the hAnDbook of technIcAl AnAlySIS■ (^) Chart Patterns
■ (^) Apex Reactions
Signals are indicated as follows:
■ (^) Oscillator breaching a geometrically based overlay to the upside is a buy (bull-
ish) signal
■ (^) Oscillator testing a geometrically based overlay from below is a sell (bearish)
signal
■ (^) Oscillator breaching a geometrically based overlay to the downside is a sell
(bearish) signal
■ (^) Oscillator testing a geometrically based overlay from above is a buy (bullish)
signal
See Figure 8.12. We see the geometrical overlays, on the momentum oscillator
(MOM), generating buy and sell signals upon violation of trendlines and chart
patterns on the 30‐min chart of the Nikkei 225. We also see a projected channel
bottom buy signal.
fIgure 8.11 Price-Oscillator Divergences on the Daily Chart of the S&P500 Large
Cap Index.
Courtesy of Stockcharts.com