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How to screen for patterns

Discussion in 'Technical Analysis' started by praveen2hearts, Oct 24, 2020.

  1. praveen2hearts

    praveen2hearts New Member

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    Dear shabbir

    I read your book and it is very informative and gave me a different perspective of technical analysis. My question is there are somany stocks and we cant go through all stocks.

    Is there any way to find a particular pattern is formed/about to form for a stock?
     
    praveen2hearts, Oct 24, 2020
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  2. shabbir

    shabbir Administrator Staff Member

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    The first step is to know the right stocks and you can do that by reading my following articles

    https://shabbir.in/investment-checklist/
    and
    https://shabbir.in/fundamental-analysis/

    Once the stock qualifies the above checklist and analysis, I analyze the business on the following parameters

    https://shabbir.in/business-checklist/

    Moreover, here are some investing rules to follow:

    https://shabbir.in/rules-investing/

    And then the ratio I use to evaluate the stock

    https://shabbir.in/value-stock-investing/

    Finally comes the understanding of technical analysis based on price action which gives us the right price.

    Don't try to go from the bottom of doing technical analysis on every stock. At least it doesn't work for me that way.
     
    shabbir, Oct 25, 2020
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  3. praveen2hearts

    praveen2hearts New Member

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    Thanks shabbir.
    Based on fundamentals I have selected few stocks and luckily bottom patterns formed for few of them. Then I will buy these stocks and after few days (lets assume 3 months) top patterns formed then should I book the profits and reinvest in the same stock when bottoms formed? Is it the right strategy??
     
    praveen2hearts, Oct 25, 2020
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  4. shabbir

    shabbir Administrator Staff Member

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    That may be a good strategy at the outset but I like to invest in small tranches in the bottom formation patterns. Then I wait for the stock to rally. I am not a big fan of booking profits early. So even if top formation is on, if I don't see any sign of business being bad, I like to remain invested. Even if top is formed, and there is an opportunity in the correction after the top, I re-invest.
     
    shabbir, Oct 25, 2020
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