Basic Techniques  |  MAY 2000

Speed Resistance Lines by Jayanthi Gopalakrishnan

Speed Resistance Lines by Jayanthi Gopalakrishnan Need to determine support and resistance? Try this. It is not unusual to come across situations in which you see a market trending and think it may be too late to get in. To check, you wait for a pullback to determine if that might be a good entry point. But is this pullback a correction or a trend reversal? Determining whether a trend is going to continue or reverse is critical to a trader. Speed resistance lines, which were developed by technician Edson Gould, can help determine whether the market is correcting itself or a trend will reverse.These lines measure the speed of a trend by measuring the rate of ascent or descent. They are similar to Fibonacci fan lines, and you may have heard them also being referred to as one-third or two-thirds lines. Speed resistance lines are a hybrid of simple trendlines and Fibonacci retracement levels, and they are helpful in creating support and resistance levels.

by Jayanthi Gopalakrishnan