Since childhood I always wondered what a doctor is looking for when he
1) flashes torch in your eyes
2) asks you to take you tongue out and say "AAaaa...!!"
3) puts his fingers on your pulse
4) listens to his stethoscope earphones
5) asks you to show your nails
6) glances at your x-ray
7) scrolls thru the zig-zag of ecg.....
I still don't know exactly, but one thing is sure - he is looking for symptoms......
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Technical Analysts are no less than doctors....of stocks....
What all do they look for in a stock graph?
Well, they too keep looking for symptoms - of rise, of fall, of continuity....
Every Technical Analyst, amateur or professional, looks for his/her preferred and favourite symptoms.
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What do I look for in graph?
I quickly look for the following 14 or so symptoms
- Spike bluffs
- Higher lows OR Lower Highs
- Step-up, step-down feet
- EMA 34/8 with priceline
- Baseline / Topline
- Outer circle bluff
- Gap-opening
- Bigger picture (5-day, 1month, 3month, 6month, 1yr, 5yr)
- Step down bluff
- Shadow of the bull/bear
- Ticking Volcanos
- BTST opportunity
- Support and Resistance levels, 20/50/200 SMA levels
- Wedges and triangle patterns
I look at these in a graph to spot only two things
"Oppotunities"
"Exit signal"
This list is open to revisions and improvement!
Every trader has his/her quick list of what all he/she is looking for in a graph!
With practice, you stop carrying the physical list, they get embedded in your eyes!
The symptoms automatically start popping up when you look at any graph!!!
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