Patterns and supply/demand

Discuss Patterns and supply/demand at the Technical Analysis within the Traderji.com - Discussion forum for Stocks Commodities & Forex; I think flag patterns are quite reliable. In a downtrend if it goes up a ...


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Old 11th March 2007, 07:28 PM
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Default Patterns and supply/demand



I think flag patterns are quite reliable. In a downtrend if it goes up a little and the bars are close to each other you can suspect there are now people buying (going long) right? SO if it breaks down again they will get scared and sell which will make the trend continue. But do you know that the small up move will be longs instead of shorts covering? I guess covers would push price up more because they don´t care so much about exact price so they can afford market price.

When it breaks down i think according to a an author whose name i forgot the best is to short when it goes below the bottom of the flag. Maybe it is a question of finding out where most of the buyers in the flag have their stops and will sell? The low is logical but the market keeps changing.

If you short there would you have a stop at the top of the flag? It does not give such a good risk/reward but it might work. Or would you work with lower timeframes and keep a tight stop?

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