Stock Market Basics to Advance - Lecture 10
( Part 2 - Chart Pattern)
B) Reversal Patterns:
1) Double Top & Double bottom Pattern:
a) Double
Top Pattern:
- This pattern forms selling opportunity
- This pattern forms 2 tops which acts like resistance
- After Double top pattern, downtrend starts
- After crossing neckline, entry can be made in downside
b) Double
Bottom Pattern:
- This pattern forms buying opportunity
- This pattern forms 2 bottoms which act like support
- After Double bottom, uptrend starts
- After crossing neckline, entry can be made in upside
2) Triple
Top and Triple Bottom Pattern
a) Triple Top Pattern:
- This pattern forms selling opportunity
- The triple top is a bearish reversal chart pattern that leads to the trend change to the downside
- This pattern forms 3 tops and then downtrend starts below neckline
- Entry made after crossing neckline
b) Triple
Bottom Pattern
- This pattern forms create buying pressure
- Triple bottom pattern is a bullish reversal chart pattern that leads to the trend change to the upside
- This pattern forms 3 bottoms and then uptrend starts above neckline.
Stock Market Basics to Advance - Lecture 10 ( Part 2 - Chart Pattern)
C. Bilateral Patterns
1)
Triangle Pattern :
- This
forms triangle like pattern so called as triangle chart pattern.
- Again, it
is divided into 3 types Symmetrical ,
Ascending , Descending Chart Pattern
Rules:
- Check support and resistance levels
- Check Volume
- Take Trade after clear breakout or breakdown
a) Symmetrical Triangle Pattern:
b) Ascending Triangle Pattern:
C) Descending Triangle Pattern:
2) Wedge Pattern :
- A wedge price pattern is shown on a chart by converging trend lines, where the two lines are marked to connect the respective highs and lows of a price series.
- It can be continuation as well as reversal wedge pattern
a) Continuation Wedge pattern
b) Falling Wedge pattern
3. Channel Pattern
- It can be continuous as well as reversal.
- Price is moving between two lines which are parallel to one another similar to flag pattern.
- Whichever side it gives breakout, take trade in this direction.
- There are two types of channel patterns
1. Ascending Channel Pattern
2. Descending Channel Pattern
Stock Market Basics to Advance - Lecture 10 ( Part 2 - Chart Pattern)
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