Category: Money tips Release Date: 2006-03-29
1. Morphological Analysis
The so-called finishing refers to the share price after a period of rapid changes, that is no longer move forward, but in a certain region within a narrow range of changes from top to bottom, and so on before the time is ripe to continue the previous trend. This trend is known as order form patterns.
Symmetrical triangle which consists of a series of price changes, whose fluctuation is gradually shrinking, that change each time the highest price, below the previous standard, while the lowest is higher than the previous standard, showing a compressed graphics, such as from stock price changes in the direction of horizontal field of view, its maximum downward slash, lower limit for the upward tilt line, short-term high and low points, respectively, in a straight line connecting together, we can form a very symmetrical triangles. Symmetrical triangle volume, because more and more minor changes in share price decline, and then when the stock price suddenly jump out of the triangle, the resulting larger volume.
2. Market implications
Symmetrical triangle is because the power of buyers and sellers in the price segment within the region are evenly matched, temporarily formed to achieve a state of equilibrium. Shares from the first a short-term highs, but they are quickly digested by the buyer to promote the recovery in prices; but the power to buy the market outlook is not much confidence, or feel a bit hesitant about the future, so could not pick-up in stock prices to the last high point has now been turned around once again declined. In the fall of the stage, investors are reluctant to be too cheap to sell cheap sale or prospects still have hope, so the pressure drop is not strong, the stock fell to a low not already picked up the previous low, buyers and sellers The wait of contention so that the small fluctuations in stock prices has been narrowing from top to bottom, forming a pattern of this.
Volume in the symmetrical triangle formation process in the steady decline reflects the market outlook, hesitant buyers and sellers on the sidelines, making the market being produced.
Under normal circumstances, symmetrical triangles are order forms, that is, the original trend of stock prices will continue to move. Only one significant breakthrough in mid-term stock price move before the sale can take appropriate action. If the stock price up broken resistance (with the volume must be large), is a short-term buy signal; the other hand if down below (below the break in a low volume), is a short-term sell signal.
Symmetrical triangular measuring method is the least increase in break up when the stock price when the first one up from the forms began to draw a high point and the bottom line of equality, we can expect share prices to rise to at least this line will encounter resistance. As for the rate of price increase will be to shape up before the start of the same angle. Therefore, we estimated from measurement of the unit for at least the price level increases and the required completion time. Form at least drop measuring method is the same.
3. Points to Note
(1) a symmetrical triangle formation, there must be a clear two short-term and short-term low appears high.
(2) changes in the more symmetrical triangle price close to its peak and has failed to break the line, its strength decreases, if too close to the peak of the breakthrough that failure. Usually in the bottom half or three quarters away from the triangle at a breakthrough will produce the most accurate movement.
(3) require large volume break up with a downward break would not necessarily be accompanied by a large volume.
It should be noted, if the symmetrical triangle broke down when a great volume, it may be a mistake to break the signal, the stock is not as much as the break down as the theory. If the stock tip of the triangle below, and the accompanying high turnover, the situation is particularly accurate; shares are down just one or two picked up very quickly after the transaction, and began a real bull market.
There are false break, we should keep redrawing the boundaries to form a new triangle.
(4) Although the majority of symmetrical triangles are order forms, although there are likely to rise or fall at the top of the city appear in the bottom of the city. According to statistics, approximately three quarters of the symmetrical triangle pattern is a housekeeping measure, and the remaining quarter-turn patterns belong to.
(5) symmetry triangle breakthrough may occur short-term move in the opposite direction (Fan Chou), rising high Fanchou ends connected to the shape formed lines, drop Fanchou were hampered by low form of lines connected to the Next, if the stock price is greater than the above mentioned Fanchou position, form a breakthrough may be incorrect.
