🚀 LESSON 1: Pitchfork long-term channel creation $BNB
⭐STEP 1: Create Two Parallel Lines
Identify Key Pivot Points:
Start by identifying three significant pivot points on your chart, which are essential for constructing the Andrews Pitchfork. These points are typically major highs and lows that can help outline the overall trend.
⭐STEP 2: Adjust and Refine the Channel
Fine-tuning:
Adjust the pivot points if necessary to ensure the pitchfork accurately represents the trend. This may involve moving the points slightly to fit the highs and lows more precisely.
⭐STEP 3: Analyze the Channel
Price Interaction:
Observe how the price interacts with the pitchfork lines. The central line often acts as a magnet for price movement, while the upper and lower lines provide potential support and resistance levels.
Trend Confirmation:
Use the pitchfork to confirm the current trend. If prices consistently respect the pitchfork lines, it reinforces the validity of the trend. Conversely, frequent breaches of these lines may indicate a weakening trend or impending reversal.
⭐STEP 4: Set Trade Entries and Exits
Entry Points:
Consider entering trades near the lower median line (LML) in an uptrend or near the upper median line (UML) in a downtrend. These areas often provide favorable risk-reward ratios.
Exit Points:
Set profit targets near the central median line (ML) or the opposite parallel line, depending on your trade direction. Use additional indicators or price patterns to confirm exit points and manage risk.
NOTE: Don't forget to set the diagram to the "logarithmic" view!
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