Joe Ross
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This question was sent to me from one of our students: “Hey Joe! Do you know how to create a lateral resistance zone?”
Boy! Do I ever!! That term comes from something my friend Kent Calhoun teaches. A Calhoun Lateral Resistance Zone is created between horizontal parallel lines drawn across the highest high and highest close. These prices create a sell zone, particularly when prices hit a Trend Channel Resistance Line and a Lateral Resistance Line at the same time. When a diagonal Trend Channel Line intersects a Lateral Resistance Line a turning point is created where the market should change trend, or accelerate sharply to the upside. When prices trade above a Lateral Resistance High and closes twice above that price, the Lateral Resistance Zone becomes the Lateral Support Zone. The technical rule is this, old resistance becomes new support, and when old support is broken new resistance is created. When a longer term bottom is due and a Lateral Support Zone Low is broken on an intra-price bar, a pivot buy can be made 3 ticks above the previous low on a buy stop with a protective stop loss 3 ticks below the intra-price bar low of entry. This pivot buy is a high risk entry.
Got it? Good! Now, please report back in your own words exactly what all this means! Include pictures because I don’t read too well.
Boy! Do I ever!! That term comes from something my friend Kent Calhoun teaches. A Calhoun Lateral Resistance Zone is created between horizontal parallel lines drawn across the highest high and highest close. These prices create a sell zone, particularly when prices hit a Trend Channel Resistance Line and a Lateral Resistance Line at the same time. When a diagonal Trend Channel Line intersects a Lateral Resistance Line a turning point is created where the market should change trend, or accelerate sharply to the upside. When prices trade above a Lateral Resistance High and closes twice above that price, the Lateral Resistance Zone becomes the Lateral Support Zone. The technical rule is this, old resistance becomes new support, and when old support is broken new resistance is created. When a longer term bottom is due and a Lateral Support Zone Low is broken on an intra-price bar, a pivot buy can be made 3 ticks above the previous low on a buy stop with a protective stop loss 3 ticks below the intra-price bar low of entry. This pivot buy is a high risk entry.
Got it? Good! Now, please report back in your own words exactly what all this means! Include pictures because I don’t read too well.
