Pattern Trading

Linus · #**151** 4th February 2007, 10:11 AM

Hi Ashish,

Thanks for your input. BTW, I was never in Gurgaon! Always been in this big country called Mumbai!

Regards,

ss.

ps.. I too have a blog but I don't know whether Traderji will allow me to give my url here.

krishna murthy · #**152** 4th February 2007, 10:38 AM

dear ashish
your pattern display is fantastic, kindly forecast for rajesh export sonata software and trigyn.
thankyou
krishna murthy.

aca_trader · #**153** 4th February 2007, 11:04 AM

Quote:

Originally Posted by toxicexpulsion

Can you please post views on century textiles and titan industries

Century Textiles has broken a short-term Trend-Line, Has made lower pivotal highs and has taken support around 680-685 zone. As of now, the stock is in a downtrend mode on daily charts. However, on weekly charts, it's a no-signal zone and a Long-Term Trendline is yet unbroken.

The aggressive traders can short the stock if it brakes down the resistence zone while conservative traders can wait for the long-term trenline to be violated for shorting the stock. In any case, long should be avoided in this counter as of now.

Titan has made new highs and has broken out of a rising price channel. One should wait for a pullback in this stock to enter from long side.

Best Regards,
--Ashish
http://tradingtalks.blogspot.com

aca_trader · #**154** 4th February 2007, 11:32 AM

Quote:

Originally Posted by bvpraveen

Hello Ashish,

With reference to your various posts on H&S, I need some clarifications on being termed them as H&S:

1. Prior trend: As far as I know, a prior trend should exist for any reversal or continuation patterns. In some of your charts on H&S, I couldn't see any prior trend at all. They are just in trading range(sideways).
Eg:BomDyeing_H&S

Hi Praveen!

I do agree with you that a prior trend should exist for the stock to reverse or consolidate. IMHO, Bombay Dyeing is in a downtrend now, making lower highs and lows. That is the reason why H&S Consolidation pattern was accepted by me as valid. I am attaching the charts.

Quote:

2. Volume confirmation: Although topping patterns doesn't need huge volume confirmation compared to those at market bottoms, isn't it we need at least a good volume confimation. What are the parameters you consider for the breakout/breakdown above/below the neckline, so that the pattern is confirmed?
For eg: ABAN_H&S.

"It needs volume to push up the stocks but they can fall of their own weight"- An old wall-street adage. Hence, in H&S breakdown, there is no requirement of volume being heavier.

The volume requirements of H&S TOP are as follows:
A.. Heavy volume on Left Shoulder formation.
B. Decline in activity and again upward movement of price to firm Head but the volume this time would be lower than the volume on left shoulder.
C. Another rally to form Right Shoulder but with very low volume.

If all these volume behaviours are satisfied, the H&S should be accepted as a valid Reversal Pattern. However, if the price is making a H&S formation but volume is not confirming to these rules, the formation will act like a consolidation. In such consolidation, usually the volume would follow an overall downward trend.

Quote:

3. Time frame: Isn't time frame should be given some importance. After all if we get into in-depth details about the rationale behind H&S formations, like supply/demand, high volume on close below neckline, etc. they need some time to form such a pattern. What I feel is, some of the patterns identified as H&S are of very small time frame, which I wonder whether it can be taken as valid H&S formation?
Eg. CarolInfo_H&S

I do agree with you that a H&S can not be made within a few days. However, most of the complex H&S which form over a very long period tend to perform badly.
Carolinfo made the H&S pattern in more than 40 days which should be taken as a sufficient time-period to form a pattern like H&S.

Quote:

P.S: I'm just posting to get your views or comments on the same. I hope i'm not disturbing the flow.

Praveen!
But for your views/comments, this thread would have been very boring. Please bring as many views as possible to the table. We all will be winners at the end.

Best Regards,
--Ashish
http://tradingtalks.blogspot.com

bvpraveen · #**155** 4th February 2007, 11:44 AM

Hello Ashish,

Thanks for your answers for the questions posted.

Quote:

Originally Posted by aca_trader

......
But for your views/comments, this thread would have been very boring. Please bring as many views as possible to the table. We all will be winners at the end.
...

Sure..I will try to post whatever views, charts, doubts, etc I've got, over the coming days.

Good luck,
Praveen.

aca_trader · #**156** 4th February 2007, 11:45 AM

Quote:

Originally Posted by krishna murthy

dear ashish
your pattern display is fantastic, kindly forecast for rajesh export sonata software and trigyn.
thankyou
krishna murthy.

Hi Krishna!

Thanks for your words of appreciation.

Rajesh Export- Has broken the trendline but not yet given any direction. One can not short this stock and it's a time to wait for some signal to emerge before one purchases this stock.

Sonata Software - After a very good run, it went into congestion and then has broken down. Once again, shorting is not possible and long is to be stricktly avoided.

TriGyn - It has made a very good run. To enter the stock, one should wait for pullback.

Best Regards,
--Ashish
http://tradingtalks.blogspot.com

babs · #**157** 4th February 2007, 12:30 PM

http://www.stockpicks.in/forum/showthread.php?t=791

see this link similar interface of traderji.com

nice na?
babs

rangarajan · #**158** 4th February 2007, 09:05 PM

dear aca,
Could you pl see Ankur drugs (BSE 531683) chart & give yr opinion.
ranga

bvpraveen · #**159** 4th February 2007, 10:09 PM

Hello all,

I've got one doubt while identifying patterns.

While looking for any patterns in a chart, how to handle the noise which exists inside the pattern. ie for eg. if you look at the attached chart of REL_Triangle, although the patterns looks like descending triangle with upside breakout, there is lots of noise between first two pivot low/highs.

How much importance is to be given to such noises?

Of course two pivots are enough to form upper and lower trendline in the triangle, but I think the quality of the triangle depends upon the action inside the triangle too.

Your views, friends?

Thanks and regards,
Praveen.

kkseal · #**160** 4th February 2007, 11:23 PM

Quote:

Originally Posted by bvpraveen

Hello all,

I've got one doubt while identifying patterns.

While looking for any patterns in a chart, how to handle the noise which exists inside the pattern. ie for eg. if you look at the attached chart of REL_Triangle, although the patterns looks like descending triangle with upside breakout, there is lots of noise between first two pivot low/highs.

How much importance is to be given to such noises?

Of course two pivots are enough to form upper and lower trendline in the triangle, but I think the quality of the triangle depends upon the action inside the triangle too.

Your views, friends?

Thanks and regards,
Praveen.

First of all breakouts from descending triangles are usually down rather than up.
Also if you draw a line connecting the first two pivot highs you'll get a smaller desc triangle with two failed breakout (up) attempts. But each time the stk has managed to bounce back from the strong support it has around 500 lvls.

I think in such a scenario one should wait for a cross of the last swing high (i.e. the highest point of the triangle) or at least a higher high to be absolutely sure.

Regards,
Kalyan.

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