A1ichae/ J Parsons

an entry in the opposite direction of the prevailing trend. To do th is

requires that a trading position be very closely monitored, but because
we have a break in the larger outside channel there is already a strong
indication that a reversal can be expected, even if we initially do not
know exactly when this will take place. It is a way of day trading a
market even if you normally do not day trade or an aggressive way
to extract extra profits if you do. This doesn't mean that you have to
suddenly drop everything that you are doing in order to watch the
markets. You are simply looking for an indication that the market
has reversed off the new high or low. Periodically checking a market,
having an alert sent to you, placing an order to enter if the market
moves off a new high or low by a certain amount, or half a dozen other
methods can have you in the market where you need to be. Figure 1-8
illustrates how this is done.

A word of caution, if you arbitrarily use this entry you will end up

.rMetaSiock
When the outside channel line (Line "A'� breaks. enter as the
accelerated secondary channel line (Line "B' � breaks
CIw1

being fooled by false signals and take frequent losses. So there are a
few qualifying factors to look for. First, the channel line should have
been part of a solid trend that had previously held back numerous
price bars. You need to have a trend that would naturally elicit a
strong reaction when it is broken, so we are not talking about a newly
formed trend here.
Second, the characteristic spike that shows up as the outside channel line
is broken should be an excessively long bar compared to the normal pace
of the market. There should be no question that this bar broke the channel

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