Three-Line Break


Function Name: ThreeLineBreak

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Category: Other

The three-line break chart looks like a series of white and black blocks of varying heights. A new block is in a separate column. Each of these blocks is called a line. Using the closing price, a new white line is added if the previous high is exceeded and a new black line is drawn if the market reaches a new low for the move. If there is neither a new high nor a low, nothing is drawn.

If a rally (sell-off) is powerful enough to form three consecutive white lines (three black lines), then the low of the last three white lines (the high of the last tree black lines) has to be exceeded before the opposite color line is drawn. The term "three-line break" comes from the fact that the market has to "break" above (or below) the prior three lines before a new opposite color line is drawn.

A major advantage of the three-line break chart is that there is no arbitrary fixed reversal amount. It is the market's action that will give the indication of a reversal.


Source: "Steve Nison - Beyond Candlesticks: New Japanese Charting Techniques Revealed"





Default Value: -1


Type: Boolean