breakout

You mean in this forum... That only Traderji can reply. ut if you are interested in learning you can visit http://www.elliottwave.com/education/tutorial/ they have a free training course. You have to join their CLUB EWI (free)

karthik

karthik,
do you know what does "iFast amplitude (1%): bullish wave 1" means?

cmlee, what is metastock ? I would like to use this for assisting me in trading,
can some1 guide me in using it and where to download it from ? Thanx ,
Huzefa

Have posted the following at my thread too. Placing it here in case some members miss it there.

Two technical analysis terms that come up often are Double Top and Double Bottom.
I am making some notes here on the dynamics of these, to widen our understanding of a most vital and recurrent theme that appears in almost all charts I have come across. An understanding of these would help in determining a crucially decisive phase in the long or short term trend in the progress of price movement of a scrip.
The Double Top and Double Bottom formations are invariably the true harbingers of an oncoming trend reversal. They are the fulcrum points where an extended up or down trend, or even a short term up or down trend, is about to turn direction.

The Double Top pattern as the term implies, is the formation of two successive peaks that are roughly equal in height, with a mild valley in between. There may be variations, but the typical Double Top marks either a short term or long term change, in the movement of a trend from bullish to bearish.
Assuming the existence of a long or short up-trend, the first peak would mark the highest point of the trend. As such, the peak in itself is a normal occurrence and there is no threat to the up-trend as yet.
At the culmination of the first peak, a decline takes place that would usually drop to a point about 20% from where the peak had started building up. The decline or increase in volume during this pullback has no real significance. The bottom of this decline is normally extended sideway slightly, to give a ‘u’ shape to the trough being created.
Here begins the second climb and will normally occur with low volume. It then tests the level of the previous peak. At the confirmation of any resistance here, the possibility of a Double Top arises. This pattern now awaits further confirmation, as this resistance may well be just a resistance in the ongoing up trend.
The gap between the peaks may vary, depending on if it’s a long trend or a short one. It can be a few days, weeks, or months. Another norm with the twin peaks is the exactness in their heights. A slight variance is allowed usually.
The second decline coming off the second peak would be on increased volume, and increased velocity. This indicates that the supply far exceeds demand. Also, a fresh lot of short traders are attracted here, and the price begins to slip steeply. The level at the bottom, where the first peak/climb had begun, is now the crucial support point, and moving down towards it, the Double Top yet remains unconfirmed. Once this support is tested and convincingly violated, the pattern is complete. To extend this further, the newly broken support level would act as a resistance to any attempted upside again, and would normally not get breached as the demand is poor. Here is another opportunity to trade a short. With declining demand and increased supply, the price begins to spin downwards. More supports are broken, and now a bearish down trend is fully in place. The trend reversal has come to pass.
There could be false Double Tops too. The trend is always in force until proven otherwise. Until the key support is broken in a convincing manner with expanded volume, the up trend will remain intact.

A Double Bottom, the formation of which signifies a trend reversal from bearish to bullish, is in terms of its dynamics, an exact inversion of a Double Top.
I’m sure the explanation above of the Double Top is clear to understand, in order to conceptualise the workings of a Double Bottom.
Should any member feel interested in a similar explanation of the Double Bottom for clarity, I’d be happy to do it.
So much for now.

NEW COMERS TO TA TO NOTE

You can never get a better explanation to DOUBLE TOPS than this....hence make the best out of this...

Amit... I have a request.... If you get the time ...do explain about Momentum Trading..may be in a separate thread...

regards

karthik

Yes karthik kumar well said there couldnt be any better explanation than this iam sure .Amitbe is going great guns with his services. I wish it lasts for ever.I am proud to be in this excellent forum. thanks to traderji.

hi, I want to explain the psychology behind this pattern. Once the peak is formed and the correction is on, the investors who entered in the last leg of the rally, generally are not interested to exit their positions. The price move , generally, will be in such a way that it always creates some hope to the investor. And as the rally was in place before the correction, there will be plenty of buy orders in the system and the price moves steadily downwards. After certain fall, the price halts for the reason that there is no buying or selling interest. All orders in the system disappear. The seller looses interest to sell at such price and buyer looses hope on the rally to come back again. In such scenario generally markets react in the opposite direction of the trend and the move will be with fear. And here one more point to be observed is understanding "where the orders will be." Generally the markets move in the direction where more orders are present. I call it the gravity of the orders. At the point where the fall or reaction to the rally halts, then the orders at the earlier peak start getting accumulated and these orders pull the price backwards. Pl. try to understand what is happening behind the chart. It looks strange to hear that these sell orders pull the markets upwards. But it happens. Even if you observe the moves in intraday, after a steep fall the markets usually pull back on a slow phase and you can see fear in the chart. And once the price starts climbing, the asset gains strength and the price starts slightly accelerating. With this impetus, again the rally will be on. But as the accumulated sell orders at the previous top act as resistance and start pushing the prices downwards. And this is the time, even the earlier entrants in to the security (who entered in the earlier rally) get out of the asset in addition to the investors who took position in the corrective rally. And as the supply increases, the price slids and generally the move will be steep because this time, there won't be that many buy orders in the system as they were in the first rally. And there will be more sell orders because of the new entrants in the corrective rally. And the genuine buyers will again come in case all the sell orders at the second top get absorbed. One all the sell orders are absorbed, then naturally one more rally is in place. And this is vice versa for the fall.

Hope this didn't confuse. But i understand my presentation lacked a rhythm. Pl. post your doubts, in case if any and i will try to clarify in detail with examples.
AJAY

Great stuff,Ajay.........keep em coming!!

Saint

AJAY,
maybe you can try to elaborate using some charts or diagrams?

Hey Karthik and mkshekar...nah..I'm sure there are all sort of better pieces written by masters of TA. Perhaps I have just put it in an easy and accessible language, that's all.
Sure Karthik, will do something on Momentum Trading, perhaps on Sunday...feeling a bit ill today..viral it seems.