This is a thread about Median Lines (ML). Also called Andrews Pitchfork it is an effective tool that can be used effectively in trading. Here I’ll discuss the proper use of median lines and it’s theoretical underpinnings.
Included in most trading platforms the ML tool is usually misused by most as a channel where the lines of the ML are viewed as diagonal support and resistance. Although one will quickly note that the lines often do seem to act as support and resistance this is not the intention of the ML and using them as diagonal support and resistance will quickly lead to frustration.
Price Moves in Swings or Waves
Crucial to using and understanding median lines is the basic fact that price moves in swings or waves. As we’ll see as this thread progresses the median line frames swings in ways that will help the trader see the rhythm of price as it swings.
A core principle of price and probably the most important reason why one would want to use median lines is their ability to project price. We’ll see this in action.
I can go on and on talking but let’s get into some charts.