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Showing posts with label Triangle. Show all posts
Showing posts with label Triangle. Show all posts

Monday, March 5, 2012

Tata Steel: Waiting for a fall


It was a shear “jack-pot” I never thought Tata Steel will be able to cross the gap. I never thought it will be able to cross 400 levels..  
Gaps are still playing there game


  
What’s next?



Saturday, March 3, 2012

Trading Triangles-Introduction


Triangles are some geometrical figures which are formed on charts. Unlike triangles having 3 point of contact, triangles in technical charts are formed when supports/resistance and tend line to meet at a single point.

Each triangle in charts comes with different shapes. Always triangles are classified under continuation pattern. The world “continuation” say that the trend is going to be same (uptrend or sideway or downtrend) and continue to follow the previous trend.
(Technical Analysis of Financial Markets by Jhon. J. Murphy, page no.129)


But, according to Edward and Magee in there book “Technical Analysis of Stock Trends 9th Edition”... they classify triangles under Reversal (Page99).


Why are triangles formed?
Its pure psychology that, a price of a stock always moves in a trend. And a trend has two different terms those are support and resistance. Some times the supports and resistance show some unusual variations forming a triangle.

 In every triangle there is one constant either it is support/resistance and the price form uptrend/downtrend forming a triangle, opposite to the constant line. (Except in symmetrical triangle).

What are the parts of triangle?
There are many types of triangles. But, there are few things common in them.. Those are as follows:


  • Support & Resistance (SAR): Every triangle has a support and resistance. The reason for these SAR helps you in many ways. Sometimes when a triangle fail to make itself a triangle. SAR plays a very important role, by showing the path of the triangles.


  • Uptrend/Downtrend line: It is one of the most important parts of a triangle because it shows the behaviour of a price action. This uptrend line also play a very important role in measuring the future price action of a stock.


  • Breakout Up/Down: when an uptrend line choreograph price action to break its support/resistance. The real sentiments of market play a real role and that’s the reason why we always see for a breakout. A breakout is always seen as a conformation of an uptrend/downtrend.


  • Throwback/Pullback: These are only seen when there are poor bullish/bearish sentiments in market. It is also an indication of a fail-break.

  • Gap: A gap is a gap in price movement of a stock. We normally see gaps during breakouts (some times even in Fail-breaks). There are various types of Gaps and the gap that we see during a breakout is a breakaway gaps.

  • Cardle: most of people never consider cardle an important tool. A cardle is a place where the S/R and uptrend/downtrend line meet. It is a point of collision of two lines. But according to few, a cardle is going to help us determine it as triangle or wedge. It is also called apex/ point of interaction.

Types of Triangle

There are 3 types of triangle namely..
·          Ascending triangle
·         Descending triangle
·         Symmetrical triangle

Art of placing Targets, Stop-loss and Entry in Triangles
Ascending Triangle
Descending Triangle



To be  continued ....


Thursday, December 22, 2011

Tata Motors: Waiting for breakout




90% I am bullish, 10% I am not.

We have seen a bullish crossover in MACD, where we have seen 2 main possibilities for buying. I can blindly buy, but I am waiting for “c”. If we see a positive breakout then it is a potential buy. I have not willing to take a risk as it is my 1st time playing with “Symmetric Triangle”

We have seen a potential crossover
MACD: we have seen a positive crossover
MACD: zero line/centre line crossovers

Monday, December 19, 2011

Tata Motors: looking good

A symmetrical triangle.

I hope I have got it right this time.

Yes, I have clarified. It's a Symmetrical Triangle.

Sunday, December 18, 2011

Rel Com Ltd: Did you see that?

I was in a confusion, calling it a Symmetric Triangle or Descending Triangle. After a short conversation a Technical Analyst told me that it's a Descending Triangle.