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Saturday, May 29, 2010 1:30:05 PM
Quad Tunnel Charting Part 1C
On this lesson I need to point out one more aspect of the Quad Tunnel that must be understood...the current angle of rise or fall of the tunnel.This is very important.
If the tunnel is pointing down with a steep angle then I assume the market is commited to selling/shorting the rallies.
If the tunnel is rising at a good steep angle I assume the market is commited to buying on the dips.
If the tunnel is trending more or less sideways I assume the market is uncommited and is trading in consolidation.
If the tunnel has been pointing down and begins to flatten or level out I assume breakout to topside is a high probability and sellers are drying up.
If the tunnel has been pointing up and begins to flatten or level out I assume breakdown is a high probability and buyers are drying up.
This chart is a 30 minute EUR/USD and shows all conditions I just mentioned.Study it well and you can easily see all I pointed out.
Note:The EMA(62) gives the early warning on all conditions I spoke of in the above text.Its the first responder since its app 1/2 the EMA period of the EMA(121) ...the lowest value of tunnel component.
On this lesson I need to point out one more aspect of the Quad Tunnel that must be understood...the current angle of rise or fall of the tunnel.This is very important.
If the tunnel is pointing down with a steep angle then I assume the market is commited to selling/shorting the rallies.
If the tunnel is rising at a good steep angle I assume the market is commited to buying on the dips.
If the tunnel is trending more or less sideways I assume the market is uncommited and is trading in consolidation.
If the tunnel has been pointing down and begins to flatten or level out I assume breakout to topside is a high probability and sellers are drying up.
If the tunnel has been pointing up and begins to flatten or level out I assume breakdown is a high probability and buyers are drying up.
This chart is a 30 minute EUR/USD and shows all conditions I just mentioned.Study it well and you can easily see all I pointed out.
Note:The EMA(62) gives the early warning on all conditions I spoke of in the above text.Its the first responder since its app 1/2 the EMA period of the EMA(121) ...the lowest value of tunnel component.
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