Andrews' Price Failure

Andrews considered a price failure in instances where price does not reach the Median Line.

Andrews described his Price Failure Rule,

“When prices fail to reach the ML as shown by a space
between the P of the reversal and the ML.”

“…the probability is that this price reversal will go further
than it did on its approach toward the ML.”

The Price Failure Rule can be an indication of the weakness of the market as shown above or the strength of the market if price fails to reach a downsloping Median Line.

The rule can also be used as a guide as to how far price will go after failing to reach the Median Line. According to Andrews' explanation, the probability is that price will fall beyond price pivot P2 in the graphic above.

Back to the Median Line

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