CanOz
Home runs feel good, but base hits pay bills!
- Joined
- 11 July 2006
- Posts
- 11,544
- Reactions
- 521
I use trend lines in my trading, generally on the daily charts to mark support and resistance. I want to know where the stops are, especially a cluster of higher highs or lower lows, these can be great opportunities....
However, we tend to give too much weight to lines on a chart. To prove that these lines are pretty much useless and that we give them too much weight, try this exercise for a week.
Step 1:
Pick you favorite intra-day market and draw some random horizontal lines across and through the most recent range, save the chart or whatever you need to do to keep the lines.
Step 2:
After the next session, check the chart and see how the market "reacted" to the lines. Rinse and repeat.
Have fun.
CanOz
However, we tend to give too much weight to lines on a chart. To prove that these lines are pretty much useless and that we give them too much weight, try this exercise for a week.
Step 1:
Pick you favorite intra-day market and draw some random horizontal lines across and through the most recent range, save the chart or whatever you need to do to keep the lines.
Step 2:
After the next session, check the chart and see how the market "reacted" to the lines. Rinse and repeat.
Have fun.
CanOz