Woodies CCI Trend Line Break (TLB) Pattern:

A Trend Line Break pattern uses two or more decent sized bumps, using CCI or TCCI, to lay the trend line across them. Then when the CCI crosses or breaks that trend line (tl) that is the signal to enter the trade. One end of the trend line should be at CCI value +/-100 region or greater for it to be valid. Also, the more bumps you lay it across the more valid that trend line is. Using only two bumps is normal and creates a perfectly valid TLB. You can also mix the use of CCI and TCCI bumps for each trend line. This pattern is also used as one of the exit signals and as a CCI confirmation signal too. It comes in quite handy and is widely used in Woodies CCI system.

The TLB trade can be both a trend and a counter-trend trade. New students of Woodies CCI should be taking this type of trade if it is a TLB with the trend. Do not take this trade against the trend. However, keep your eye on it and learn as you progress.

You can combine the zero-line reject (ZLR) pattern and the reverse divergence (rev diver) pattern along with a TLB pattern to add strength to the signal for a greater probability of success. When combining these together you would still enter on the break of the trend line, as it will occur last.

Another method of entry on a TLB trade is to use the CCI confirmation signal cross of the +/- 100 value. This provides a greater chance that the trade will be successful. You do not have to use this method and you may get more profit on the TLB trade if you get in well before this point. However, if you do not add the CCI confirmation of a +/- 100 cross then your TLB trade might not work out so often. Pick a method and stick with it. Don’t change daily.

You will very often find the TLB and ZLR show up together. Sometimes the rev diver pattern will show up with them as well. You should start to notice that CCI patterns all come one after another and also form together to make stronger signals. Do not let this confuse you. You only need one CCI pattern to take a trade. However if you combine more than one signal it adds to the probability of success for that trade.



Chart 1 Chart 2 Chart 3

3 Charts Above – Trend Line Break Patterns.

The yellow lines show the CCI pattern. The single white lines show the entry for this type of trade and the double white lines are the exit signals.

Note that all 3 charts show the Trend Line Break pattern with the trend. No TLB counter-trends are shown. In the 1st chart we can see how the TCCI was used to draw the Trend Line Break trade. This is valid and works well.

Notice in the 2nd chart that there are two exit signals. One is where the TCCI crossed into the CCI. The second exit is when the CCI hooks.

The entry method of waiting for the CCI cross of the +/-100 is shown in the 2nd chart but just happens to be there by coincidence.

The exit signals are the same as in any other trade. Go review the section on how to enter and exit trades.

It is very important to remember that when you take one of these trades it does not mean you are supposed to stay in it forever. Always follow Woodies CCI exit signals.