Comments on: Drawing Trendlines http://tradermike.net/2006/01/drawing_trendlines/ Trading, Stocks, Stock Market, Money Mangement & Risk Management Sat, 22 Nov 2008 14:43:06 +0000 http://wordpress.org/?v=2.6.3 By: Trader Mike http://tradermike.net/2006/01/drawing_trendlines/#comment-2320 Trader Mike Thu, 26 Jan 2006 00:48:38 +0000 http://www.tradermike.net/2006/01/drawing_trendlines/#comment-2320 <strong>More on Trendlines</strong> Chad left the following comment on my earlier post about drawing trendlines: I’m somewhat confused with your chart and I’m wondering if you can help me understand your methodology better. With that chart, why wouldn't the trendline be drawn... More on Trendlines

Chad left the following comment on my earlier post about drawing trendlines: I’m somewhat confused with your chart and I’m wondering if you can help me understand your methodology better. With that chart, why wouldn’t the trendline be drawn…

]]> By: Doc Dan http://tradermike.net/2006/01/drawing_trendlines/#comment-2319 Doc Dan Wed, 25 Jan 2006 22:56:22 +0000 http://www.tradermike.net/2006/01/drawing_trendlines/#comment-2319 Chad, Bruce, using candles vs bars or, more frequently, daily vs weekly, there will be some small imperfections in the trendline (call them errors if you like) due simply to the requirements for graphical presentation. If Mike had used the candlestick at the end of Oct as his second point for the trendline, the difference at the end of December would be very small. The point of Trader Vic's rules is that they are consistent and as rigorous as you care to make them. Having said that though, I will at times draw a tentative trendline (graphically "dashed") like the Technicator trendline, to see if it makes sense as a potential continuation of the trend at a lower rate of rise. Chad, Bruce, using candles vs bars or, more frequently, daily vs weekly, there will be some small imperfections in the trendline (call them errors if you like) due simply to the requirements for graphical presentation.

If Mike had used the candlestick at the end of Oct as his second point for the trendline, the difference at the end of December would be very small.

The point of Trader Vic’s rules is that they are consistent and as rigorous as you care to make them. Having said that though, I will at times draw a tentative trendline (graphically “dashed”) like the Technicator trendline, to see if it makes sense as a potential continuation of the trend at a lower rate of rise.

]]> By: Michael http://tradermike.net/2006/01/drawing_trendlines/#comment-2318 Michael Wed, 25 Jan 2006 19:52:11 +0000 http://www.tradermike.net/2006/01/drawing_trendlines/#comment-2318 Chad, Thanks for the kind words. Let me look answer your questions in a later post -- hopefully tonight Chad,

Thanks for the kind words. Let me look answer your questions in a later post — hopefully tonight

]]> By: Chad http://tradermike.net/2006/01/drawing_trendlines/#comment-2317 Chad Wed, 25 Jan 2006 19:30:23 +0000 http://www.tradermike.net/2006/01/drawing_trendlines/#comment-2317 Mike- I absolutely love your blog and I deeply appreciate that you take the time to make these posts to help those of us who are still infants to technical analysis. I’m somewhat confused with your chart and I’m wondering if you can help me understand your methodology better. With that chart, why wouldn't the trendline be drawn from your start point, to the dip that occurred back at the end of November? That line would have had several lows touching, or nearly touching the trendline. It would have exited the trend back in early December and signaled the beginning of a consolidation phase. Also, do you always draw to the bottom of the tail versus the body of a candlestick? Do you have any techniques to help discern what is possibly an aberration in the chart? I’m noticing that many charts would have perfect trendlines with the exception of a candle or two. Again, thank you for your wonderful blog and your insight. Mike-

I absolutely love your blog and I deeply appreciate that you take the time to make these posts to help those of us who are still infants to technical analysis. I’m somewhat confused with your chart and I’m wondering if you can help me understand your methodology better. With that chart, why wouldn’t the trendline be drawn from your start point, to the dip that occurred back at the end of November? That line would have had several lows touching, or nearly touching the trendline. It would have exited the trend back in early December and signaled the beginning of a consolidation phase. Also, do you always draw to the bottom of the tail versus the body of a candlestick? Do you have any techniques to help discern what is possibly an aberration in the chart? I’m noticing that many charts would have perfect trendlines with the exception of a candle or two. Again, thank you for your wonderful blog and your insight.

]]> By: Michael http://tradermike.net/2006/01/drawing_trendlines/#comment-2316 Michael Wed, 25 Jan 2006 18:56:20 +0000 http://www.tradermike.net/2006/01/drawing_trendlines/#comment-2316 If that candle was lower I would have started the trendline at that candle and NOT drawn through it. In fact, in my other charting platform, which is using a logarithmic scale, the trendline should start at the bottom of the October 28th candle. Either way it's drawn though, the S&P broke the trend. If that candle was lower I would have started the trendline at that candle and NOT drawn through it. In fact, in my other charting platform, which is using a logarithmic scale, the trendline should start at the bottom of the October 28th candle. Either way it’s drawn though, the S&P broke the trend.

]]> By: bruce http://tradermike.net/2006/01/drawing_trendlines/#comment-2315 bruce Wed, 25 Jan 2006 18:45:35 +0000 http://www.tradermike.net/2006/01/drawing_trendlines/#comment-2315 Question. The dark candle at the end of oct on the s&p chart appears to have been drawn through using vic's method. What if it had been even lower, without taking out the previous low? Would you draw the trendline right through this candle using vic's method? Question. The dark candle at the end of oct on the s&p chart appears to have been drawn through using vic’s method. What if it had been even lower, without taking out the previous low? Would you draw the trendline right through this candle using vic’s method?

]]>