Summary Book 2 - Chart Patterns (Chapter 2)

For Up Trendlines
3 points on a trendline is valid.
draw the trendline along two minor lows in a forming price to see where the 3rd point may be.
a trendline starting with two close touches may not hold up in the longer term.
two points spaced too far apart may not have much value.
On average, trendlines with touches spaced widely apart perform better than those spaced close together.
on average long trendlines perform better than short ones
increasing the volume of stock as the trend continues is a good sign.
a breakout occurs when prices close below the trendline.
a high volume downward breakout propels prices further.

a plunge is a price trend that shows little price overlap from day to day leading to, but not including the breakout day.

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