JMC Finance Institute | Core Principles of Technical Analysis

Module 1 — Key Principles

Then your seven principles:

1. Systematic Market Structure
2. Historical Pivot Points
3. Double Tops & Double Bottoms
4. Triple Tops & Triple Bottoms
5. Horizontal Support & Resistance
6. Diagonal Trend Lines & Dynamic Channels
7. Anchor Points for Trend Line Construction

Test Your Understanding

Answer the following questions comprehension:

1. Trend Identification: Why is entering trades in the direction of the dominant trend considered statistically more advantageous than counter-trend trading?
2. Support & Resistance Dynamics: How do previous swing tops transform into future support levels once a breakout occurs?
3. Pattern Confirmation: What key filter or volume signal should a trader wait for to confirm a double top before opening a short position?
4. Structural Failure: Why do triple tops and triple bottoms often produce stronger and faster price expansions than double tops or bottoms?
5. Chart Mechanics: What is the technical difference between drawing support/resistance using horizontal lines versus diagonal trend lines?