Category: Money Tips Date: 2006-12-27
Morphological analysis, although of a long history of analysis tools, which measured the effectiveness of the city has many years often new. Movements were regarded as a classic of the "Technical Analysis of Stock Trends" published in 1948, the author of Robert Edwards and John Magee, for various kinds of forms, as well as the analysis method, have a very detailed explanation. In this article, the author through the analysis of shape theory, to try to make note of some parts of the analysis of trends as a reference tool.
Morphological analysis, based on K-line diagram analysis the trend of the stock, while the K-line diagram of course, is a kind of time and the price includes a chart: horizontal axis represents time, the vertical represents the price.
1, the price and type of pattern formation
Talking about the price patterns, we still have to figure out trends in the first movement of the concept. Do not think that most of the changes in trends in sudden, in fact, significant variation in the event prior to the trend usually requires a period of gestation time. The problem is that this gestation period does not always mean that the trend will be reversed, sometimes, this is only pre-existing trends in the rest, and then the original trend will continue.
Study of this gestation period and its predictive significance of the price patterns to be solved. So, what is the price patterns do? Price pattern is a stock or futures price chart for a particular pattern or patterns, they have predictive value, we can put them by category.
The price patterns, there are two main categories ---- persistent anti-transformation of form and shape. Anti-transformation form worthy of the name, which means the trend is currently undergoing major reversal; On the contrary, continue to shape that the market is likely to be only a temporary for a period of rest and recent overbought or oversold condition, some adjusted, after which, the existing the trend will continue to develop. The key is to be in the form of the process of the formation of a judge as early as possible in their respective types.
The most common major reversal patterns: head and shoulders shaped, triple top (bottom), double top (bottom), V word top (bottom), and circular (basin-shaped) top (bottom), etc. form. We will examine the prices of the change process, and changes the display on the chart, as well as determine their methods. Then, we have to look at alternative ---- two important factors associated volume form, and price patterns measured significance.
Trading volume patterns in all prices, have played an important role in verification. In the situation of unknown time (in many cases are like this), look at price data associated with the volume form is the current price patterns to determine the reliability of a decisive way.
The vast majority of the price patterns have their own specific measurement techniques to determine a minimum price target. Although the goal is simply the next step is to roughly estimate the market movement, but still help investors determine their compensation ---- risk profile.
Form another major class ---- persistent patterns, including triangular, flag and pennant-shaped, wedge-shaped, and rectangular. Such patterns often reflect the current trends are in a rest state, rather than the trend reversal, therefore, are often summarized as moderate or minor form, hardly the main form.
