Price patterns are identified using a series of lines and/or curves, it is helpful to understand trendlines and know how to draw them. Trendlines help technical analysts spot areas of support and resistance on a price chart. Trendlines are straight lines drawn on a chart by connecting a series of descending peaks (high) or ascending troughs (low).

Dow theory explains the movement of the trend with respect to demand and supply, whereas price patterns explains the nature and characteristics of the trend and also its significance.

*) Two equivalent tops Point A and Points B
*)Min 20 days between two identical tops
*)Point C ,if trend crosses previous low (Point B) and to take short position at C and Stop loss at Point B

*) Two equivalent bottom Point A and Points B
*)Min 20 days between two identical bottoms
*)Point C ,if trend crosses previous high (Point B) and to take short position at C and Stop loss at Point B.

*) One of the important reversal pattern
*)It happens at end of the trend,when price try to continue previous tend but eventually falls.
*)When the price crosses the neckline,reversal is on the way and the movement equals tip of HEAD and neckline of H&S.

*)When H&S forms in downward trend , it is inverted Head and Shoulder.

*)It happens at end of the trend,when price try to continue previous tend but eventually increase.

*)When the price crosses the neckline,reversal is on the way and the movement equals tip of HEAD and neckline of H&S.

Bullish Flag:
*) Should have steep pole
*)Flag should be rectangle in shape
*)Should happen between 4-7 days
*)Volume should be high during breakout

Triangle :
*) Should have 5 wave pattern (ABCDE)
*)Triangle area should be 1.5 months
*)Entry at breakout point (Point exceeding the previous high of point A)
*) Volume should be high

0 Comments

Leave a reply

©2024 | Rights Reserved | EQSIS | Terms and ConditionsPrivacy Policy

CONTACT US

We're not around right now. But you can send us an email and we'll get back to you, asap.

Sending

Log in with your credentials

Forgot your details?