wildeazoscar refers to a chart showing a bullish head & shoulder in the Nifty, says "A bullish head and shoulder at the market top!! what does it indicate? i think we look for bearish reversals after a rally and bullish reversals after a fall.....please let me know if i am wrong."
The chart was for 60 minute Nifty. The time frame is different. In this smaller tme frame, the Nifty has seen a sharp decline from 4700 to 4200, therefore, the development of a bullish pattern after a decline is not surprising. There was a fall and then we had a bullish reversal pattern. While the larger time frame may see one bullish or bearish cycle, a lower time frame inside that cycle may actually see many bullish and bearish cycles. Day traders & swing traders should be aware fo these smaller cycles which are more relevant for their trading.
JSKservices says "Sir I was at the Inv Camp on Saturday. There you did mention that Inv H&S was confirmed. Actually the text books say that the confirmation comes when the prices move abt 1-3% from the neckline. In our "emotional" mkt 3% would be a good assumption for confirmation. Of course your note now is another great learning."
My Notes: Yes, Edwards and Maggie suggests a 3% move away from the neckline is confirmation of the pattern. But, we are looking at a 60 minute chart and the same percentage rules cannot apply on a lower time frame. 3% means almost 125 points, which is half way to he possible target! Then, how do we confirm? I simply take a close above the neckline. See, there is a trade-off between confirmation and early entry. Sometimes confirmation can be too late to enter.
men talks about 9 to 11 hour power cuts in Bangalore, the IT capital of India. In the last month, we had 4 to 6 hours of power cuts in Delhi with temperatures at 44 degreees C. The Ramcharitmanas says: "Whoever is king makes no difference to us. We will have the same days and the same nights."