Andrews Pitchfork is a technical tool that's regarded one of the advanced techniques of trend lines, and it consists of 3 lines that act as support and resistance levels and as limits to the trading price movement, a middle line that evinces the average directional movement, and upper and lower limits to determine the directional movement, and it is used to distinguish the expected breakout and retracement fields for price movement, and aids in tracking trends powerful.
Drawing method of Andrews Pitchfork:
The Andrews Pitchfork drawing tool is available in most of the trading and analysis software and platforms in the markets like MetaTrader, and you only need to determine three points
On the up trend
1: the bottom of the starting of the movement
2: the apex of the starting of the correction
3: bottom end correction
On the down trend
1: the top of the starting of the movement
2: the bottom of the starting of the correction
3: apex end correction
Uses
As trend lines, Andrew's fork is usually used as inclined support and resistance for price movement, as the price arrival one of the limits intends directionally reaching a saturation area
In the up trend:
Arrival the lower limit indicates oversold (which is generally the end of a corrective move), and the possibility of a bring back to the upside – thus buying
Arrival the upper limit means overbought (which is generally the beginning of a corrective movement), and supports the idea of taking profit - while ignoring the sale
In a down trend:
Arrival the upper limit indicates overbought (which is generally the end of a corrective move), and the possibility of a return to the downside – hence selling.
Arrival the lower limit indicates oversold (which is generally the beginning of a corrective movement), and supports the idea of taking earnings - while ignoring the buying
Related Pages:
Technical Analysis schools
Price Channels
Trend is your Friend
No comments:
Post a Comment