Introduction
Charts
Technical Trading Strategy
Technical Trading Strategy
Technical analysts and traders believe that certain chart patterns and shapes are signals for profitable trading opportunities. Many professional and amateur traders claim that they consistently make trading profits by following those signals. In this chapter we introduce some types of chart patterns and the corresponding trading strategies, that, according to our extensive historical tests, give the trader an advantage.
"Triple Top/Bottom"
Triple Top/Bottom patterns, which appear frequently in trading, are relatively easier to detect. Below are some typical Triple Top/Bottom patterns:
 Figure 21. A bounce-back from an up-trend Triple Bottom is a buy signal. Risk involved is low. One can sell if it turns back and penetrates the line. |
 Figure 22(a). This is a Triple Top Breakout pattern with large volume, a buy signal. Risk is small because one can cover the sell out the position if the rate turns back down to the suggested cut loss level. |
 Figure 22(b). This is a Triple Bottom breakdown with large volume, a sell signal. Risk is small because one can cover the short position if the price turns back up to the line. |
 Figure 23. A bounce-back from Triple Top, a sell signal. |
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