Showing posts with label Fun. Show all posts
Showing posts with label Fun. Show all posts
Trying hard to convince my friends with "ridiculous analysis"
Hi,
Taking forward my "ridiculous analysis" and adventures with chart patterns.This post is in relation with the previous post on Suzlon (link below under "Related Post").Check out this new chart ,I have use the same chart ,same stock,and the same chart pattern.The target this time I have given "appears achievable", below are some details of the chart.
Suzlon, as it broke down and made a Symmetrical Triangle Pattern.The measuring move target will be approximately 40 as the width of triangle is 33 and it broke down from 73 level.The target sounds achievable and trade appear quit lucrative.If you check the previous price action it made a low of around 33 during the bear market.Therefore 40 seems all the more convincing.I can very easily build a bear case for the stock with this kind of analysis.
This post is the last one in this "Fun with Chart Patterns" series,if you want to have more entertainment, you need to do the following.
1)Find a stock 50 Rs stock or under
2)Check out it's chart and find a bearish chart pattern
3)Chances are high that all patterns will give negative targets
4)If you are feeling lazy to search then check out TTML,DLF,HDIL,ISPATIND,IDEA ,just to name a few.
Why this failed pattern is so common?
The answer is simple it's because we witnessed a sharp V-Shaped recovery after the bear market and the election result gap, just made the things worst for chart pattern followers.And now when "Time" is finally catching up with "Price" we are getting this pattern. Trend-lines drawn to make this pattern will get violated someday or the other.In these cases it is on the down side,giving unreasonable negative targets
Now my question.
If the break of trend line was on the upside,would you consider buying this stock?
All the chart patterns if they give bullish targets, will find people lined up to put their hard earned money in that stock idea.The bullish targets will always be possible as a stock can rise to infinity.However the downside targets are limited to zero!!It seems even the ancient mathematicians had "the bullish bias" they never put a ceiling on the numbers but made zero as the base number!!
Cheers
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Related Post
Suzlon : Short with a target of -30 (yeah right minus 30)!!
Taking forward my "ridiculous analysis" and adventures with chart patterns.This post is in relation with the previous post on Suzlon (link below under "Related Post").Check out this new chart ,I have use the same chart ,same stock,and the same chart pattern.The target this time I have given "appears achievable", below are some details of the chart.
Suzlon, as it broke down and made a Symmetrical Triangle Pattern.The measuring move target will be approximately 40 as the width of triangle is 33 and it broke down from 73 level.The target sounds achievable and trade appear quit lucrative.If you check the previous price action it made a low of around 33 during the bear market.Therefore 40 seems all the more convincing.I can very easily build a bear case for the stock with this kind of analysis.
This post is the last one in this "Fun with Chart Patterns" series,if you want to have more entertainment, you need to do the following.
1)Find a stock 50 Rs stock or under
2)Check out it's chart and find a bearish chart pattern
3)Chances are high that all patterns will give negative targets
4)If you are feeling lazy to search then check out TTML,DLF,HDIL,ISPATIND,IDEA ,just to name a few.
Why this failed pattern is so common?
The answer is simple it's because we witnessed a sharp V-Shaped recovery after the bear market and the election result gap, just made the things worst for chart pattern followers.And now when "Time" is finally catching up with "Price" we are getting this pattern. Trend-lines drawn to make this pattern will get violated someday or the other.In these cases it is on the down side,giving unreasonable negative targets
Now my question.
If the break of trend line was on the upside,would you consider buying this stock?
All the chart patterns if they give bullish targets, will find people lined up to put their hard earned money in that stock idea.The bullish targets will always be possible as a stock can rise to infinity.However the downside targets are limited to zero!!It seems even the ancient mathematicians had "the bullish bias" they never put a ceiling on the numbers but made zero as the base number!!
Cheers
.png)
Related Post
Suzlon : Short with a target of -30 (yeah right minus 30)!!
Suzlon : Short with a target of -30 (yeah right minus 30)!!
Hi,
I have been follow Suzlon for sometime now.Being a follower of technical analysis and chart patterns,I noticed this Symmetrical Triangle Pattern.If a stock breakouts or breakdown from the converging trend lines,it is believed that it will continue to move in the respective direction.A target is generally equal to the width of triangle.This method is popularly known as "the measuring move" with respect to chart patterns analysis
Check the chart given below of Suzlon, as it broke down and made a Symmetrical Triangle Pattern.The measuring move target will be approximately -30 (minus 30) as the width of triangle is 100 and it broke down from 70 level.If it had broken the trend-line on the upside, the the target would have seemed possible,specially as we are in this bull trend.
Now -30 is impossible so we will swiftly do away with this chart pattern.But if we see a similar chart pattern in an intraday chart,we will trade it,and might trade it profitably.That reinforces our belief in chart patterns.
I have got nothing against chart patterns.I just want to highlight the psychological aspect of how we process the information which we get by charts as per our convenience.We bend the rules to prove our point.Just as I have done here!! Uploaded an obvious failed chart pattern out of so many successful chart patterns.But I want you to think about it's effectiveness when logically the target sounds possible......so will it work with some other stock, some other time ?
Related Post
Trying hard to convince my friends with "ridiculous analysis"
I have been follow Suzlon for sometime now.Being a follower of technical analysis and chart patterns,I noticed this Symmetrical Triangle Pattern.If a stock breakouts or breakdown from the converging trend lines,it is believed that it will continue to move in the respective direction.A target is generally equal to the width of triangle.This method is popularly known as "the measuring move" with respect to chart patterns analysis
Check the chart given below of Suzlon, as it broke down and made a Symmetrical Triangle Pattern.The measuring move target will be approximately -30 (minus 30) as the width of triangle is 100 and it broke down from 70 level.If it had broken the trend-line on the upside, the the target would have seemed possible,specially as we are in this bull trend.
Now -30 is impossible so we will swiftly do away with this chart pattern.But if we see a similar chart pattern in an intraday chart,we will trade it,and might trade it profitably.That reinforces our belief in chart patterns.
I have got nothing against chart patterns.I just want to highlight the psychological aspect of how we process the information which we get by charts as per our convenience.We bend the rules to prove our point.Just as I have done here!! Uploaded an obvious failed chart pattern out of so many successful chart patterns.But I want you to think about it's effectiveness when logically the target sounds possible......so will it work with some other stock, some other time ?
Related Post
Trying hard to convince my friends with "ridiculous analysis"
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