| Warning Line (WL or W) of nearby shift of major trend:
When you draw the MPL from P1 in Sep ’65 your CL to measure Action and
Reaction distances from, you see that this MPL line is also the ML. So
1ML2-3 is also the MPL. So by measuring the distance (A or Alan marked
on chart) that P2 is from that CL, you know that P3 will be where
prices meet the R1 line. And if you draw another H line the same
distance that A1 and R1 were from the CL, that line will be your
warning line, that indicates that the decline signaled when prices
falling from P4 crossed the MLH of 1ML2-3, was about to end. Similarly
with P2MLP3-P4, you draw the “dot dash” warning lines that signal you
to look for another P from which reversals occur. Since a Gap is 2Ps
you see Gs at P6 and where prices rise for a fast move up in Apr ’68 as
they cross the P6ML7-8. You’ll also see that even where prices pass the
W lines they usually double back to it at least even if the original
trend toward that W line is resumed. But usually there is a worthwhile
reversal as shown by the W for the PrML6-7 where prices reversed from
the 370 area on signal at 360 in AP ’68 to the 320 area the next week. |
 |
| Click To Enlarge |
|
|
|