January 2012
Intermediate to advanced
624 pages
17h 49m
English
Chapter 19
Dueling Lines: Wedge Pullback to the Trend Line
When a pullback is contained by a trend channel line and it ends at a higher time frame support or resistance line, this is a dueling lines pattern, and it often results in a reliable trade in the direction of the larger trend. It is a short-term trend (a pullback) ending at the long-term trend's support (in a bull trend) or resistance (in a bear trend). All pullbacks end in dueling lines patterns, although the support or resistance line is not always obvious. Any type of support or resistance can be the area where strong hands will come in and put an end to the pullback. Whenever traders see a pullback approaching a trend line, a trend channel line, a moving average, a prior swing low or high, or any other key price level, they should be alert for a setup that will lead to the end of the pullback and the resumption of the trend. When they see the setup, they are in a position to make a great trade. Remember, trading is becoming increasingly controlled by mathematics, and pullbacks end for a reason. A pullback in a bull trend always ends at a support level, and a pullback in a bear trend always ends at a resistance level, and therefore all pullbacks are dueling lines patterns. However, I reserve the term for those pullbacks where the support or resistance is seen by the trader, so that he can anticipate the possible trend resumption and place a trade. The most reliable form is when the pullback is in a channel and it has ...
