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 Patterns


Support and Resistance Lines
The Importance of Support and Resistance Understanding how support and resistance lines work is important; understanding how to use them is invaluable!

Banded Support and Resistance: COMS 3Com stock has been oscillating for the past four months...

Breaking Below Support: AVEI Ever since AVEI broke below support at 33, there has been continued weakness in the stock...

Banded Support and Resistance: ASAI What are the funny horizontal green lines on the ASA Holdings (ASAI) price graph?

Staircasing: PIXR Pixar, besides having a really cool corporate name, lives its life in a most interesting manner of periodicity...


Trend Lines
Descending Triangle: IDTC
Between April and August, IDTC was caught in what we call a "descending triangle"...

Descending Triangle: CCR
Countrywide broke out on the upside of a descending triangle in the beginning of June...

Ascending Triangle: LU
In the beginning of June, Lucent entered an ascending triangle configuration...

Pennant: CPQ
Between February and July, Compaq Computer formed a very clear pennant...

Head-and- Shoulders Top: GPS
The head-and-shoulders top is a tenet of classical charting theory...


Price Action
Gap Down in Prices: MSPG
The support line at $26 dollars is a very important line for MindSpring shares...

Downtrend in Prices: GGP
General Growth Properties (GGP) is in a classic downtrend...

Uptrend in Prices: PLP
An uptrend in prices is a series of higher highs and higher lows...

Double Bottom: XOMA
Trade in Xoma Corp (XOMA) is taking a turn for the bullish in the form of heavy buying...

Double Bottom: UK
Trade in Union Carbide (UK) is taking a turn for the bullish in the form of heavy buying...






Remember searching for images in the clouds as a child? Pictures of faces or trees...

Looking for patterns in the price action of a stock is really not much different. It's merely finding shapes on a graph that help you identify patterns in the way the price moves. Sometimes, the patterns can even predict the future action of a stock's price.

In this section, you'll learn:

  • About support, resistance, and trend lines
  • How to use them to determine price action
  • The significance of gaps in prices
  • How to identify certain patterns




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