am not sure i completely agree with your re-drawing of the trend line. at least not just yet. i think you are a bit early. this action may be “taking out the stops”. I would be more comfortable with the new trend line when we print a higher low, or if the resistance we pushed thru on the third try becomes support.

]]>