@divyaswaminathan
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Swaminathan replied to the topic What are HAMMER / hanging man? Why it is very popular when to buy and Sell? in the forum The Simple Candlestick Analysis 8 years, 7 months ago
Hammer and Hanging man are bullish and bearish trend reversal candle stick patterns.
They are popular because they are strong and reliable patterns.
In case of Hammer, when the price goes above the previous day high then the stock can be bought.
In case of Hanging man, when the price goes below the previous day low, then the stock can be sold.
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Swaminathan replied to the topic What is Engulfing pattern? What are its conditions to qualify? When to buy and Sell? in the forum The Simple Candlestick Analysis 8 years, 7 months ago
Engulfing pattern indicates the trend reversal.
The previous 3 or more days the trend should be bullish or bearish .
On the engulfing day the body of the candle should cover the previous day body .
Previous two days high volumes are expected.
In the next day when the price goes above the previous day close we can buy. The stop loss should be…[Read more]
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Swaminathan replied to the topic What is Candle stick analysis? Its evaluation and it real time application? in the forum The Simple Candlestick Analysis 8 years, 7 months ago
Candle stick analysis is one of the technical analysis tools which indicates trend reversal.
It’s been in use for along time. Initially this was used by Japanese to trade rice.
Candlestick analysis is used by traders who trade stocks for a short duration say a week.
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Swaminathan replied to the topic Who should use candle stick analysis? What is the role of volume in candlestick analysis? in the forum The Simple Candlestick Analysis 8 years, 7 months ago
People involved in weekly trading can use candle sticks. High volume indicates strong trend reversal.
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Swaminathan replied to the topic Price Patterns in the forum Double Bottom / Double Top 8 years, 7 months ago
Price patterns gives the price movement of the stocks over a period of time. It helps us identify the entry or exit price at an early stage.
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Swaminathan replied to the topic What is Double BOTTOM? What are their conditions to determine the bullish trend? in the forum Price Patterns and its characteristics 8 years, 7 months ago
Two equivalent bottoms formed over a month. The volume should be high at the second bottom.
When the price crosses the last high then a long position can be created.
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Swaminathan replied to the topic What is FLAG pattern? What are the conditions to qualify as perfect FLAG? in the forum Price Patterns and its characteristics 8 years, 7 months ago
a steep price movement followed by sideways movement in the shape of flag is called flag pattern.
The steep pole should form in 2 or 3 days.
The whole flag should not take more than 4 to 7 days
Breakout should happen with good volume.
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Swaminathan replied to the topic What is triangle pattern? What are the conditions to qualify as perfect triangle? in the forum Price Patterns and its characteristics 8 years, 7 months ago
Triangle should be formed when connecting the consecutive top and bottom. There should be minimum of five waves in the triangle. The breakout is expected at around 70% of the triangle with good volume. Usually the triangle is formed over 45 days.
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Swaminathan replied to the topic What is rounding bottom / Cup pattern? What are their conditions to determine the bullish trend? in the forum Price Patterns and its characteristics 8 years, 7 months ago
In this stage the price of the stock is range bound or almost stable for a considerable duration of time . The volume will not be high.
When the price breaks the range bound and starts moving up then it will considered as bullish trend.
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Swaminathan replied to the topic How price pattern are different from Dow Theory? in the forum Price Patterns and its characteristics 8 years, 7 months ago
Dow Theory help us understand the demand and supply. This gives us indication of bullish and bearish trends.
Price patterns helps us identify the entry and exit points at an early stage.
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Swaminathan replied to the topic What are Price Patterns? in the forum Price Patterns and its characteristics 8 years, 7 months ago
Price patterns are nothing but the price movement over a span of time. This gives us an indication in which the price are more likely to move.
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Swaminathan replied to the topic What is Double TOP? What are their conditions to determine the bearish trend? in the forum Price Patterns and its characteristics 8 years, 7 months ago
When there are two equivalent tops, then it is called double top. Double tops forms over a span of 20 days. The volume should be high when at the second top . When the process breaks last low then a short position can be created.
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Swaminathan replied to the topic What is inverted Head and Shoulder? What are their conditions to determine the bullish trend? in the forum Price Patterns and its characteristics 8 years, 7 months ago
Inverted Head and Shoulder is wherein you have three bottoms with the middle bottom the lowest. The volume should be high at the right of the pattern. The pattern should have been formed over one month.
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Swaminathan replied to the topic When to buy and Sell using Price Patterns? in the forum Price Patterns and its characteristics 8 years, 7 months ago
Buy in the following cases.
Double bottom
Inverted Head and shoulder
Cup pattern
Flag pattern
Triangle pattern – bullish breakoutSell in the following cases
Double Top
Head & Shoulder
Triangle bearish breakout
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Swaminathan replied to the topic What is Head and Shoulder? What are their conditions to determine the bearish trend? in the forum Price Patterns and its characteristics 8 years, 7 months ago
Head Shoulder is a pattern where you will have three peaks in which the middle is higher than the other two.
The patter should have been formed over a month.
The volume should be high at the left of the formation of the pattern.
We can sell the shares when the prices goes below the right shoulder.
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Swaminathan replied to the topic in the forum Swaminathan 8 years, 7 months ago
DoW theory helps in understanding the demand and supply trend.
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Swaminathan replied to the topic What is Dow Theory? in the forum Dow Theory in Practice 8 years, 7 months ago
DoW came up with a theory to predict the stock price movement and that is called DOW theory. This is one of the oldest theories available for technical analysis.
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Swaminathan replied to the topic How to determine the market trend using Dow Theory? in the forum Dow Theory in Practice 8 years, 7 months ago
Higher Bottom – Higher top combined with high volume is bullish trend
Lower Bottom – Lower Top combined with high volume is bearish trend
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Swaminathan replied to the topic When to buy and Sell using Dow Theory? in the forum Dow Theory in Practice 8 years, 7 months ago
Higher Bottom , Higher top combined with high volume then the stock can be bought when the price moves above the latest higher top.
Lower bottom , Lower top combined with high volume then the stock can be sold when the price moves below the higher bottom.
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Swaminathan replied to the topic What are the major critics against Dow Theory? How come it remains on top of any analysis? in the forum Dow Theory in Practice 8 years, 7 months ago
Dow Theory does not say buy or sell at an early stage. It will wait for the trend to stabilize before suggesting buy or sell . This may result in profit reduction while trading.
DoW theories success is relatively high. The theory has been in practice for a long time and is a proven theory which works even today.
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