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Morning Star + Flag pattern - Trend ReversalMorning Star - The Morning Star pattern is a classic bullish reversal pattern in technical analysis. The pattern consists of three candlesticks: two large ones with different directions and a smaller candlestick between them. Flag Pattern - A sudden move in either direction followed by the price consolidates in a range following the sharp move, and the price then continues to move in the same direction after it breaks out of the range. Its visual resemblance to a flag and a pole
NSE:MBAPLEducation
by Ashiq996
breakout trading !In technical analysis, a breakout refers to a substantial price movement of a financial instrument, such as a stock or commodity, surpassing a specific level of support or resistance. This occurrence is of paramount importance, as it frequently signifies the initiation of a new trend, offering traders and investors valuable insights for informed decision-making. Outlined below are key aspects related to breakouts in technical analysis: Definition: A breakout occurs when the price of an asset surpasses a well-defined level of support or resistance. The breakout can manifest as either an upward movement (bullish breakout) or a downward movement (bearish breakout). Significance: Breakouts carry significance as they indicate a shift in market sentiment, suggesting that the prevailing trend may be weakening or reversing, potentially giving rise to a new trend. Types of Breakouts: Bullish Breakout: This occurs when the price surpasses a resistance level, signaling potential upward momentum. Bearish Breakout: In contrast, a bearish breakout happens when the price drops below a support level, indicating potential downward momentum. Volume Confirmation: Successful breakouts are often accompanied by an uptick in trading volume, serving as confirmation of the robustness of the new trend. Volume analysis is instrumental in validating the legitimacy of the breakout. False Breakouts: It is important to note that not all breakouts lead to sustained trends. False breakouts can occur, wherein the price briefly breaches a support or resistance level but subsequently reverses. Traders commonly employ additional technical indicators or await confirmation before acting on a breakout. Measuring Target: Traders frequently use the height of the pattern preceding the breakout, such as a triangle or rectangle, to estimate the potential price target. This aids in setting profit targets. Common Chart Patterns Leading to Breakouts: Triangles: Symmetrical, ascending, or descending triangles often precede breakouts. Head and Shoulders: Both inverse and regular head and shoulders patterns can signal potential breakouts. Rectangles and Flags: Consolidation patterns like rectangles and flags can lead to breakouts. Role of Trendlines: Trendlines are commonly employed to identify potential breakout points. The intersection of a trendline with a support or resistance level is deemed a critical zone for a potential breakout. Risk Management: Traders typically incorporate risk management strategies, such as setting stop-loss orders, to safeguard against false breakouts or adverse market movements. In summary, breakouts in technical analysis are pivotal events offering valuable information to traders and investors about potential shifts in market trends. Effective breakout trading strategies involve confirmation, volume analysis, and meticulous consideration of various chart patterns.
NSE:MPHASISEducation
by pratik2358
2
Mastering the Symmetrical Triangle chart patternHello Friends, Here we had shared Educational purpose post to understand & to master the Symmetrical Triangle chart pattern with real example on chart of the stock MARUTI. Symmetrical Triangle Chart Pattern A symmetrical triangle is a common chart pattern used by traders and investors to predict where the price of a stock or asset might go next. What It Looks Like Imagine two lines on a chart. One line is sloping up, and the other is sloping down. These lines meet at a point at the top of the chart. It looks like a triangle, where the lines squeeze together. What It Means Symmetrical triangles show that traders are unsure about where the price will go. It's like a coiled spring, ready to bounce in one direction. Why It's Important When the price breaks out of the triangle, either going up or down, it can be a signal of a big move. If it goes up, it's considered bullish (good for buyers). If it goes down, it's bearish (not so good for buyers). Trading Tips Wait for a clear breakout before making a trade. Don't rush. Watch the volume (how many shares are traded). A big volume increase during the breakout is a good sign. Be cautious of false breakouts – sometimes the price goes out of the triangle but then comes back in. If you already own the stock, hold onto it until you see which way the breakout goes. If you don't own the stock, consider buying after a reliable breakout in the direction of the major trend. In simple terms, a symmetrical triangle is like a pause in the market where everyone is waiting to see which way it will go next. Traders use it to make decisions about buying or selling stocks or assets. Setting Stop-Loss and Targets Stop-Loss A stop-loss is a predetermined price level at which you decide to sell your position to limit potential losses. When trading a symmetrical triangle pattern: Place your stop-loss just below the lower trendline if you're buying (bullish breakout). Place your stop-loss just above the upper trendline if you're selling short (bearish breakout). The stop-loss helps protect your capital if the breakout goes against your trade. Price Targets Price targets help you determine where the price may move after the breakout. You can calculate potential price targets using the triangle's height: Measure the height of the triangle (the vertical distance from the lowest low to the highest high within the triangle). After a bullish breakout, add the height to the breakout point for an upside target. After a bearish breakout, subtract the height from the breakout point for a downside target. These targets can help you set realistic profit objectives. Keep in mind that they are not guarantees, but rather potential price levels where the asset might move. Remember that trading involves Risk, and it's important to use risk management tools like stop-loss orders to protect your investments. Additionally, price targets provide guidance but don't guarantee specific outcomes, so it's essential to monitor the market's actual performance after a breakout and adjust your strategy as needed. I am not sebi registered analyst. My studies are for educational purpose only. Please Consult your financial advisor before trading or investing. I am not responsible for any kinds of your profits and your losses. Most investors treat trading as a hobby because they have a full-time job doing something else. However, If you treat trading like a business, it will pay you like a business. If you treat like a hobby, hobbies don't pay, they cost you...! Hope this post is helpful to community Thanks RK💕 Disclaimer and Risk Warning. The analysis and discussion provided on in.tradingview.com is intended for educational purposes only and should not be relied upon for trading decisions. RK_Charts is not an investment adviser and the information provided here should not be taken as professional investment advice. Before buying or selling any investments, securities, or precious metals, it is recommended that you conduct your own due diligence. RK_Charts does not share in your profits and will not take responsibility for any losses you may incur. So Please Consult your financial advisor before trading or investing.
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NSE:MARUTIEducation
by RK_Chaarts
15
Turbo Breakout Setup: High-Probability Trades with Precision.NSE:CNXFINANCE Hello Traders, In this video, I have explained a Breakout trading setup that will generate only high-probability breakout trades, that have high success rate than another breakout. The setup is based on a pure price action structure and does not require any indicators just we are using volume as a confirmation tool. Why does this setup work? The logic is very simple let's talk about the 1st variation of this setup:- Fake Breakout as you can see in this setup most of the time the structure completes after a fake breakout. So that fake breakout means the short sellers in the correction phase trying to defend there stop loss and make prices go down but what do you think for how long they will be able to defend that zone when buyers' strength is increasing? so after that when buyers push the price a little above-failed breakout zone the price hits short sellers stop losses and include new buying at that level to push prices toward the sky. What about scenario 2nd:- NO failed breakout but horizontal range inside trend resistance line. When the trend Resistance line and horizontal line break at the same price point it invites many traders to put a limit order above that horizontal line and most of the short sellers also have put their stop loss when that zone hit the price again and start moving towards the sky. Other factors and detailed setup have been explained in the video. Any setup is useless without a pre-defined stop loss cause you need to focus on capital protection first then you can aim for profits. Always take calculated risks and use proper position sizing. This is only for educational purposes only. Always trade with stop-loss. I hope you found this idea helpful. Please like and comment. Share with Your Friends. Keep Learning, Happy Trading!
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NSE:CNXFINANCEEducation
by SANJAYPATIDAR_
9
Bearish Flag PatternWhat is a bear flag pattern : A bear flag pattern is a continuation pattern that resembles an upturned flag with a pole. It shows a continued bearish downtrend broken midway by a pullback – the upward channel or triangle representing the flag. Criteria: 1. The pattern can be misleading if the retracement or the flag is larger than 50% of the pole.  2. RSI will help you gauge the strength of the pattern and the momentum after it. How to trade it : 1. If the Flag section gets broken upside, It may invalid the pattern. 2. If the Flag section gets broken downside, consider the Pole section price range as the target from the break down point. Check relative strength before entering the trade, It will help you to gauge the strength
NSE:NIFTY1!Education
by OK_Rane
How to play potential level breakout (From my latest trade)Steps 1) Identify potential breakout zones , crucial supports , resistances ,trend line , Patters like (triangle , rectangle , consolidation ) TATA POWER other examples UJJIVAN ADANIENT BTCUSD BANKNIFTY 2) Wait for breakout "do not enter just seeing the breakout " ,watch carefully the volumes , then wait for a price to retest the level. Many times when the prices make a crucial level , big players tend to exhaust this opportunity and fools us by fake breakout you can see my UJJIVAN idea in the links below. 3) when in price retest and start moving up then enter above just high of recent up swing and keep sl at the low of latest down swing. This three steps are most effective approach for playing out the breakouts.
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NSE:TATAPOWEREducation
by TRADEWITHFUN247
18
#Education #update ****Educational Post: Head and Shoulder pattern Head and shoulders is a chart pattern in which a large peak has a slightly smaller peak on either side of it. Traders look at head and shoulders patterns to predict a bullish-to-bearish reversal. Typically, the first and third peak will be smaller than the second, but they will all fall back to the same level of support, otherwise known as the ‘neckline’. Once the third peak has fallen back to the level of support, it is likely that it will breakout into a bearish downtrend. ****Educational Post; Bearish Flag The bearish flag is a candlestick chart pattern that signals the extension of the downtrend once the temporary pause is finished. As a continuation pattern, the bear flag helps sellers to push the price action further lower. These three elements are integral for the bearish flag to occur: The flagpole - the asset’s price must trade lower in a series of the higher highs and higher lows; Flag - a consolidation must take place between two parallel trend lines in an uptrend; A breakout - a break of the supporting trend line signals the activation of the pattern.
Education
by nawaab001
2
Dow @ critical levels.FOR EDUCATIONAL PURPOSE ONLY! This is a daily chart of Dow . It has taken a support exactly at its daily support trendline (blue). From last several months, Dow has been trading in a range on weekly charts which can be seen in pink lines. On weekly charts Dow has made a flag and pole pattern and either it takes support at this level or may give break down. If it gives break down then it will be a bad signal for entire markets around the world. Break down on a weekly chart means begining of a down trend in Dow and eventually markets around the world would break down. 33682 is a very import support for Dow and if it starts to trade below that, keep a very strick SL of your portfolio on Daily charts .
DJ:DJIEducation
by AbNamjoshi
Indicator Free Analysis using Simple Price Action - A Case StudyThis is the monthly chart of BATA India. In this we can see that there was a bull run from December 2016 to March 2020. It came down slowly to form a falling wedge pattern and also a double bottom pattern from Mar 2020 to June 2021. It gave a good breakout of the falling wedge or flag pattern in July 2021 and the momentum continued. Here we have not used any indicators and are simply following price action. According to the price action, a big resistance is at 1800 levels where the stock may halt before giving breakout. How to trade the stock? 1. After getting a confirmation that the stock has broken out of a bullish flag pattern, we could have taken a trade at 1600 levels with a SL of 1200 and a target of 2200-2400 2. At present too, we can buy the stock between the levels of 1700-1800 with the same SL of 1200 and a target of 2400. How was the target calculated? The total distance covered by from the highest point of the flag ( approx rs 1800) to the lowest point of the flag (approx Rs 1200) should be calculated i.e. Rs 600. Now on giving breakout, the stock should ideally move Rs 600 from the highest point of the flag (Rs 1800). Thus the long term target comes out to be Rs 2400. However it is just a prediction. So one should give or take a standard +/- 5% deviation from the predicted target. PS - This stock has been chosen for only an ideal case study. This is not a recommendation. The stock may or may not perform as predicted or described.
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NSE:BATAINDIAEducation
by tksthathachari
22
Importance of Multiple Confirmations-Indicator Free AnalysisIndicator Free Analysis with Fibonacci Ratio Integration: The above is a daily chart of Alkyl Amine, a quality monopoly stock with clear cut competitive edge in its respective industry. We can observe that a previous resistance was present at 4000 levels which was broken with big bullish harami green candles accompanied with volume. A basic rule of chart analysis is whenever a stock breaks out of its resistance, the resistance is transformed into a support. Thus the stock again comes back to the resistance level in order to check if it has turned into support. This is called retest or throwback. Here the stock has tested the 4000 levels 2-3 times and is now trying to head upwards. In addition, if we draw a fib chart, we can see that the stock is taking support at the 0.618 levels which can be regarded as ultimate support zone. We can also observe that a bullish Flag and Pole is formed which indicates upmove How to trade the stock? The stock can be traded in two ways depending on one's risk appetite and experience. Entry: For risky and experienced traders: They can enter the stock after a bullish candle (such as that of today is formed) is formed with a SL below 3900. For safe traders: They can enter the stock as soon as the stock gives a breakout above the flag i.e. formation of a bullish green candle with closing above flag. Benefits of early trade: By entering early, the experienced or risky traders decrease their stoploss to a great margin. Thus it is possible for them to re-enter if the stock hits the StopLoss and again moves up. Benefits of Confirmed Trade: By entering after the breakout and retest of the Flag pattern, a safe trader increases the probability of success to a great extent. Where should the target be? The target should be the tip of the Flag i.e. 4750. Where should be the Stop Loss? For the early entree, the Stop Loss should be just below the support trendline of 4000 i.e 3900 For the safe trader, the Stop Loss should be placed just below the upper trendline of the Flag i.e. around 4100-4150 Hope you all learnt something..Support me by sending some cheers and liking all my ideas .
NSE:ALKYLAMINEEducation
by tksthathachari
3
What is Bullish Flag Pattern?What is a Bullish Flag Pattern? The bullish Flag pattern is usually found in assets with a strong uptrend. It is called a flag pattern because it resembles a flag and pole. Pole is the preceding uptrend where the flag represents the consolidation of the uptrend. How does Bullish Flag Pattern? The flag pattern resembles a parallelogram or rectangle marked by two parallel trendlines that tend to slope against the preceding trend. Phase 1: Preceding Uptrend When there is an extreme demand in prices there is an uptrend. It continued as the demand increases. Phase 2: Flag After the sharp uptrend when supply increases more then the demand prices move to the consolidation phase or flag phase. This acts as a small price channel. Phase 3: Uptrend Continuation As the flag is a pause in an uptrend, as prices consolidate investors again start to show interest in the asset which eventually leads to heavy demand again which further leads to a breakout and uptrend continuation. Role of Volume: Volume plays a vital role in the completion of the Bullish Flag pattern. When in a preceding uptrend the volume is quite higher. In the flag phase, the volume starts to go down as investors are least interested to buy and sell that particular asset. And again on the breakout, the volume surges. Volume with Breakout gives a good indication of a successful uptrend. Above Chart Explanation: This is 4H chart of SOLUSDT We can see a good preceding uptrend with great volumes. Then after the uptrend, we enter the second phase the flag phase we can see perfect bounce and retracement from upper and lower trendlines or flag with diminishing volumes. And again a breakout with good volumes. Here could be the two possible entries one at the bottom of the flag that gives us a very low-risk entry if it breaks the flag we exit. And second entry can be at breakout, first, we have to confirm that the breakout is legit for that we can look at the volumes rising volumes to confirm that the breakout is legit. Usually, we should target the length of the pole after the breakout. Conclusion: Bullish Flag is a continuation pattern it occurs quite often on charts and is one of the most reliable continuation patterns. Comment your thoughts on Bullish Flag Pattern in the comment section below. Disclaimer: This is just an educational post never trade just any pattern. And please do your research before making any trades. PS: We are again publishing this for our Indian Audience Happy Trading!
Education
by Coinlog
3
How to make a winning trade using pennants A pennant is a small symmetrical triangle that begins wide and converges as the pattern matures (like a cone). Here is an example of IEX. The company has declared a good set up of numbers on 22nd July. Profit after tax is up by 48% Sales are up by 36% The price is now hovering near the previous Resistance which now acts as a support Tight price range near the support level. Look at the small candles. Price goes up with rising volume on 23rd Aug. Any pattern may falter depending on the overall market condition. So one should always keep a stop loss. :) Hope you liked the idea. Happy trading.
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NSE:IEXEducation
by ObliviousChart
6
Bullish Flag PatternFlag Pattern is one of the most popular chart patterns, formed by price action, which is contained within a small rectangle or a channel in the shape of a flag. Flags are short-term continuation patterns that mark a small consolidation before the previous move resumes. A flag chart pattern is formed when the market consolidates in a narrow range after a sharp move. Usually a breakout from the flag is in the form of continuation of the prior trend. Flags give very relatively small risk and high and quick profits. # What is Bullish Flag Pattern? When the prices are in an uptrend a bullish flag pattern shows a slow consolidation lower after an aggressive uptrend. This indicates that there is more buying pressure moving the prices up than down and indicates that the momentum will continue in an uptrend. Traders wait for the price to break above the resistance of the consolidation after this pattern is formed to enter into the market. # Trading with Bullish Flag Pattern ? Traders can enter into a trade when the price breaks above the upper trend lines. It is formed when there is an increase in the demand that makes the prices to move up .When the demand is more than supply, price breaks outside the flag above the resistance and prices continue to move upwards. # Duration: Flags are short-term patterns that can last from 1 to 12 weeks. There is some debate on the timeframe and some consider 8 weeks to be pushing the limits for a reliable pattern. Ideally, these patterns will form between 1 and 4 weeks. Once a flag becomes more than 12 weeks old, it would be classified as a rectangle. The reliability of patterns that fall between 8 and 12 weeks is debatable. # Volume: Volume should be heavy during the breakout of flag upper boundary . #Stop Loss: A stop-loss can be placed outside the flag on the opposite side of the breakout. Kindly Let us Know if you have any question .
NSE:RELIANCEEducation
by PrasantaP
2
BULLISH FLAG PATTERN EXPLAINED.Bullish flags are a continuation pattern found in stocks with a strong uptrend. As can be observed, the pattern resembles a flag on a pole. The vertical rise forms the pole and the following period of consolidation forms the flag. The flag can be a horizontal rectangle but mostly angles down from the pole. The focus should be more on the underlying psychology of the pattern than the shape. Despite the strong vertical rally, the stock refuses to drop much because the bulls are buying as many shares they can get their hands on. ________________________________________________________________________________________________________________________ Main characteristics of a flag pattern: 1. The trend before the appearance of the pattern. 2. The channel of consolidation. 3. The volume behavior. 4. The breakout. 5. The confirmation of price movement in the direction of the breakout. _______________________________________________________________________________________________________________________ Target and Volume: The target for a bull flag is calculated by measuring the length of the flag pole and projecting it from the breakout point. The volume starts to pick up towards the end of the consolidation range indicating the oncoming breakout. Then there is a huge increase in volume when the pole is being formed and the volume tapers off during the consolidation period. ______________________________________________________________________________________________________________________ Stop Loss Options: 1. Longer term traders may place their stop loss below the entire flag. 2. A stricter option would be just below the consolidation are before the breakout. 3. The tightest option would be a two bar low trailing stop. ______________________________________________________________________________________________________________________ Thoughts: No one can know for sure which way the price will move, whether it will continue or reverse. One can follow the action of price, trade only the best setups and let the probabilities work out. While patterns may give false signals, bullish flags are generally reliable and effective. ______________________________________________________________________________________________________________________ Alert: Keep an eye out for price action unravelling currently. Price is pulling back to the 20 EMA, forming a consolidation, a flag of sorts. A continuation candle near the average with decent volumes could be the sign of a fresh move upwards. _____________________________________________________________________________________________________________________ Will be very grateful for a like and follow. :)
GEducation
by Tradeception_
7
Trend Continuation PatternBullish Flag Chart Pattern: Tata Chemicals Description: The flag represents a brief pause in a dynamic market move & one of the requirements for a flag pattern is that it should proceed by a sharp and almost straight-line move. It represents situations where a step advance or decline has gotten ahead of itself, and where the market pauses briefly to "catch its breath " before running off again in the same direction. Construction of Flag & Pole pattern: The flag resembles a parallelogram or rectangle market by two parallel trendlines that tend to slope against the prevailing trend. The flag usually occurs after a sharp move & represents a brief pause in the trend. The flag should slope against the trend. Volume should dry up during the formation & built again on the breakout . How to trade flag and pole patterns: The sideways period is often followed by another sharp rise. This is where the trading opportunity comes in. Once the flag pole and a flag or have formed, traders watch for the price to breakout above the upper flag/trend line. When this occurs, enter a long trade. Conclusion: 1-Flag patterns are a commonly used technical analysis tool and majorly a choice of breakout traders and swing traders. 2- Flag is formed when there is a minor profit booking in either an uptrend or a downtrend. 3- The pole is formed by a line that represents the primary trend in the market. 4- It is important that flags are preceded by a sharp advance or decline.
NSE:TATACHEMEducation
by Indrajit08
3