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Chapter 10. How I use “TMVTT” > Additional rules for maximum success

Additional rules for maximum success

The following sections describe additional and important rules to help you maximize your successes.

The accelerated trend

These methodology examples illustrate how moving averages assist you in determining the trend of a market and, as a result, can help you make money. However, because moving averages are a lagging indicator, they are not designed to pick tops or bottoms, and, by their nature, they leave money on the table. In fact, when a market is in what I term “the accelerated trend,”' at times my methodology can leave quite a bit on the table, so let's discuss one technique designed to minimize this problem. First of all, it's important to define what an accelerated trend actually is. In an up-trend, it looks like a parabola. The accelerated trend generally occurs at major tops and, at times, at blow-off bottoms. It's what W.D. Gann called “the third zone above normal.” Here's how Gann (more than 50 years ago) described this type of market action:


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