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Cocks, Product The bar charts are: High-low charts or Line charts High-low-close charts or Sometimes we use line charts, especially for Open-high-low-close charts Elliott wave analysis. A line chart is the simplest of One single bar shows the high and the low of the all methods. It is constructed by joining together respective trading period. A vertical bar is used to the closing price of each period, for example daily connect the high and the low. Horizontal lines are closings for the daily line chart, weekly closings used to show the opening price left of that spe- for the weekly chart or monthly closings for the cific trading period and the closing price right at monthy line chart.

Support lines are horizontal lines that start at a recent extreme of a cor- rection low and also point toward the future on the time axis. An uptrend continues as long as the most recent peak is surpassed and new peak levels are reached. A downtrend continues as long as past lows are broken, sustaining a series of lower lows and lower highs. Notice that the previous support often becomes resistance and resistance becomes support. A resistance or a support line becomes more important and breaks above or below these lines gain more credibility as the number of price extremes peaks for resistance; or lows for support that can be connected by a single line increases.

Some examples for Microsoft are shown on the chart above. Microsoft reached a high of 19 in July The price started to correct from there and Microsoft remained below this level until February The 19 level became the resistance, meaning that only if 19 the highest peak so far in the uptrend had been broken on the upside would the stock have confirmed its uptrend. The same is true for the peak at 30 in July The uptrend was confirmed when the price rose above this resistance in November Support levels are positioned for example at 11, 15, As long as the price pushes above past peaks resistance levels and holds above past support levels does not break them the uptrend remains intact. The same is true for the bear trend. The downtrend remains intact as long as the price falls below the recent lows support levels and fails to rise above past resistance levels. A bearish trend reversal occurs when the price breaks through the most recent support after failing to rise above the most recent resistance.

A bullish trend reversal occurs when the price penetrates the most recent resistance after holding above the most recent support. The trendline is nothing more than a straight line drawn between at least three points. In an upmove the low points are connected to form an uptrend line. For a downtrend the peaks are connected. The important point is that it should not be drawn over the price action. Trendlines must encorporate all of the price data, i. connect the highs in a downtrend and the lows in an uptrend. The trendline becomes more important and gains credibility as the number of price extremes that can be connected by a single line increases. The validity and viability of a line that connects only two price extremes for example the starting point and one price low is questionable. The trend is broken when the price falls below the uptrend line or rises above the downtrend line.

The chart above shows Intel´s rise from July to March Most often inves- tors take profits much too early. Stay with a trend until it breaks, avoiding the urge to sell too soon because the profit could be higher than you originally thought. It is imperative to differen- tiate between a short-term, a medium-term and a long-term trend. If somebody tells you to buy the US dollar because it is likely to rise, make sure you understand whether the dollar is expected to rise over a few days or a few months and if you should buy the dollar with the intention to hold it for several days, several weeks or several months. For a technician on the trading floor, the long-term horizon is entirely different from that of an institu- tional investor. For a trader, long-term can mean several days, while for the investor, it can mean 12 to 18 months. We can compare the charts and indicators to a clock shown above. Short-term trends the seconds are best analyzed on daily bar charts.

Medium-term trends the minutes are best seen on weekly bar charts and long-term trends the hours are best seen on monthly bar charts. Some investors only want to know the hour, some want to know the seconds and some want to know the exact time. The best investment results are achieved when all three trends on the daily, weekly and monthly charts point in the same direction. It is also called the PRIMARY trend the Hours. It was broken by the decline. The long-term uptrend is not a straight line, but is interrupted by corrections of a smaller degree. They are also called SECONDARY trends. The medium- term correction is also not a straight line, but is made up of smaller corrections. Uptrend: Downtrend: 3 These smaller trends are the short-term Higher peaks and Lower peaks and trends. They are also called MINOR trends the higher troughs lower troughs Seconds. A minor downtrend can be part of an intermedi- Sideways trend or consolidation: ate-term uptrend, which itself can be part of a Horizontal peaks and troughs longer-term primary downtrend.

Sometimes it is difficult to differentiate between a short- and a medium-term or a long-term trend. Technical analysis helps you to differentiate be- tween the various trends in all financial mar- kets and instruments. They smooth out fluctua- Price tions in market prices, thereby making it easier to 80 determine underlying trends. Its calculation is shown above in mathemati- 40 cal form and displayed in the chart on the right. You add each new closing and skip 10 the oldest. Thus, the sum of closings always re- mains constant at 5 days. In most of our research, we use the moving average length out of the Fibonacci series see page To analyse the short-term trend, we use the day and day averages.

For the medium-term trend, we use the day and day averages. For the long-term trend, we use the day and day averages. Moreover, we also analyze very long-term trends, the so-called secular trends with the day, day, day and day moving averages. For example: a day simple moving average SMA would include the last 21 days of data divided by 21, resulting in an average see chart above for the Dow Industrial Index. This can be calculated at any given time using the last 21 days; hence, the average moves forward with each trading day. Generally a buy signal is generated when a price breaks above the moving average and a sell signal is generated by a price break below the moving average. It is added confirmation when the moving average line turns in the direction of the price trend.

The moving average naturally lags behind price movement, and the extent by which it lags or its sensitivity is a function of the time span. Generally, the shorter the moving average, the more sensitive it is. A 5-day moving average will react more quickly to a change in price than the day moving average, for example. However, the 5-day moving average is more likely to give false signals and "whipsaw" than the day one, which gives signals later and suffers from opportunity loss. Generally, if the market is trending in an uptrend or downtrend , a longer time period would be used. If it is ranging consolidating , the shorter time frame will catch the minor moves more easily. Moving averages can act as support and resistance as shown by the arrows on the chart above for the Dow Jones Industrial Index , similar to the support and resistance dis- cussed on pages 8 and 9. They are shown on the three charts on this page. short-term trend The direction of the moving averages indicates the direction of the three basic trends in force.

February April May June July Instead of showing the moving averages on three separate charts to illustrate the three basic trends, we more often display all moving averages on a single daily chart. This is shown on the next page. The long-term moving average is not shown on the monthly chart, but on the daily chart. The medium-term moving average is also shown on the daily chart instead of the weekly chart. The day moving average is shown here for the short-term trend, the day moving average for the medium-term trend and the day moving average for the long-term trend. Displaying the three moving averages on one single chart provides important signals based on the moving average trends and crossovers. BUY and SELL signals are given - when the price crosses the moving average - when the moving average itself changes direction and - when the moving averages cross each other A short-term trading buy signal B1 is given when the price rises above the day moving average.

The buy signal is confirmed when the day average itself starts rising. A short-term trading sell signal S1 is given in the opposite direction. A medium-term tactical buy signal B2 is given when the price breaks above the day moving average. It is confirmed when the day average crosses above the day average and the day average itself starts rising. A medium-term tactical sell signal S2 is given in the opposite direction. A long-term strategic buy signal B3 is given when the price rises above the day moving aver- age. It is confirmed when the day average crosses above the day moving average and the day average itself starts rising. A long-term strategic sell signal S3 is given in the opposite direction. In financial markets it is measured by 60 60 the speed of the price trend, i.

whether a 40 trend is accelerating or decelerating, rather than 50 the actual price level itself. They give signals before the price trend Momentum 5-day rate-of-change 10 turns. But once momentum provides a signal it indicator Zero line LEFT SCALE 0 has to be confirmed by a moving average 1 4 7 10 13 16 19 22 25 28 31 34 37 40 crossover. Time - Days Instead of calculating the moving average of the sum of 5 days see page 12 , here we calculate the difference over a constant 5-day period for a 5-day rate of change. This is shown on the chart above together with the zero line. If today´s price is higher than five days ago, the indicator is positive, i.

above the zero line. If the price continues to rise compared to five days earlier, the indicator rises. If the price today is lower than five days ago the indicator is negative, i. below the zero line. The rate of change oscillator is rather volatile. Therefore, we have smoothed it out see blue line so that it provides easy-to-read directional change signals as explained on the next page. The moving aver- ages are always displayed on the same chart and with the same scale as the price from which they are calculated. The momentum indicators are calculated using the price difference rather than adding the prices as with the moving averages. This is why the momentum indicators are displayed with a different scale than the price scale. On the chart above, it is shown by the scale to the left. When prices rise and the momentum indicator also rises, the price uptrend accelerates. When prices rise and the indicator falls, the price uptrend decelerates.

When prices fall and the momentum indicator falls, the price downtrend accelerates. When prices fall and the indicator rises, the price downtrend decelerates. Therefore, momentum indicators have to be applied together with the moving aver- ages. The momentum oscillator can be in one of four quadrants: Up quadrant u : Oscillator below the zero line and rising. Advancing quadrant a : Oscillator above the zero line and rising. Down quadrant d : Oscillator above the Zero line and declining. Terminating quadrant t : Oscillator below the Zero Line and declining.

The indicator is shown above in an idealized form bell curve. The same oscillator applies on monthly, weekly or daily charts to identify the long-, medium- and short-term momentum. It is the length of the time axis that differentiates the three time horizons. A real-time example is shown on the next page for IBM on the weekly chart. The phase, i. e reversing upwards at an oversold level. Expect a price indicator is reversing downwards at an overbought level. Expect a uptrend to start. Liquidate longs. Sell short! the indicator is becoming neutral: indicator is declining through the "d"own phase towards the zero Expect the uptrend to continue. Add to longs! Expect the downtrend to continue. Add to shorts! It is shifting from the "u"p phase to the indicator crosses below the zero line. It is shifting from the "d"own "a"dvancing phase.

An uptrend reversal is unlikely. Expect the phase to the "t"erminating phase. Expect the downtrend to uptrend to continue: Hold! Expect the phase to the oversold level. Expect the downtrend to bottom out uptrend to enter the top soon. Get ready to sell! Get ready to buy! Buy when a reversal from "t" to "u" occurs. The monthly or long-term momen- tum indicator tracks the long-term trend, roughly a month rate-of-change. The weekly, me- dium-term or intermediate-term momentum in- dicator roughly a week rate of change tracks   the medium-term trend while the daily or short- term momentum indicator roughly a day rate Short-term momentum oscillator of change tracks the short-term trend.

means the uptrend is slowing. Likewise, investors should start selling if the momentum indicator tops out and sell more if the price falls below the moving average. Thus, a combination of the signals given by the momentum oscillators, moving averages, and support and resistance should be applied. We do the same analysis here with the momentum indicators. We show all three momentum indicators on the daily chart together with the short-term, medium- and long-term moving averages. The US dollar was trading above the rising day average and the long-term momen- tum indicator was rising until it topped in September. The momentum indicator´s top was soon con- firmed by the dollar´s fall below the day average in September and October.

The long-term top was also indicated by the negative divergence dashed blue line in the medium-term momentum indicator, which registered a lower high in September compared to its high in March. Thus it did not confirm the new price high in the US dollar at CHF 1. The medium-term trend was bullish from September until March when the weekly indica- tor topped and the US dollar fell below the slowing day average. The medium-term top in March was also indicated by the negative divergence of the daily momentum indicator, which did not confirm the new high in the US dollar in February at 1. The daily indicator registered a top that was lower than the top in January.

The day average is monitored in combination with the daily short- term momentum indicator, the day average with the weekly medium-term indicator and the day average with the monthly long-term momentum indicator. The most positive technical constellation is present when the price is above the short-term average, which in turn is rising above the medium-term average, which in turn is rising above the day moving average. AT THE SAME TIME, the daily, weekly and monthly momentum indicators are rising. The same is true in the opposite direction for the most negative constellation.

Sig- nals are given when the trend reverses an extreme lev- els. The oscillator sell signal acts like a rubber band: the further it stretches, the more the prices need energy to sustain the trend, i. a trend Zero line reversal should be expected the more stretched the mo- a d a d mentum indicator becomes. Sometimes signals leave room for interpretation tech- Very high-risk t speculative buy nical analyis is an art not a science. The indicator does signal not always cross the zero line before giving a new buy- or sell signal. These signals are called redistribution ex- Momentum indicator amples see scheme on the right and chart above or re-accumulation. Sometimes, the oscillator turns upwards again from a high level This is seen as a high-risk selling opportunity.

Most of the time, the above the zero line instead of bottoming below the zero line. This ensuing declines are short-lived and are, more often than not, fully is seen as a high-risk buying opportunity. Most of the time the retraced. ensuing price rallies are short-lived and are, more often than not, The pause and delay in the aberrated trend is often fully retraced. The same pattern can occur in the opposite direction psychologically quite unnerving for the investor. Therefore, patience when the indicator turns downward again from a low level below becomes a tactical requirement, allowing the major underlying the zero line still oversold instead of topping above the zero line trend forces to rebase at the adjusted price level.

overbought level. Medium-term momentum indicator above Zero and declining. Four stocks are shown on this page, each displaying the medium-term in- dicator in one of the 4 possible positions. In- vestors should look to buy stocks with a rising momentum indicator while selling the stocks with a falling momentum indicator. If we take 30 stocks in- stead of only 4 and calculate the medium-term indicator for each of the 30 stocks, we can calculate the number of stocks positioned in each cycle quadrant. The example above shows the 30 stocks in the Dow Jones Industrial Index. We use percentages so that we can compare different portfolios and markets with different stocks and different asset classes. The same percentage distribution is shown above for the long-term indicators and the short-term indicators. We do this type of momentum analysis for over stocks, 80 stock market indices, 40 commodi- ties, bond-futures and 40 interest rate series.

Also, for the US dollar against 40 currencies and the same for the Japanese yen, euro, Swiss franc and British pound each against 40 currencies. We search for those financial market series that are best positioned in bull phases. The indicators provide a clear outlook and objectivity for the broad market trends, allowing you to buy and sell against the backdrop of subjective emotional stress. You need to build trust in these indicators so that you can buy against the prevailing pessimism and sell against the prevailing optimism. It is a detailed description of how financial markets behave. The description reveals that there is a PSYCHE OF THE CROWD inherent in all representative financial market series. The crowd is not a physical crowd but a psychological crowd. It constantly moves from pessimism to optimism, from fear to greed and from euphoria to panic and back in a natural psycho- logical sequence, creating specific patterns in price movements.

The main point emerging from the Elliott Wave concept is that markets have form pattern. It is here that the investor finds determinism in a seemingly random process. Elliott discovered what the main initiator of the chaos theory, Benoit Mandelbrot, confirmed 50 years later in collaboration with Henry Houthakker, an economics professor at Harvard: that patterns made by taking very short-term "snap- shots" of stock prices, for example every day are similar to patterns formed by snapshots taken once a week, or once a month, or even once a year. Elliott isolated thirteen patterns.

He cataloged them and explained that they link together, and where they are likely to occur in the overall path of the market development. The basic pattern shows that markets move forward in a series of 5 waves 1 and 3 and two sets of three wave patterns 2 of 5 waves of psychological development from pessimism to and 4 , a final set of 5 waves materializes and completes the optimism. When these 5 forward waves are complete, a whole pattern. reaction sets in, taking place in 3 waves from optimism to At this point, after wave 5 is complete, there is now a set of pessimism. This set would correct the whole of the 5 to designate "3-wave" patterns. These 8 waves then complete upward waves, which themselves had each broken into 5 and a cycle from which a new series of 5 waves commences, to be 3 smaller waves along the way.

followed by another set of 5 waves. Given a series of 5- and 3- 36 5 wave patterns, the investor should be able to predict 34 the continuation of the next pattern until a larger wave pattern is completed. It is the knowledge of 32 these patterns that allows the investor to recognize when a trend change will occur before it has occured. The chart is taken from our real-time rec- 24 ommendation. We said in December that the long- term uptrend was not complete yet, and that at least 22 20 4 one more upleg wave 5 should be expected. Wave correlation suggested that the minimum price 12 target was around The price reached 36 in wave 10 5 and was immediately followed by a sharp correction.

Ultimately, the price completed another five-wave 8 2 pattern at Corrective patterns can become very complex and difficult to interpret. However, once a correction is completed, its form provides important information on the most likely path of the next impulsive wave. The chart above displays one of the most widely recognized patterns: the horizontal triangle. It is shown on the hourly chart of ATT between 27 October and late November between 65 and Soon after wave E was completed the stock broke out on the upside and reinstated its larger uptrend.

The triangle example above is one of a few thousand that we have seen developing. Some triangles are ascending, some are descending and some are expanding. Together with the Zigzags and Flats they make up the list of corrective patterns. What sets the wave principle apart and ahead of other technical approaches is primarily this character- istic of design and form. Each market pattern has a name and specific form determined by a small number of rules and guidelines. Yet, a specific pattern is never identical to another pattern of the same type. The patterns are variable enough in some aspects to allow for limited diversity within patterns of the same type. It is this "self-similarity" which makes up the difference between deterministic chaos and random-walk. At "3" on the graph above left, the uptrend is powerful, with no evidence of a top formation. Volume tends to pick up as higher highs are made. The dip to "4" on lighter volume is, at this stage, considered a correction within the broader uptrend.

The rally to "5" on diminishing volume alerts the technician that a top may be close at hand.

edu no longer supports Internet Explorer. To browse Academia. edu and the wider internet faster and more securely, please take a few seconds to upgrade your browser. A chartist analyzes price charts only, while the technical analyst studies technical indicators derived from price changes in addition to the price charts. Lim Kai Jie Shawn. In this study, we investigate the presence of psychological barriers in the equity indices of 10 Asian Markets over a 10 year period from This investigation was conducted through the use of uniformity tests, barrier proximity tests and tests on the predictability of stock returns.

We have found evidence for barriers at the level for 6 of these markets JKSE, KLSE, N, STI, KS11, TWII and at the level for 4 of these markets AORD, JKSE, KLSE, STI. However, while there may be evidence of psychological barriers, there is little evidence for the predictability of stock returns induced by the presence of these psychological barriers. Murat Ozbayoglu. Daan Gkr. Javier Rivera. Learn about the stock market and how to predict the market. Log in with Facebook Log in with Google. Remember me on this computer. Enter the email address you signed up with and we'll email you a reset link.

Need an account? Click here to sign up. Download Free PDF. technical ANALYSIS tutorial. R K Gupta. Continue Reading Download Free PDF. Related Papers. IFTA Journal, Edition Psychological Barriers in Asian Equity Markets. Download Free PDF View PDF. Procedia Computer Science TN-RSI: Trend-normalized RSI Indicator for Stock Trading Systems with Evolutionary Computation. Technical Analysis. As a result, investors should be aware that the Firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision. Technical analysis is the study of financial market action. The technician looks at price changes that occur on a day-to-day or week-to-week basis or over any other constant time period displayed in graphic form, called charts. Hence the name chart analysis. Technical analysts examine the price action of the financial markets instead of the fundamental fac- tors that seem to effect market prices.

Technicians believe that even if all relevant information of a particular market or stock was available, you still could not predict a precise market "response" to that information. There are so many factors interacting at any one time that it is easy for important ones to be ignored in favor of those that are considered as the "flavor of the day. These fac- tors, however, are discounted very quickly. Watching financial markets, it becomes obvious that there are trends, momentum and patterns that repeat over time, not exactly the same way but similar. Charts are self-similar as they show the same fractal structure a fractal is a tiny pattern; self-similar means the overall pattern is made up of smaller versions of the same pattern whether in stocks, commodities, currencies, bonds.

A chart is a mirror of the mood of the crowd and not of the fundamental factors. Thus, technical analysis is the analysis of human mass psychology. Therefore, it is also called behavioral finance. This means, if the fundamental news is positive the price should rise, and if the news is negative the price should fall. However, long-term analyses of price changes in financial markets around the world show that such a correlation is present only in the short-term horizon and only to a limited extent. It is non-existent on a medium- and long-term basis. In fact, the contrary is true. The stock market itself is the best predictor of the future fundamental trend.

Most often, prices start rising in a new bull trend while the economy is still in recession position B on chart shown above , i. while there is no cause for such an uptrend. Vice versa, prices start falling in a new bear trend while the economy is still growing position A , and not providing fundamen- tal reasons to sell. There is a time-lag of several months by which the fundamental trend follows the stock market trend. Moreover, this is not only true for the stock market and the economy, but also for the price trends of individual equities and company earnings. Stock prices peak ahead of peak earn- ings while bottoming ahead of peak losses. The purpose of technical analysis is to identify trend changes that precede the fundamental trend and do not yet make sense if compared to the concurrent fundamental trend. Ego and emotions determine far more of investors´ stock market decisions than most would be willing to admit. For years, we have dealt with professional money managers and committees and found they were as much subject to crowd following and other irrational emotional mistakes as any novice investor.

They were, for the most part, better informed, but facts alone are not enough to make profitable deci- sions. The human element, which en- compasses a range of emotions from fear to greed, plays a much bigger role in the decision-making process than most investors realize. In a practical sense, most investors act exactly opposite to the rational wisdom of buying low and selling high based on very predictable emotional responses to rising or falling prices. Falling prices that at first appear to be bargains generate fear of loss at much lower prices when opportunities are the greatest. Rising prices that at first appear to be good opportunities to sell ultimately lead to greed- induced buying at much higher levels.

Reason is replaced by emotion and rationalization with such cyclical regularity, that those who recognize the symptoms and the trend changes on the charts can profit very well from this knowledge. Investors who manage to act opposite to the mood of the crowd and against their own emotions are best positioned to earn money in the financial markets. Financial risk and emotional risk correlate inversely. Because, as we have seen, people are motivated by greed optimism when buying and by fear pessimism when selling. People are motivated to buy and sell by changes in emotion from optimism to pessimism and vice versa. They formulate fundamental scenarios based on their emotional state a rationalization of the emo- tions , which prevents them from realizing that the main drive is emotion. The chart above shows that if investors buy based on confidence or conviction optimism they BUY near or at the TOP. Likewise, if investors act on concern or capitulation pessimism they SELL near or at the BOTTOM.

Investors remain under the bullish impression of the recent uptrend beyond the forming price top and during a large part of the bear trend. Vice versa, they remain pessimistic under the bearish impression from the past downtrend through the market bottom and during a large part of the next bull trend. They adjust their bullish fundamental scenarios to bearish AFTER having become pessimistic under the pressure of the downtrend or AFTER having become optimistic under the pres- sure of the uptrend. Once having turned bearish, investors formulate bearish scenarios, looking for more weakness just when it is about time to buy again. The same occurs in an uptrend when mood shifts from pessimism to optimism.

Investors formulate bullish scenarios AFTER having turned bullish, which is after a large part of the bull trend is already over. Emotions are the drawback of fundamental analysis. Investors must learn to buy when they are fearful pessimistic and sell when they feel eu- phoric optimstic. This may sound easy simple contrary opinion , but without Technical Analysis it is hard to achieve. The main purpose of technical analysis is to help investors identify turning points which they cannot see because of individual and group psychological factors. For example, on the monthly chart, a bar indicates the high and the Four bar charts of the Swiss Market Index are low at which the SMI traded during that single shown above.

They are the most widely used month. chart types. The bar charts are: High-low charts or Line charts High-low-close charts or Sometimes we use line charts, especially for Open-high-low-close charts Elliott wave analysis. A line chart is the simplest of One single bar shows the high and the low of the all methods. It is constructed by joining together respective trading period. A vertical bar is used to the closing price of each period, for example daily connect the high and the low. Horizontal lines are closings for the daily line chart, weekly closings used to show the opening price left of that spe- for the weekly chart or monthly closings for the cific trading period and the closing price right at monthy line chart. Support lines are horizontal lines that start at a recent extreme of a cor- rection low and also point toward the future on the time axis. An uptrend continues as long as the most recent peak is surpassed and new peak levels are reached.

A downtrend continues as long as past lows are broken, sustaining a series of lower lows and lower highs. Notice that the previous support often becomes resistance and resistance becomes support. A resistance or a support line becomes more important and breaks above or below these lines gain more credibility as the number of price extremes peaks for resistance; or lows for support that can be connected by a single line increases. Some examples for Microsoft are shown on the chart above. Microsoft reached a high of 19 in July The price started to correct from there and Microsoft remained below this level until February The 19 level became the resistance, meaning that only if 19 the highest peak so far in the uptrend had been broken on the upside would the stock have confirmed its uptrend.

The same is true for the peak at 30 in July The uptrend was confirmed when the price rose above this resistance in November Support levels are positioned for example at 11, 15,

The value of securities and fluctuate and, in consequence, initial capital paid to financial instruments is subject to exchange rate fluc- make the investment may be used as part of that in- tuation that may have a positive or adverse effect on come yield. Shadows in the doji bar In many instances, the doji is just a plain one with ordinary, same-size shadows, as shown in Figure Visible demand begets more demand. Non e of th e ma terial, n or its co nten t, nor any Im portant discl os ures co py of it, may b e alte red in an y way , tr ansmitte d t o, copied or distribut ed to any Credit Suisse policy is to publish re se arch re port s, a s it d eems appr opr iat e, based on o ther pa rty , with out th e pr io r ex press w r itten permission of CS. I recommend books and Web work by John Person pivot points and candlesticks and Stephen Bigalow. Gaps almost never come in multiples. Support lines are horizontal lines that start at a recent extreme of a cor- rection low and also point toward the future on the time axis.

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