Generally used in stock trading
2006-08-12 02:07:48 · 4 answers · asked by qwerty 1 in Business & Finance ➔ Investing
If I understand the question correctly, one such signal would be a double top. That is where a stock rises to a particular price and falls back, then rises again to the previous price but does not rise above that previous price then begins to fall again. That is an indication the the trend has reversed. Another might be the price of the stock falling through the 50 day moving average. Another indication of a reversal. There are many others.
2006-08-12 03:05:14 · answer #1 · answered by Anonymous · 0⤊ 0⤋
Muncie has a handle on it. However I would not confine it to a Double Top, it might be a triple or quadriple (rare).
Also in charting its known as Stop And Reverse [SAR].
Within Japanese CandleStick Charting there are a numbe of formations which are by defination, Reversal Formations, and so grouped.
Since Trend Following as a Tactic is ALWAYS right during the trend, and ALWAYS WRONG at turns, recognizing turns [Junctures] in any auction market is very valuable, and there is an older book out there about recognizing junctures, by that same name, it might be helpful to read.
Have fun, do the homework, and good luck
2006-08-12 06:45:14 · answer #2 · answered by denaliguide2 3 · 0⤊ 0⤋
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2015-01-25 00:12:21 · answer #3 · answered by Anonymous · 0⤊ 0⤋
A contratrend signal is anything that indicates a trend is about to reverse. The first two answers are technical examples.
2006-08-12 08:31:23 · answer #4 · answered by STEVEN F 7 · 0⤊ 0⤋