USE OF PRICE DISTRIBUTIONS AND PATTERNS TO ANTICIPATE MOVES
Prices often form patterns that can be evaluated using probability methods, or simply viewed in much the same way as a frequency distribution, or histogram. Because the concepts are sound, but the statistical analysis is often difficult because of limited amounts of data or changing conditions, analysts have taken a much more empirical approach toward studying price distributions. The following section will look at some innovative ways to look at price distributions and how they are interpreted into trading opportunities.