Envelopes and Methods of Price Containment
See Figure 12.8 for buy and sell triggers as well as possible stoploss levels us-
ing the standard breakout approach.
See Figure 12.9 for buy and sell triggers as well as possible stoploss levels on
the weekly chart of the Russell 2000 Growth iShares.
The reversal entry approach requires the trader to initiate a long entry once
price tests the lower band and a short entry if the upper band is tested. With reversal
entries, no price filter is required. The trader may initiate an entry at the exact level
where price tests the upper or lower bands. But if the trader chooses to seek price
confirmation for a reversal entry instead, then the application of a price filter is re-
quired in order to determine the point of entry after testing the bands.Figure 12.8 Buy and Sell Triggers on the Weekly Chart of the Russell 2000 Growth
iShares.Figure 12.9 Buy and Sell Triggers on the Weekly Chart of the Russell 2000 Growth
iShares.
Courtesy of Stockcharts.com