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Darshan Sanwal 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 7 years, 10 months ago
Hammer’s Lower tail must be at-least 2 times the size of the body.
Hammer should be green in colour
the upper tail must be invisible of very small
Volume traded during the day must be high.
Hammer indicates reversal in trend. Buy when the price is above the day’s High of the hammer.
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Darshan Sanwal 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 7 years, 10 months ago
Engulfing pattern occurs when there is a trend in price (I.e either price rise or fall). The current day body should cover the previous day body in the opposite direction (i.e from bear to bull and vice versa). There should be slight Increase in volume. Time to buy:
1. Bear to Bull : Previous day high price.
2. Bull to bear : create a short…[Read more]
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Darshan Sanwal replied to the topic What is morning and evening STAR? When to buy and Sell? in the forum The Simple Candlestick Analysis 7 years, 10 months ago
When a doji occurs because of change in trend from the existing situation it is said to have formed a star. When it happens forms after fall in prices it is said to be morning Star and when it happens after an upward movement from market it is said to be evening star.
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Darshan Sanwal replied to the topic What is Candle stick analysis? Its evaluation and it real time application? in the forum The Simple Candlestick Analysis 7 years, 10 months ago
A candle stick shows the start, day’s High, Day’s Low and the end point. The open and close prices are joined in a rectangular way. When the rectangle is left white or green it means that the prices have gone up. On the contrary when the rectangle is red in colour it means the prices have fallen during the week.
It is applied by weekly traders
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Darshan Sanwal replied to the topic What is the general forecasting duration using candlestick analysis? in the forum The Simple Candlestick Analysis 7 years, 10 months ago
The candle stick analysis helps the traders to analyse weekly price movements.
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Darshan Sanwal 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 7 years, 10 months ago
Any trader with a time horizon of 1 week should use candle stick analysis. Volume indicates the trend of the stock and hence it shows if there is any reversal from existing trend
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Darshan Sanwal replied to the topic What is piercing pattern? What are its conditions to qualify? When to buy and Sell? in the forum The Simple Candlestick Analysis 7 years, 10 months ago
Bullish piercing pattern:
1. There should be a recent fall in prices.
2. The day’s Open must be lower than the previous day’s Low.
3.The day’s Body should cover at-least 50% of pervious day body.
4. the upper tail of the candle should be either nil of very less.
Buy Price will be after previous day’s high
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Darshan Sanwal 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 7 years, 10 months ago
when the price pattern of the company forms a cup i.e the price moves as per itself and not as per market (Low correlation between stock price and market).
A company usually keeps collecting the stock at regular interval. over a period of time the demand of the stock is more than the supply creating a sudden increase in price. The collection of…[Read more]
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Darshan Sanwal replied to the topic When to buy and Sell using Price Patterns? in the forum Price Patterns and its characteristics 7 years, 10 months ago
With price patterns we can determine the demand and supply of the stock price.
If we identify that the demand> supply we should purchase (create long position).
On the contrary if supply is more than demand we should sell (Create short position).
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Darshan Sanwal 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 7 years, 10 months ago
A wave formation showing both the buyers and sellers entering the common area . if we draw a line with the tops and bottoms we would get a triangle. The time period required to form this triangle is 4 to 6 weeks. At breakout there should be high volume traded.
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Darshan Sanwal replied to the topic What are Price Patterns? in the forum Price Patterns and its characteristics 7 years, 10 months ago
Patterns formed by price movement which helps in understanding the price movement
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Darshan Sanwal replied to the topic How price pattern are different from Dow Theory? in the forum Price Patterns and its characteristics 7 years, 10 months ago
Dow theory helps us to understand the forces of demand and supply over a long period. It gives us an indication what should be our risk and at what point should we exit. Where as price pattern studies data for past few days and tells us when to invest and when to exit with required return and risk with the time horizon of maximum 1 month.
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Darshan Sanwal 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 7 years, 10 months ago
The Inverted head and shoulder pattern indicates accumulation scenario. The price should be at a low point at the head stage. The volume during the left shoulder stage is generally very high. The volume during the right shoulder is low. Long position is to be created when the price moves above the neck line. The duration to form the head and…[Read more]
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Darshan Sanwal 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 7 years, 10 months ago
There should be 3 points where by the stock prices movements should be like a head and shoulder. In the left shoulder I.e the initial Period of price rise the volume should be high..
during the right shoulder the volume traded should be low. The duration to form the head and shoulder should be 1 month each. hence the total head and shoulder…[Read more]
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Darshan Sanwal 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 7 years, 10 months ago
There should be two equivalent bottoms. Volume should be high either at the bottom or when the price has reached to previous top after reaching the bottom for the second time.
Duration between the two bottoms should be at least 20 days.
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Darshan Sanwal 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 7 years, 10 months ago
There should be 2 equivalent tops. The duration between the tops should be more than 20 days.
Conditions: short position is to be created when the price falls below the previous bottom.
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Darshan Sanwal 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 7 years, 10 months ago
A flag pattern occurs after a steep increase in price of the share of the company. At breakout the share price starts moving horizontal. Once the share price exceeds breakout range with high volume withing one week constitutes perfect flag
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Darshan Sanwal replied to the topic How to determine the market trend using Dow Theory? in the forum Dow Theory in Practice 7 years, 10 months ago
Identify Tops and bottoms in Line chart of the company. Once identified then classify them into Higher tops/Lower top and higher bottom/Lower bottom with respect to previous tops/bottoms.
Once identified when the price moves upward from the previous top with high volume it means the demand is more than supply and hence that is the minimum price…[Read more]
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Darshan Sanwal replied to the topic What are Support and Resistance? in the forum Dow Theory in Practice 7 years, 10 months ago
Support i.e demand is more than the supply. It is that zone where buyers are bullish about purchasing the stock and hence create more demand than the supply available in market.
Resistance i.e Supply is more than demand. It is that Zone where Sellers want to sell the stock at the price level however the demand can’t meet the supply.
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Darshan Sanwal 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 7 years, 10 months ago
Dow theory requires a lot of data and lot of time to study the price movements. Also DOW theory does not give the strength of the bull or bear movement.
It remains as one of the top because it helps in understanding the demand and supply and many of the theories revolve around DOW’s Theory.
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