Trading Setup Tutorials : "Yum-Yum Continuation Pattern "

Yum-Yum Continuation Pattern

Yum-Yum continuation pattern is a delicious trading setup found in the Ultimate Trading Guide by John R.Hill, George Pruitt, and Lundy Hill. If we’re a book analyst, we would issue a “strong buy” for this book for its variety of sound price-based trading ideas.

Take a look at Yum-Yum and if you find it yummy, you might want to take a look at the book.

TRADING RULES – YUM-YUM CONTINUATION PATTERN

LONG TRADING SETUP

1.  Existing upwards trend

2.  Swing high broken with a wide-range bar that exceeds the 10-period average range

3.  Close is near the high of the bar and above the open

4.   Buy on breakout of wide range bar (within 1 to 3 bars)

SHORT TRADING SETUP

1.   Existing downwards trend

2.   Swing low broken with a wide-range bar that exceeds the 10-period average range

3.   Close is near the low of the bar and below the open

4.   Sell on breakout of wide range bar (within 1 to 3 bars)

Trading Setup Tutorials : "Trend Lines For Trading Pullbacks"

Trend Lines For Trading Pullbacks

Trend lines are amazing trading tools. Even traders who swear off indicators draw trend lines. Seasoned traders can see how price action interact with trend lines without drawing them. If you want to join their ranks, John Hill’s Trend Line Theory is an excellent place to start.

John Hill is a co-author of Ultimate Trading Guide, an excellent trading book. The Yum-Yum Continuation Pattern is also found in this book. John Hill has another lesser known book called Scientific Interpretation of Bar Charts. It is a concise manual with a chapter devoted to trading with trend lines – Trend Line Theory.

In the Trend Line Theory chapter, John Hill introduced a variety of trend line breakout setups. The basic idea is to find if each breakout is valid by considering :

• Trend
• Number of pullback swings
• Relative swing length
• Swing retracement percentage

TREND LINES AND PULLBACKS

In general, the weaker the pullback, the more likely for a trend to resume. This means that a weak pullback is worth risking our precious trading capital. On the other hand, a strong pullback is a clue that the market might reverse soon. Pullback traders should hold their reins.

With two simple trend lines, you can observe the strength of complex pullbacks. (What is complex? At least a three-legged pullback).