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Murugan Thanikachalam 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
1.Inverted Head and shoulder indicates the Accumulation trend.
2.may take even upto a year to form.
3.reversal of the current trend.
4.high volume prior to formation
5.long position to be considered.
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Murugan Thanikachalam 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
1.Inverted Head and shoulder indicates the Accumulation trend.
2.usually used to predict down trend.
3.reversal of the current trend.
4.high volume prior to formation
5.long position to be considered.
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Murugan Thanikachalam 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
1.Accumulation pattern
2.cup are generally powerful if it takes long time to construct.
3.during the rounding bottom, the volume is expected to be as low as possible.
4.the correlation between the market to the stock should be low during the mid of pattern.
5.buy when cup starts filling
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Murugan Thanikachalam replied to the topic What are Price Patterns? in the forum Price Patterns and its characteristics 8 years, 7 months ago
Price patterns are clear indicators of the price movements, giving early signals to help in reacting to the movement.
1.Double Top/Bottom
2.Upright/Inverted Head and Shoulders
3.Cup/round bottom
4.Bearish/Bullish pole Flags
5.Triangle
are some of the Price Patterns.
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Murugan Thanikachalam 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
1.a steep pole taking only 1 to 3 days to form.
2.rectangular shaped sideways movement can be considered as flag.
3.generally takes 4 to 7 working days to form.
4.+ve pole should give +ve breakout, -ve pole should give -ve breakout.
5.volume expected to increase while breakout happens.
6.flag should not drift lower.
7.both bearish and…[Read more]
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Murugan Thanikachalam 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
1. 5 wave corrective pattern (A-B-C-D-E) should form a triangle shaper structure.
2.the triangle area should be minimum 1.5 months.
3. breakout expected around 70% zone.
4.volume required o confirm breakout.
5.buy/sell depending upon up/down breakouts.
6.most reliable and very powerful pattern.
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Murugan Thanikachalam 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 helps in identifying the trend, not about the quality/nature of the trend; whereas
Price Patterns indicates the characteristics of the price movement and the Entry/Exit points.
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Murugan Thanikachalam 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
Head and Shoulder – sell
inverted Head and Shoulder – buy
Double Top – sell
Double bottom – buy
Cup – buy
Flag …[Read more]
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Murugan Thanikachalam replied to the topic What type of Charts Used, Minimum look up period, Duration of Trend forecasting for Dow Theory? in the forum Dow Theory in Practice 8 years, 7 months ago
Line charts used, with minimum look up period of 2 years. The duration of trend forecasting is 2 to 3 months.
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Murugan Thanikachalam replied to the topic What are Support and Resistance? in the forum Dow Theory in Practice 8 years, 7 months ago
SUPPORT Level is the Price level thro’ which a Stock seldom falls. Usually when a Support Level is reached the Price Trend starts moving in the opposite direction.
In case a Support Level is breached, the Stock Price moves further down till it reaches another Support Level.
RESISTANCE Level is the Price level that a Stock seldom surpasses. Us…[Read more]
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Murugan Thanikachalam 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 is conservative and over time the Economy and the Indexes originally used by Dow, has changed.
Not a valid system for Intra-day.
However, Dow Theory is good for deriving Trends, and the Top and Bottom Theory which is the basis for any analysis.
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Murugan Thanikachalam replied to the topic When to buy and Sell using Dow Theory? in the forum Dow Theory in Practice 8 years, 7 months ago
When DEMAND > SUPPLY – BUY
When SUPPLY > DEMAND – SELL
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Murugan Thanikachalam 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
Open Charts – use Daily Charts, with Minimum 2 years Data.
1. Spot the Top and Bottom.
2. Qualify the spotted Top and Bottom as _ Higher and Lower.
3. Identify the sequence with Volume significance.
Higher Bottom – Higher Top with Volume indicates Bullish Trend.
Lower Top – Lower Bottom with Volume indicates Bearish Trend.
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Murugan Thanikachalam replied to the topic What is Dow Theory? in the forum Dow Theory in Practice 8 years, 7 months ago
Dow Theory was developed by Charles. H. Dow. It is an Old but Golden Concept and the basis of all modern Analysis.
It is good for deriving Trends and to understand Price Movement.
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Murugan Thanikachalam replied to the topic in the forum Murugan Thanikachalam 8 years, 7 months ago
To identify the Demand and Supply, which helps to understand Price Movement and derive Trend.
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Murugan Thanikachalam replied to the topic price movement in the forum Stock market questions and answers 8 years, 7 months ago
The change in price compared to the previous traded price.
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Murugan Thanikachalam replied to the topic what are the Pro and cons of fundamental analysis? in the forum Understanding the Price Movement 8 years, 7 months ago
PROS:
Reliable, powerful and detailed.
CONS:
Expensive, Time consuming, too many parameters, information required is not transparent.
Only a very few companies can be analysed.
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Murugan Thanikachalam replied to the topic What are the pro / cons of technical analysis? in the forum Understanding the Price Movement 8 years, 7 months ago
PROS:
Very few parameters required.
Data is readily available to all, Transparent.
Pattern study is easy and less time consuming.
Any number of companies can be analysed.
CONS:
Not as reliable and accurate as Fundamental analysis.
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Murugan Thanikachalam replied to the topic What drives the stock price? Why to price changes so often? in the forum Understanding the Price Movement 8 years, 7 months ago
Demand/Buyers and Supply/Sellers drive the Stock Market.
Price changes often b’cos, there are different buyers and sellers with different expectations.
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Murugan Thanikachalam replied to the topic What are different types of charts? in the forum Understanding the Price Movement 8 years, 7 months ago
The Three major charts used to analyse price and volume for a specified period are
LINE, BAR and CANDLESTICK charts.
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