The Importance of a Broken Support Line

by | Dec 3, 2012 | Videos, Technical Analysis

Support Line Broken

Charts are courtesy of Dorsey Wright & Associates.

Understanding what a support line is and also how it is used as a vital tool to manage your money is important. Knowing things like, why it is a pretty big deal when a support line is broken, can help you to better understand the moves that we make in the market here at Mullooly Asset Management. You can find out a lot about support lines in the video.

Mullooly Asset Management uses point and figure charts to manage your money. These charts all contain a support line, which is something that you do not want to see broken. When a support line breaks it is not to be ignored! If a support line breaks that means that particular stock is heading into a negative trend, which is bad news. We avoid negative trends when investing as a general rule of thumb.

In this video you can see several different examples of what a support line looks like on some point and figure charts. It is pretty clear cut when you look at the X’s and O’s why it is a big deal when a support line is broken. Tom will walk you through the charts, and by the end of the video you will have a sound understanding of support lines.

Mullooly Asset Management strongly urges our listeners and readers to talk with their investment adviser before making any decisions to buy or sell any investments. Also none of the securities mentioned in this video or blog post are considered investment advice. If you do not have an investment adviser do not hesitate to contact us at Mullooly Asset Management.

You can download the audio from this video on iTunes for free!

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