swing picks
Trading Home

levelSwing Trading Picks ] [ Swing Ideas ] [ Swing Charts ] [ Daily Stock Picks ] [ Trading Software ] [ Chart Patterns]

Stock Trading  Stock Trading - Technical Analysis, Trading stocks, Stock Charts, Trading strategies

Trading Education   Trading Ideas   Trading Strategies   Trading Tools



Limited Offer - 60 days Try-Out:
Try Forex Profit Accelerator For FREE
Special Time Limited Risk-Free Offer!

Protect & Grow your portfolio
Portfolio Prophet
AVOID market crashes

Forex Profit Multiplier
MULTIPLY your profit potential in 60 seconds or less of active trading

Continuation Chart Patterns

Trading stocks education - Trading tactics & examples

Price Channel Continuation

Price Channel is a price movement that is bound by an upper and lower trend line. The upper trend line marks resistance and the lower trend line marks support. Price channels with negative slopes are considered bearish and those with positive slopes bullish.

Basic pattern can also be used together with Price Channel of Elliot Wave Theory. Inspired by the Dow Theory and by observations found throughout nature, which the Elliott Wave Theory identifies a repetitive pattern of five waves in the direction of the main trend followed by three corrective waves. These waves are used to predict movement of the stock market. Ralph Nelson Elliott used Price Channels as a method of arriving at price objectives and to help confirm the completion of wave counts: Price Channel Technical Indicator...

Price Channel
Price Channel

Super Divergence Blueprint - Learn how to discover 'hidden' market moves. There are points in any market (stocks, forex, futures) where a "divergence pattern" occurs that could trigger a potentially huge market move that most trend-following methods would otherwise miss? Super Divergence Blueprint by ProfitsRun reveals how you can discover Hidden Trades with astonishing simplicity. » Click To Get More Info!

In a bullish price channel, some traders look to buy when prices reach main trend line support. Conversely, some traders look to sell (or short) when prices reach main trend line resistance in a bearish price channel. As with most price patterns, other aspects of technical analysis should be used to confirm signals.

  • Main Trend line: It takes at least two points to draw the main trend line. This line sets the tone for the trend and the slope. For a bullish price channel, the main trend line extends up and at least two reaction lows are required to draw it. For a bearish price channel, the main trend line extends down and at least two reaction highs are required to draw it.
  • Channel Line: The line drawn parallel to the main trend line is called the channel line. Ideally, the channel line will be based off of two reaction highs or lows. However, after the main trend line has been established, some analysts draw the parallel channel line using only one reaction high or low. The channel line marks support in a bearish price channel and resistance in a bullish price channel.
  • Bullish Price Channel: As long as prices advance and trade within the channel, the trend is considered bullish. The first warning of a trend change occurs when prices fall short of channel line resistance. A subsequent break below main trend line support would provide further indication of a trend change. A break above channel line resistance would be bullish and indicate an acceleration of the advance.
  • Bearish Price Channel: As long as prices decline and trade within the channel, the trend is considered bearish. The first warning of a trend change occurs when prices fail to reach channel line support. A subsequent break above main trend line resistance would provide further indication of a trend change. A break below channel line support would be bearish and indicate an acceleration of the decline.
  • Scaling: Even though it is a matter of personal preference, trend lines seem to match reaction highs and lows best when semi-log scales are used. Semi-log scales reflect price movements in percentage terms. A move from 50 to 100 will appear the same distance as a move from 100 to 200.

* * *

Swing Trading:   Futures Trading | Quantum Swing Trader | Day Trading | Trade Forex
   Quantum Swing Trader  ~  Swing Trading Principles  ~  UMT  ~  ETF  ~  Trading Videos

  Trading Tactics
  Chart Patterns
  Swing Trading
  Trading Gaps
  Elliott Wave Trading
  Strategy Guide
  Technical Analysis
  Trading Software
  Trading Stock Picks
  Trading Commentary
  Daily Trading Signals
*   BDY
*   HAS
*   ADRX
*   GOOG
*   MSFT
*   MICU
*   PETM
*   SBGI
*   SHOP
*   SOLF
ChartPattern Trading $ystems
Dan Zanger Offers You 3 week FREE trial!

Shopping: Products & Services

Swing Trading Daily Blog     Swing Trading Ideas
Trading - VIII   VII   VI   V   IV   III   II   I   XII   XI   X   IX

Trading Tutorials   Pattern Cycles Highs, Bottoms, Breakouts, Declines, Reversals, Tops, Trends | On Bottoms | Adam & Eve Tops | Adam-Eve-Adam | Bilateral Setups | Bollinger Band Tactics | Market Physics | 5 Fibonacii Tricks | Hell's Triangle | MA Crossovers | OverBought / OverSold | The Big W | Time Trading | Voodoo Trading


Futures Trading Room

Forex Trading Room

Sharks     Great White Shark     Shark Attacks     Med Sea Sharks
               Wizard of ID