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Vijayakumar 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 8 years, 6 months ago
- Green body covering the lower tail of previous red & more than 50% of previous body.
- Upper tail should be minimal
- Buy above high of green body
- Stoploss – Low of green body
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Vijayakumar 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, 6 months ago
- Hammer is Candle with small body, long lower tail & negligible upper tail (long upper & small lower in case of hanging man)
- Should be green in color
- Volume should be high
- Previous fall required
- Buy above high of hammer on the next day
- Stoploss – low of hammer
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Vijayakumar replied to the topic What is morning and evening STAR? When to buy and Sell? in the forum The Simple Candlestick Analysis 8 years, 6 months ago
Morning star:
- DOJI after a down trend
- Buy on breaking the high of the DOJI on the next day
- Stop loss – Low of DOJI
- Target – 1.5-2 times of the stoploss value
Evening star:
- DOJI after a rally
- Short on breaking the low of DOJI day
- Stop loss – High of DOJI
- Target – 1.5 – 2 times of the risk.
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Vijayakumar replied to the topic What is DOJI? How to make use of DOJI? in the forum The Simple Candlestick Analysis 8 years, 6 months ago
- DOJI is a neutral candle. Open & close price are almost same
- is a trend reversal pattern
- On DOJI with high volume & next day breakout on the other side of the trend – Positions can be created on breaking the high (In case of morning star) of the DOJI
- Can expect 1.5 – 2 times returns of the stoploss
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Vijayakumar 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, 6 months ago
Bullish Engulf:
- Previous down trend
- Previous red body is completely covered by current green body.
- Go long above the high of green body
- Stoploss: low of green body & Target : same height as stoploss
Bearish Engulf:
- Previous up trend
- Previous green body is fully covered by current red body
- Short below the low of red body
- Stoploss: high…
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Vijayakumar 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, 6 months ago
- Weekly traders
- Volume should be high for DOJI & Hammer; Not significant in case of engulfing.
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Vijayakumar 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, 6 months ago
- A technical tool which considers price movements within a day as well for the analysis
- Works well with short period (3-4 days to weekly)
- Provides clear buy & selling points
- Easy to analyse
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Vijayakumar replied to the topic What is the general forecasting duration using candlestick analysis? in the forum The Simple Candlestick Analysis 8 years, 6 months ago
Daily Candle sticks: 3-4 days to a week
Weekly: Around a month
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Vijayakumar 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, 6 months ago
- Bullish reversal trend
- two equivalent bottoms with 20 days gap ( points A & B)
- Breakout on higher side after point B (point C)
- High volume on point B or C
- Go long on confirmation of point C
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Vijayakumar 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, 6 months ago
- Five point corrective pattern
- Should form over a period of 6 weeks
- Breakout with high volume at 70% of the triangle
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Vijayakumar replied to the topic What are Price Patterns? in the forum Price Patterns and its characteristics 8 years, 6 months ago
- Concept built on the DOW theory
- Overcomes demerits of DOW theory
- Direction as well as strength of the trend can be identified
- Graphical representation of the price movement is used to identify the patterns formed.
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Vijayakumar replied to the topic When to buy and Sell using Price Patterns? in the forum Price Patterns and its characteristics 8 years, 6 months ago
Buy on a bullish pattern breakout & sell on a bearish pattern breakout.
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Vijayakumar 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, 6 months ago
A strong pattern that can signal the bullish behavior of the trend at very early state.
- A steeper pole
- followed by rectangular movement for a short period
- High volume on breakout on the upper side.
- Flag should not drift from the rectangle.
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Vijayakumar 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, 6 months ago
Bearish trend reversal pattern. Previous rally can confirm the trend reversal.
- two tops with a higher top in between (Gap between each top is around 1 month)
- Volume is high on the left shoulder
- Volume is lesser on the head & right shoulder (right neck should be as low as possible)
- breaking the neck line on downside can confirm the down trend.
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Vijayakumar 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, 6 months ago
- An accumulation pattern
- Forms over a very long period ( longer the stronger)
- Volume at the bottom is lesser
- does not correlate with the market movement.
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Vijayakumar 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, 6 months ago
It is an accumulating pattern. Prior downfall can confirm the trend reversal.
- 2 bottoms at a 3 month period with a lower bottom in between.
- Volume is high on left shoulder
- Volume comparatively lesser on the head & right shoulder
- Long position can be created on breaking the neck line on the upper side.
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Vijayakumar replied to the topic How price pattern are different from Dow Theory? in the forum Price Patterns and its characteristics 8 years, 6 months ago
DOW theory – Trend can be identified; But strength of the trend is unknown.
Price pattern – Quality of the trend can be determined; Signals will be comparatively earlier than DOW.
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Vijayakumar 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, 6 months ago
Its a bearish reversal pattern.
Conditions:
- Two equivalent tops (point A & B) with some 20 days in between
- Bottom level between point A & B is broken after B (Point C).
- Volume is high either at B or C.
Confirmation of bearish trend is at point C.
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Balaji and Vijayakumar are now friends 8 years, 6 months ago
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Vijayakumar 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, 6 months ago
Critics:
- Provides late signal thus leading to minimal profits
- Will not be helpful in determining the duration of the current trend
Still the best method for deriving the trends & base for many other type of technical analysis.
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