One of the variants of pitchforks that we make use of in Median Line Analysis is the Schiff or the Unmodified Schiff. The most commonly used variant is the Modified Schiff and we use the “un” to distinguish it from this one.
An unmodified Schiff moves the A of the fork 50% of the distance in price between the point of origin and the B. I show such a fork, namely the CHFJPY 60 minutes in Chart 1. The horizontal puce lines show the levels of price at the Original A and the B, with the central line being midway or 50% between them. I have drawn the green verticals in order to show this.
You can see how the origin of the fork is moved from the A at the lower puce line to the circled A at the middle one thereby creating an Unmodified Schiff pitchfork. this obviously has the effect of lessening the slope of the pitchfork whilst still making use of the very apparent A, B and C.
The action along the pitchfork is clearly demonstrating that we have identified the correct path of price. Highs and lows of price are in the line of the fork and we are therefore able to monitor the strengthening and weakening of trend as we watch the moves delineated by the lines along the angle of the pitchfork.
Early validation of this fork would have come from the initial resistance at the Upper Quartile and the series of supports along the line of the Lower Quartile. We could watch as price rose towards the circled touch on the Upper Parallel with some expectation that this is where it would encounter resistance.
Following the action of price along the fork we see it fall once more to anticipated support along the Sliding Parallel marked by green circles. To be fair, until this second touch and reaction away from the line we did not know that it was in fact a Sliding Parallel, but it was certainly an area that we would be watching with interest given previous action.
Price moved slightly higher from this second touch finding support once more along the Lower Quartile before rising strongly again to previous resistance along the Upper Parallel. Currently we are watching as the Median Line, along which there is both prior support and resistance, seems to be once again providing resistance. We will follow the moves to see if it can regain this Median Line and turn it into a line of support once more. We will continue to observe the strengthening and weakening of trend along the lines of the pitchfork.
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