@ henri , komt van Andrews ( Pitchfork ) him zelf , heb het in mijn argief zitten ,
heb het in een pdf bestandje , hier staat het , heb het van Pastuiven , de eer komt hem toe
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The time frame of the trend under study must also be defined. Monthly, weekly, daily,
hourly, and even 15-minute price charts are available. For the purposes of the study,
daily charts for finding trends and defining pivots will be used:
Daily charts will be used to identify price trends
using Andrews trendline method.
Identification of Price Pivots
To summarize, a pivot will be chosen by identifying:
A reverse in price direction that reverses the previous
trend by violating the previous trendline.
Where,
Daily charts will be used to identify price trends
using Andrews trendline method.
Median Line as a Price Magnet
The best way to describe the expected outcome of the Median Line is by Andrews
himself, as well as those who studied his work and applied the method.
“What everyone wants to know is where the latest trend is headed, and where the
next pivot (P) will be from which the reverse trend will start. The probability of
the next P being at the latest ML seems to be about 80%, and even without any
additional rules that enable you to be constantly either long or short, the profit
potential of this simple rule is tremendous for you.”6
“Dr. Andrews found that his Median Line served as a magnet, drawing prices
toward it. He also discovered that once prices reached a Median Line, more often
than not they would reverse direction. By drawing a Median Line after a new
pivot had formed, he was able to see at a glance where prices would likely
reach...approximately 80% of the time. More often than not, in other words.”11
“Andrews always held that the Median Line is based on the law of physics. He
believed that principles from physics could be applied to financial markets…
These principles are that natural cycles return to their centers, and for every action
there is a reaction… When a swing in the financial markets returns to the Median
Line, it also completes one cycle. Andrews believed that the price returns to the
Median Line about 80% of the time.”10