[Haugaard]

Thanks for Malaguti for replying.

Your comment raises another good point...does historical support and resistence hold much weight. I guess there is two points here: psychological (round numbers, historical pivot points etc) and support/resistence that are truly based on holders at those price points that hold on until they break even. Would buyers of the stock up at 5 hold on for that amount of years before breaking even when it gets back to 5 again. A question I guess is does very old historical tops/bottoms (and I mean over 5 years) have much weight as the buyers/sellers at this price points would have, over time, relenquished their stock. However, if you look at Silvers rise to $50 back at the start of the last decade, it hit the same price that silver hit back in the early 80's (so here $50 is a psycogological price on the chart).

Just to go back on my original question, I guess what Im trying to say is that...in trending markets (up or down) stock prices play out in the form of patterns. Is it when the markets are playing ball, these patterns play out, and they only change course when the markets wobble and everything gets thrown out, so the market loses its posture and partterns begin to break down.

I'm not positive that i completely understand your question, but i'll do my best to try and answer it.

The older the resistance, the less meaning it holds. Stan generally said, that one shouldn't pay attention to resistance that are two years or older. Other factors can come in to play as well. The more times a resistance is being tested, the more likely it is to fail. Furthermore, the amount of volume in stage 1 also impacts the resistance above, since high volume in stage 1 indicates a transfer of shares to willing buyers and therefore turning the sentiment form bearish to bullish.