the hAnDbook of teChnICAL AnALySISsperandeo and DeMark trendlines
Victor Sperandeo introduced a powerful way of drawing trendlines in his book
Trader Vic: Methods of a Wall Street Master. For more details about his approach,
the reader is advised to read his book. There is no way the author can do jus-
tice here to Sperandeo’s superb approach. In short, Sperandeo trendlines are con-
structed by connecting and projecting a line from a:
■ (^) Lowest trough to the highest minor trough preceding the highest peak for
uptrend lines
■ (^) Highest peak to the lowest minor peak preceding the lowest trough for down-
trend lines
See Figure 5.48.
Thomas DeMark introduced a more responsive approach to drawing trend-
lines in his book The New Science of Technical Analysis. The reader is advised to
read his book for a full treatment of pivot selection process and other prerequisites
necessary for the correct drawing of DeMark trendlines. What is presented here
represents only a brief description of the method. In short, DeMark trendlines are
constructed by connecting and projecting a line from:
■ (^) The two most recent qualified troughs in an uptrend
■ (^) The two most recent qualified peaks in a downtrend
See Figure 5.49. The trendline that is drawn using the two most recent troughs
represents the correct approach to creating DeMark trendlines.
figure 5.47 Channel Projections on the EURUSD Chart.
Source: MetaTrader 4