How do I spot 'double tops or double bottoms', before they happen?
Anticipating is a double-edged sword!
You can anticipate support or resistance as the stock approaches the zone. If you're already in a trade we can use them as a profit target or stop loss.
If you're in a bullish trade then you'd have your (first) profit target below the double top resistance so you increase your chances of taking the profit. Likewise, if you're in a bearish trade you have your (first) profit target above the support of the double bottom.
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You mention about Profit Target of a 1:1, then for actual trading you taking a 1: less than ½ ratio. Therefore, it is more risk than reward ratio, How do you justify this of being conservative, won’t I be bankrupt too soon?
This is a common fallacy. Just because a trade seems to be imbalanced as to risk/reward, that's not actually the important thing - it just sounds good in marketing material and in seminars. But what does it actually mean? Nothing! The key is what ...
If you're in a trade that ends the day favourably and is in the neighbourhood of your 1st profit target, should you think about exiting the trade to ensure that you're not gapped out of it during the after-hours trading?
Yes, if you want to bag that first profit (if you're a bit nervous) then better to take it than having a restless night. Different traders have different tolerances for perceived risk and as you say, it is a swings and roundabouts game. However, if ...
How would we put in an order to close out 50% of our position with our broker?
The method to close half the position when first profit target is reached will depend on your broker's platform. Your broker will be best placed to advise on this. Typically you would place a stop/limit order to open, with a 'Bracket' order attached ...
Can you elaborate on the importance of support & resistance in terms of the present & the past.
Support and resistance are important as it gives an indication of potentially how profitable the trade may be. If you have these close to your entry price or first profit targets, there is a risk that the stock will not be able to break past the ...
What do you consider a "properly constructed breakout?"
What we mean by that is a breakout that is preceded by a flag pattern, consolidation, or a clear support (or resistance) area. The chart patter should be neat and tidy, and not regularly be subject to gapping or huge daily ranges. This should be ...