This is more or less how Demark Trendlines work.
Connect two more recent lows (shadows) from right to left, called DM points N. Condition - each N has to have 3-6-9-12...20 candles (you decide the number)
above the low on both sides. The bigger number the more serious is the low. Usually they use like 3-10 candles on both sides.
Both lows have to have similar amount of candles.
The same applies to the downtrends - you connect 2 most recent descending highs, from right to left.
The ideal would be when the swing to the upside (before the breakdown) would be bigger (overextension, overbuying, auction final).
You measure target by the length of the inner bow and project it from breakout.
I noticed it works well with Demark Daily Pivot boxes. Breakout of R1 or S1 usually coincides with Demark trendline breakout.
Daily Demark S1 or Demark R1 hold trends on hourly incredible well (better that Ichimoku or any MA). Those are great for stops.
Breakout of daily Demark S1 or Demark R1 is the first sign of trend change.
I am still learning this so...
Connect two more recent lows (shadows) from right to left, called DM points N. Condition - each N has to have 3-6-9-12...20 candles (you decide the number)
above the low on both sides. The bigger number the more serious is the low. Usually they use like 3-10 candles on both sides.
Both lows have to have similar amount of candles.
The same applies to the downtrends - you connect 2 most recent descending highs, from right to left.
The ideal would be when the swing to the upside (before the breakdown) would be bigger (overextension, overbuying, auction final).
You measure target by the length of the inner bow and project it from breakout.
I noticed it works well with Demark Daily Pivot boxes. Breakout of R1 or S1 usually coincides with Demark trendline breakout.
Daily Demark S1 or Demark R1 hold trends on hourly incredible well (better that Ichimoku or any MA). Those are great for stops.
Breakout of daily Demark S1 or Demark R1 is the first sign of trend change.
I am still learning this so...
Comment:
The breakdown occured at 8 AM New York time - when American banks opened.
Significance of trends are as follows:
N = 3 - minor trend, insignificant
N = 10 and more - MORE IMPORTANT TREND (less likely the breakout is false)
N = 30 GLOBAL TREND