Trendlines, prior price extremes and hidden Fibonacci levels all swing market momentum back and forth. This price series bases off the common decimal system of 10 and tenths. And you need look no further than your fingers and toes to understand their logic.
Markets consistently shape patterns involving whole number logic.
Traders can create successful entry strategies that capitalize on these dependable characteristics. The character of the prior trend slowly evolves into a period of quiet position squaring, frequent testing and small retracements. This area of consolidation represents an important activity zone for the swing trader. Fade strength and buy weakness until broader conditions tell a different story. Measure the reduction in price volatility to locate the climax for this redistribution process.