It’s Crayon time.

One of the simplest trading setups to visualize is a Trend Line test. In the following example for SHW (Sherman-Williams) you can see how price drifts down on Monday June 6 to touch the Trend Line, but holds above it:

Today however, price has bounced and is forming a Doji candle. Often I will put a comment in my charts to “Play the bounce or failure”. What I am referring to is to decide if you think that price bounces at the Trend Line (you go Long), or fails to hold and falls through (you short the Trend Line break).