Alan Andrews Pitchfork
This trading method based on the use of three parallel trend lines constructed on the price chart. Since the lines are graphically similar to the pitchfork, this agricultural tool and formed the basis for the name of this trading method. channel levels of support and resistance lines formed by the upper and lower levels. Critical peak or trough is selected in the left point at the first line of this trend. It is performed in exactly between the two extremes on the right and called handle (Pitchfork).
Next, the second and the third trend lines running parallel to the first trend line. They come out of the two extreme points on the right, is an important peak or trough. These lines represent the "teeth" pitchfork.
Application pitchfork and signal lines
Rules for buying
Indicator of the strength of the market and a buy signal can be considered a situation where the price begins to break above the descending upper line parallel.
Indicator of market weakness and a sell signal can be considered a situation where the price falls below the bottom line upward parallel.
A buy signal on the forks going down, and the top level of the signal line is a situation where the price is not reaching the midline, begins to grow, and breaks above the upper level of the signal line.
Terms of sale
A sell signal on the forks going up and the lower boundary of the signal line is a situation where the price can not rise to the midline, and then falls below the lower limit of the signal line.
After constructing the upper and lower parallel lines, parallel lines are built below pitchfork, and they are called warning.
Because there are times when the forks look very steep, not having little or no meaning to the trade, in this case, use 50% Andrews pitchfork. New forks, built on the same reference points (we remember that three of them) as the standard, but in this case, apply the new rules.
For intelligent application of Pitchfork, trading forex trader must choose the graph extreme minimum or maximum. This will help him determine the very "pivot point" and then draw a trend line, called the median line. Next, the trader divides into two parts line drawn during the next stage of the correction on the chart, which is formed after the pivot point. Line running parallel to the median line is passed through the minimum and maximum point correction stage, respectively, forming a graphical model that resembles a pitchfork.
Relationship currency pairs
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