Gives a better insights on the trend reversals basis break out either on the top zone or bottom zones

  • : stock price changes are indicated by price patterns. Reversal occurs when a price pattern signals a change in trend direction and a continuation pattern occurs when the trend continues in its existing direction
  • : Price patterns indicates the price movement of a share whereas Dow theory indicates the market trend
  • : Two equivalent tops with minimum duration of 20 days with good volume. If the Volume is high and price is moving down the previous bottom, it is the bearish trend and we go for short
  • : Two equivalent bottom with minimum duration of 20 days with good volume. If the Volume should be high after the second bottom. Price goes up above previous top shows bullish trend and we go for long buy.
  • : Head and shoulder is the pattern to determine the price. Right shoulder volume should be low as possible and if position is breaking down the neck line we can determine bearish trend
  • : Usually formed in down trend. Conditions to determine the bullish trend : Left shoulder ->: Price declines and moves higher. Head -> another Decline occurs to a lower level. Right shoulder -> Price then moves higher and moves back lower, but not as low as the head. A trade can be initiated after the pattern is complete and a long position can be created once the right shoulder moves upward breaking the neck line with significant volume.
  • : Rounding bottom or cup bottom takes long time to construct. During rounding bottom volume should be low. Bullish will maintain the volume and accumulation of stocks will be gradual
  • : A steeper pole pattern with rectangular shaped sideways. It takes 4-7 days. Generally sellers will not actively participate and suddenly volume is expected to be more during break out.
  • : ntry must be above the rectangular trend positive side, Exit price must be equally risk, reward and stop loss .Entry price should be just after the breakout Exit price should be just after the price movement has reversed its direction Stop loss should be at the point where the breakout gap is filled.
  • : When both buyers and sellers are aggressive triangle pattern is formed. The triangle area should be mnimum of 1.5 months. Breakout is around 70% zone and volume is required to confirm the breakout.
1 Comment
  1. Maruti Patil 2 years ago


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