As of 09/26/2023   Indus: 33,619 -388.00 -1.1%     Trans: 14,819 -282.19 -1.9%     Utils: 845 -24.76 -2.8%     Nasdaq: 13,064 -207.71 -1.6%     S&P 500: 4,274 -63.91 -1.5%	YTD  +1.4%    +10.7%   -12.7%    +24.8%    +11.3%	Targets    Overview: 09/15/2023     34,500 or 33,150 by 10/15/2023   15,900 or 14,800 by 10/01/2023   880 or 800 by 10/15/2023   14,400 or 13,000 by 10/01/2023   4,425 or 4,175 by 10/15/2023
Chart Pattern Indicator: on 9/15/23

As of 09/26/2023   Indus: 33,619 -388.00 -1.1%     Trans: 14,819 -282.19 -1.9%     Utils: 845 -24.76 -2.8%     Nasdaq: 13,064 -207.71 -1.6%     S&P 500: 4,274 -63.91 -1.5%	YTD  +1.4%    +10.7%   -12.7%    +24.8%    +11.3%
Targets    Overview: 09/15/2023     34,500 or 33,150 by 10/15/2023   15,900 or 14,800 by 10/01/2023   880 or 800 by 10/15/2023   14,400 or 13,000 by 10/01/2023   4,425 or 4,175 by 10/15/2023
Chart Pattern Indicator: on 9/15/23

Bulkowski on Trendline Mirrors

Trendline Mirrors: Summary

Trendline mirrors seem to reflect price across a trendline. That's useful when trying to predict how far price will move in the future.

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My book, Trading Basics, shown on the left, covers trendline mirrors starting on page 111.

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The figure shows an example of a trendline mirror in Boeing on the daily scale.

Notice how the vertical distance at A mirrors the drop to D, not in shape but in extent. The reflection isn't a smooth one, but that's ok. It's the distance that interests us most (well, me, anyway). The BA move upward reflects across the trendline almost exactly to CD.

To use this method, starting from the breakout, C, find the highest distance from the most recent peak to the trendline directly below. That's the AB distance.

From the breakout apply this distance downward to get a price target (the price at C minus the AB distance). That method works 63% of the time. Thus, you can multiply the AB height by 63% and subtract that from the breakout (C) to get a target that price will reach over 90% of the time. Many of you will know this technique as the trendline measure rule. Look for trendline mirrors in finer stores nationwide.

-- Thomas Bulkowski

More

See Also

• Price mirrors. How can they be used for price prediction?
• Gauging Gaps. This article fills in the gaps.
• Support and resistance. Learn the various types.
• Fibonacci retraces and extensions, in price and time.
• Setting price targets using Fibonacci.
• Predicting the breakout direction: With some patterns, it's easy.
• Drawing 3 point channels. What's involved and how is it done?
• Trading cycles help time your entries and exits.
• Trend change detection using a triangle apex.

 

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