160 Sacred Chickens

trendlines. Normally, it takes more than three weeks to complete, and volume will diminish as prices move toward the apex of the
pattern. The anticipated direction of the breakout in a Falling Wedge is up.
Minimum Measuring Formula: A retracement of all the ground lost within the Wedge. (See also Wedge.)
FALSE BREAKOUT
FAN LINES
A breakout which is confirmed but which quickly reverses and eventually leads the stock or commodity to a breakout
in the opposite direction. Indistinguishable from premature breakout or genuine breakout when it occurs.
A set of three secondary trendlines drawn from the same starting high or low, which spread out in a Fan shape. In a
Primary Uptrend, the fan would be along the tops of the Secondary (Intermediate) Reaction. In a Primary Downtrend,
the fan would be along the bottoms of the Secondary (Intermediate) Rally. When the third Fan Line is broken, it
signals the resumption of the Primary Trend.
50-DAY MOVING AVERAGE LINE
Determined by taking the closing (or other) price over the past 50 trading days and dividing by 50. Simple moving average for n
days consists of summing prices for n days and dividing by n. On n+1, drop the first day and add the new day to the formula, etc.
FIVE-POINT REVERSAL
FLAG
See Broadening Pattern.
A Continuation Pattern. A flag is a period of congestion, less than four weeks in duration, which forms after a sharp, near
vertical, change in price. The upper and lower boundary lines of the pattern are parallel, though both may slant up, down or
sideways. In an uptrend, the pattern resembles a Flag flying from a mast, hence the name. Flags are also called Measuring or Half
Mast Patterns because they tend to form at the midpoint of the rally or reaction. Volume