BreakOuts

aca_trader · #71 16th September 2006, 01:30 PM

Some Candidates.

Best Regards,
--Ashish

rahulg77 · #72 17th September 2006, 06:11 PM

Quote:

Originally Posted by karthikmarar

Hi rahul

Ofcourse Divergences in ROC are important signals.

For looking at the divergences either connect all the peaks in the price chart and the indicator or connect the bottoms. You cannot connect the peaks in the indicator and connect the bottoms in the price chart.

of course a minor divergence did happen in Mcdowell and the corresponding decline also happened. Now the stock looks likely to continue its journey northwards.

Chart enclosed.

warm regards

karthik

Dear Karthik,

What kind of divergences can be there. Lets take bearish divergences. I will write down the three types I know and please correct me if I am wrong. I will write RSI as a general indicator

-price is rising and RSI is going down. Like we saw in Mc dowell.

-Price is rising and RSI is sideways..

- indicator is rising and Price rise is very small ( this is what nifty is projecting now was being discussed by you- is it?).

Now if RSI is rising and price moves down ( that will be a bullish divergence) or does that depend if it has happened in an uptrend or downtrend. I have not been able to grasp divergences very well.

Rgds

Rahul

karthikmarar · #73 19th September 2006, 12:55 AM

Quote:

Originally Posted by Roshanna

hi karthik,
recently went through ur old posts regarding Breakouts. (mostly addressed to Cmlee, somewhere last year same time)
can u post the AFL for metastock formula for congestion breakout u had given there?
regards

Hi Roshanna

Enclosing the afl. It is just the translation of the metastock one.
Since i have come a long way since the time it was posted I am not really happy with this one. Need some refinement. I will work on it. Till then, hope this will suffice.

regards

karthik

karthikmarar · #74 19th September 2006, 02:15 AM

Quote:

Originally Posted by rahulg77

Dear Karthik,

What kind of divergences can be there. Lets take bearish divergences. I will write down the three types I know and please correct me if I am wrong. I will write RSI as a general indicator

-price is rising and RSI is going down. Like we saw in Mc dowell.

-Price is rising and RSI is sideways..

- indicator is rising and Price rise is very small ( this is what nifty is projecting now was being discussed by you- is it?).

Now if RSI is rising and price moves down ( that will be a bullish divergence) or does that depend if it has happened in an uptrend or downtrend. I have not been able to grasp divergences very well.

Rgds

Rahul

Hi Rahul

I think you are confusing yourself with divergences ( and me too

)

Don’t complicate it. Keep it simple.

When the prices are making higher highs and the momentum indicator fails to make higher highs then there is a divergence. It would mean that the momentum is faltering when the price is still moving up. Then the price is likely to reverse and follow the direction of the Momentum indicator. Here since the momentum is unable to keep up with the bullish price movement, the divergence will eventually cause bearishness and hence called a bearish divergence.

In the same manner the price is making lower lows and the momentum indicator fails to make a lower low it will cause a bullish divergence.

Some points to note.

Stick to the conventional understanding of divergence. Compare peaks and troughs of the Price and Momentum Indicator. Don’t compare side ways movements.

Divergences give only warning signals and are never decision making signals.

There could be multiple divergences before the actual reversal take place. The time span between the divergences is important. Longer the time span the more forceful the reaction will be.

Also important is the time frame is important. A divergence in a particular time frame will cause a reversal applicable to that time frame. For example a divergence in a hourly chart will cause a reaction in relation to that time frame. A divergence in a weekly chart will cause a reaction relating to that time frame which of course will be large.

Don’t give so much importance to divergences. Like I said before when a good divergence occur it will be clearly visible on the charts.

regards

karthik

Roshanna · #75 19th September 2006, 07:55 PM

Hi karthik,
downloaded but i just get a straight line
what am i doing wrong?

Quote:

Originally Posted by karthikmarar

Hi Roshanna

Enclosing the afl. It is just the translation of the metastock one.
Since i have come a long way since the time it was posted I am not really happy with this one. Need some refinement. I will work on it. Till then, hope this will suffice.

regards

karthik

rahulg77 · #76 20th September 2006, 06:48 PM

Hi,

I was seeing the charts of Nandan exim and the charts looked like it has formed a cup with handle and has broken out. though the handle looks very noisy but if seen on a line chart it is more clear.

it can also form a c&h at the high of today if it pulls back. Intially i had drawn the rim of the cup at the high of today as that also forms a cup but we have to see if it goes to form a handle here or is the previous formation a complete one. I have attached both the layouts.

All indicators also look good.

Any Views??

Rahul

karthikmarar · #77 20th September 2006, 07:33 PM

Quote:

Originally Posted by Roshanna

Hi karthik,
downloaded but i just get a straight line
what am i doing wrong?

Roshanna

Looks like you have plotted the indicator in the price chart itself. This indicator values is normally zero and one when the breakout happens. So normally we get a spike in the chart when the breakout happens. A red colored spike for upside breakout and a blue colored one for downside breakout. So if you plot in the same window of the price chart you will not see any change as the values are only 0 and 1.

So plot the Indicator in a separate window and try.

regards

Karthik

aca_trader · #78 20th September 2006, 08:49 PM

Quote:

Originally Posted by rahulg77

Hi,

I was seeing the charts of Nandan exim and the charts looked like it has formed a cup with handle and has broken out. though the handle looks very noisy but if seen on a line chart it is more clear.

it can also form a c&h at the high of today if it pulls back. Intially i had drawn the rim of the cup at the high of today as that also forms a cup but we have to see if it goes to form a handle here or is the previous formation a complete one. I have attached both the layouts.

All indicators also look good.

Any Views??

Rahul

Hi Rahul!

Good ONe. One can go long above 14.5.

Best Regards,
--Ashish

kenneth · #79 20th September 2006, 10:22 PM

Quote:

Originally Posted by karthikmarar

Roshanna

Looks like you have plotted the indicator in the price chart itself. This indicator values is normally zero and one when the breakout happens. So normally we get a spike in the chart when the breakout happens. A red colored spike for upside breakout and a blue colored one for downside breakout. So if you plot in the same window of the price chart you will not see any change as the values are only 0 and 1.

So plot the Indicator in a separate window and try.

regards

Karthik

Hi Karthik,

Afl needs to be edited to

Plot(bdn,"Downside breakout",colorBlue);

Regards
Kenneth

karthikmarar · #80 20th September 2006, 10:48 PM

Kenneth

Thanks a lot. It really looks like time for break for me...

For those who hate coding.... like me, here is the corrected afl.

Regards

Karthik

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