8/9/2023 0 Comments Ta rising wedgeIf the price don't close below the confirmation point then it may not be a triple bottom pattern.One can often seen a pull back after a breakout which is in support of this pattern formation. Triple bottom is considered reliable only when the price closes below the neckline support or the confirmation point(lowest low of the pattern) and there is often high jump in volume. Breakout:It is very important for this pattern confirmation. The tip of the bottom may be from pointed to round shape and hence for the neckline also its not necessary to be horizontal, it can be sloping upwards or downwards. However practically the three lows are not necessarily of equal heights and spaced equally from each other. Shape: Theoretically the triple bottom should be symmetrical that means all the three bottoms should be of nearly equal heights and spaced almost equally from each other. The longer the duration the more reliable the pattern is, after the breakout occurs. Duration: It takes several minutes to several months for this pattern to be formed. After all this attempts sellers looses their faith and buyers took over sellers resulting in the rise in price and reverse in the trend. Same sentiments of sellers are involved in the formation of third bottom. Again the sellers tries to reduce the price but fails to get enough momentum to further decrease the price which results in a second pull back. Triple bottom chart pattern is formed when the sellers have faith that the stock price will go down further which leads to a new low (bottom1) but fails to continue so due to the support, results in a pull back. Understanding Triple Bottom Chart Pattern: It is always advisable to keep a stop loss in a pull back. However the important thing to note is the pull back is to test the neckline support which later becomes the resistance. If the price don't close below the confirmation point then it may not be a triple top pattern.One can often seen a pull back after a breakout which is in support of this pattern formation. Triple top is considered reliable only when the price closes below the neckline support or the confirmation point(lowest low of the pattern) and there is often high jump in volume. The tip of the top may be from pointed to round shape and hence for the neckline also its not necessary to be horizontal, it can be sloping upwards or downwards. However practically the three highs are not necessarily of equal heights and spaced equally from each other. Shape: Theoretically the triple top should be symmetrical that means all the three tops should be of nearly equal heights and spaced almost equally from each other. After all this attempts buyers looses their faith and sellers took over buyers resulting in the fall in price and reverse in the trend. Same sentiments of buyers are involved in the formation of third top. Again the buyers tries to rise the price but fails to get enough momentum to further increase the price result in a second pull back. Understanding Triple Top Chart Pattern:Triple top chart pattern is formed when the buyers have faith in the stock and take the price to a new high (Top1) but fails to continue so due to the resistance, results in a pull back.
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