David Drozd

Prices over a period of time are typically confined to a trading range. Prices are content to move up and down within this range until there is a shift in equilibrium, at which time the trend will turn decisively in the direction of the breakout from the range. Trendlines During the course of a trend […] Read more

Although technical analysts, such as myself, rely primarily on our analysis of the charts for determining price reversals and in forecasting price direction, we do keep one eye open to the fundamental information as well. I’ll have to admit, though, that whenever technical and fundamental analysis are at odds, and they are more times than […] Read more

When one studies many weekly bar charts, it becomes evident that prices over a period of several months are typically moving up or down. This direction is the long term or major trend of the market. Within the major trend are a series of fluctuating price movements that can be of several weeks’ duration. The […] Read more

As I have mentioned before in this column, the Japanese are true pioneers of technical analysis of the markets. Their techniques have evolved from fairly simple beginnings, trading forward rice contracts (futures) in the 17th century, to now include many sophisticated ways to analyze the markets, including the amazingly powerful modern-day charting method called the […] Read more

V bottoms take two forms: the more classic or true V, and the extended V. In the former formation, three essential components must be present: Prices must be in a downtrend and a futures contract is more apt to be in a free fall, or near vertical decline. A pivot point is reached which will […] Read more

Rectangles, or box formations as they are sometimes called, are frequently found on futures price charts. Sometimes they prove to be a continuation or sideways consolidation pattern following an obvious trend, indicating that the market is simply taking a breather before continuing its advance or decline. At other times box or rectangle formations can evolve […] Read more

The Japanese are regarded as the true pioneers of market technical analysis. They began trading forward rice contracts (futures) in 1654 and over the next three centuries have developed many sophisticated ways to analyze the markets. One Japanese method of charting is called candlestick because the individual lines resemble candles. While candlestick charts use the […] Read more

Resistance is a term used to describe a price level where the selling of futures contracts is expected to halt the current upward move in price of the market. On the daily charts, these areas will appear as well-defined price ranges within which the market previously traded essentially sideways (A), prior to making a decisive […] Read more

Since establishing a yearly low of $4.55 per bushel on Dec. 5, 2008, wheat prices have rallied to $6.16 per bushel, racking up an impressive increase, at the time of writing, of 35 per cent in just 15 business days. Two chart formations materialized: a bear trap and a breakaway gap, early indicators of a […] Read more

Recent volatile price action is similar to that seen in the early 1970s, when markets realigned into a new higher trading range. Examining these patterns more than three decades old can reveal clues about future price direction, as history often repeats itself because human nature never changes. If history should repeat, similar to trading patterns […] Read more