DJ Transports iShares - IYT - 1 YR Broken trendline - H&S Top

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Chart says a lot of damage has been done.

150 massive resistance... Sell here & sell at 149

Downside open-ended here.


12:41PM EST
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Yup..good one Tim
+1 Reply
This has been a nice, wild ride. Selling rallies, buying dips, selling rallies = probably overtrading this, but "don't count your money while you're sitting at the table" applies nicely...
+2 Reply
Working exceptionally well here at 144... I might double-up and put a breakeven stop - this one looks like it could be a big winner. My risk? Giving away a nice profit in exchange for a monster profit.
timwest timwest
It's hard to follow, because I didn't post here that I covered right after I posted this - I didn't feel like doubling up, so I covered. Sorry if that is confusing to anyone.
timwest timwest
timwest timwest
Thank link shows that I posted a chart and covered my short.
Tim, I enjoy reading your posts, thanks for publishing them. With respect, does your trendline need to be revisited? I was taught trendlines do not pass through ANY points when it's being drawn (as per, Trader Vic, Methods of a Wall Street Master). If one accepts that, the trend line on the daily chart could be drawn to connect the Feb low with the price low made in mid-April of this year. If one accepts that line, the IYT actually boounced off the trend line that would correspond with that. Does this make sense?

If your trendline is drawn from some previous point, as it looks like yours might be, it appears its angle would have to be changed to incorporate but not pass through lows made in mid-April in any case, which would again have IYT bouncing off of such a line. I'm not trying to bash your work, as I've really enjoyed reading it, and I'm new to this community as well I was more trying to start a dialogue. And I'm not saying I disagree with your conclusion, particularly if IYT rallies up to 150 and is rejected over the next week.
+1 Reply
timwest KevinWeatherly
I am not a believer that trend lines can not pass through other prices. In fact, everything I have seen in my 28 years of charting tells me to only look at trend lines that don't connect through price extremes. There are a few reasons why. Before I answer though, there are a lot of charts that I have posted here and it would be great if I could send you to look through them and see which ones worked and which ones didn't and the reasoning for them, etc. I'm happy to point out how I do things differently and I think it is also useful to see how "everyone else" is looking at something to look for differences and at how other people will be reacting to a technical event. That said, I'm a big believer in "price levels", not trend lines. I believe in fundamental events and knowing when certain things happen in a chart so you have those as reference points. I believe that people don't think in trend lines. People think in levels. Absolute levels. Levels that don't change. They memorize levels. So, when you look through some of my work you can see that I try to explain things as best as I can to help you understand why I do it differently. Would you mind taking a look at 20-30 more charts of mine and see what you can see? I think you will see that I explain myself here and there. Look in the chart and also look in the text underneath. If you can, look at my youtube videos too that go over some of the key levels and methods. All the best to you. Keep the questions coming! Tim
+4 Reply
2use timwest
I second that . I went through probably 100+ Tim's charts, some indeed did not work, some did - my own personal opinion even is that his longs are slightly better than his shorts :) - but in any case they were highly educational and interesting. I would also add that price extremes are probably better used within day trading, but on larger charts its the range, the levels - just because people are given time to study and make decisions (day trading is more like a gunslinger "fastest hand in the west" game)
To comment on the longs vs the shorts: It's been a bull market :-)
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