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Technical Analysis Explained, Fifth Edition: The Successful Investor's Guide to Spotting Investment Trends and Turning Points, 5th Edition by Martin J. Pring

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6 TRENDLINES

Trendlines are perhaps the simplest of the tools we use in the technical arsenal and are arguably one of the most effective. Since the construction of nearly all price patterns requires the use of trendlines, this concept is a fundamental building block of pattern identification and interpretation—the subject of Chapter 8. In this chapter, we will describe trendline characteristics and explain how the significance of individual lines can be determined.

A trendline is a straight line connecting either a series of ascending bottoms in a rising market or the tops of a descending series of rally peaks. Those joining the lows are called up trendlines, and those connecting the tops are referred to as down trendlines. It is also possible ...

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