Speak Stocks » chart pattern

Using Energy Fields To Predict Breakouts

Amey S — Mon, 29 Jun 2009 16:00:11 +0000

Energy fields? I am pretty sure most of you have never heard about energy fields being used with technical analysis, but it might be something you may take notice of more often now.

With the help of MarketClub, we were able to get this video analysis of gold together. Who knew that we would actually use this as more of a teaching tool.

This video is packed with some pretty interesting content…

Of course, I have already mentioned energy fields, which equivocates to little consolidation breakout patterns. This video also takes a look at the head and shoulder examples.

Take a second to watch this video and see how a professional breaks down gold and uses technical analysis to do it.

Watch video – Energy Fields

SNE Head Shoulder Example

Amey S — Fri, 20 Mar 2009 05:50:53 +0000

We have covered what the head and shoulder chart pattern looks like. Now lets see it play out. The following example is of Sony (SNE): LS = Left Shoulder, H – Head, RS – Right Shoulder.

The price target, which was the measurement from the head to the neckline, of about $4 played out perfectly. If we were playing this stock at the time, then we have waited for the stock to breakthrough the neckline after creating the peak of the right shoulder.

A break below the neck would either tell you that this stock is not a buy and stay away or you would short it using the $4 price target of $16. That neck than becomes a resistance.

Triple Top, Triple Bottom

Amey S — Sun, 30 Nov 2008 07:24:59 +0000

A complete breakdown of how to successfully use triple tops and triple bottoms to find trend reversals.

Official Terminology

Triple Top – 3 equal and successive highs followed by a break of support following the last high. A bearish pattern.

Triple Bottom – 3 equal and successive lows followed by a break of resistance following the last low. A bullish pattern.

Overall Concept

Whether we are examining a triple bottom or triple top, everything is pretty much the same except for the difference in sentiment each gives.

In a triple top, a reasonable price target is the length between the highs and support.

The triple top and bottom are not complete until a breaking of their respective support or resistance. In order to limit risk, it is best to wait till a breaking has occurred before executing any trades.

Concept in Action

The chart above shows exactly how triple top looks and reacts after the third high. A triple bottom would resemble exactly the opposite of this chart.

While all three highs in a set do not have to be exactly equal, the closer they are the better chance of seeing more accurate results.

Important Notes and Reminder

The pattern is not complete until breaking of support or resistance.
A good price target is the distance between the triple set and point of breakout.
A full triple top indicates a bearish sentiment; a full triple bottom indicates a bullish sentiment.