Technical Analysis

Rectangle tops are horizontal patterns drawn as parallel lines from comparable high and low-price positions. Prices lead up to the formation of the pattern, and they oscillate in a trading range over a short time. During this range, the prices move in a wavy or a W-shaped trendline with at least two high positions and two low price positions.  The trader can compare … [Read more...] about How to Use Rectangle Tops in Identifying Breakouts

Introduction The measured-move up (MMU) pattern is a 3-part formation in a stock chart where prices go up, then follow through a retracement before it proceeds to go up again. It describes a long-term bullish reversal. It is the opposite of the measured-move down that occurs as a long-term bearish reversal. The MMU formation begins first with a bullish reversal – then it … [Read more...] about Step-by-Step Guide to Using the Measured-Move up in a Bullish Reversal Pattern

Introduction A broadening bottom is a chart pattern formed by two divergent horn-shaped lines moving between horizontal and vertical directions. The shape forms a symmetrical triangle or a wedge that increases over time. They describe a short-term bullish reversal from a bearish trend. The price action of the stock opens outward after it begins forming the broadening … [Read more...] about Step-by-Step Guide to Trade the Broadening Bottoms

Stocks, currency, and commodity prices don't behave randomly or chaotically. Instead, they follow specific patterns that repeatedly occur, which experienced traders leverage to squeeze substantial profits in various marketplaces. The Elliott Wave is a perfect pattern analysis theory commonly used in technical analysis. The strategy is based on people’s psychology while … [Read more...] about Elliott Wave Theory: The Ideal Price Pattern Analysis Tool

Rectangle bottoms are formed by two horizontal trend lines that oscillate in a parallel direction. This pattern is formed after prices move in a downtrend before it pulls up a short-term bullish reversal in an upward breakout. The pattern can also indicate a downward bearish continuation in the short-term instead of the upward breakout. The difference with the rectangle tops is … [Read more...] about Rectangle Bottoms and How to Predict an Upward Breakout