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Consolidaton

Discussion in 'Technical Analysis' started by jignesh_acharya, Oct 3, 2014.

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  1. jignesh_acharya

    jignesh_acharya Active Member

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    Hi Shabbir

    How do you decide that particular stock will consolidate after the breakout?

    What will be the good time to buy when we observe the breakout in the particular stock? Is the consolidation phase is good time to buy after breakout?
     
    jignesh_acharya, Oct 3, 2014
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  2. shabbir

    shabbir Administrator Staff Member

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    Yes consolidation phase is good but if you are impatient, you can buy just after the breakout.
     
    shabbir, Oct 5, 2014
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  3. jignesh_acharya

    jignesh_acharya Active Member

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    But how do you predict consolidation will follow after breakout?
     
    jignesh_acharya, Oct 9, 2014
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  4. shabbir

    shabbir Administrator Staff Member

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    Just by sheer experience. It always happens but when is difficult to predict.
     
    shabbir, Oct 10, 2014
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  5. jignesh_acharya

    jignesh_acharya Active Member

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    I read in one book on technical analysis that after consolidation, it is not necessary that stock will retain its previous trend, it may go downwards after consolidation in spite of its previous trend upward ( I have not seen so far)
    What is your experience on this?
     
    jignesh_acharya, Nov 16, 2014
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  6. shabbir

    shabbir Administrator Staff Member

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    There is nothing that it cannot do that and there can be a trend reversal as well.
     
    shabbir, Nov 17, 2014
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  7. yankeedin

    yankeedin Responder

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    That is why stop loss is crucial on entering a trade
     
    yankeedin, Nov 17, 2014
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  8. MANGONI

    MANGONI New Member

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    dear sb,

    consolidation :

    for minimum 2 to 5 seasons range bound movement with a diff points of less than 10, say less than 0.4%

    am i correct

    pl explain in more details with any charts - a year

    tks
    mangoni
     
    MANGONI, Nov 18, 2014
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  9. shabbir

    shabbir Administrator Staff Member

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    Should not be a generic 2 to 5 sessions and it depends on the fall or rise that will decide how many sessions are needed for consolidations.

    I have explained the same in the eBook but if you want to know one more example let me know and can share it here only for you.
     
    shabbir, Nov 19, 2014
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  10. ravirajpr

    ravirajpr Responder

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    Just to add to this...after every breakout when momentum decreases mostly the price will be in a consolidation phase in a healthy trend. Though there is no hard and fast rule that after consolidation the trend should continue as this depends on price action.
     
    ravirajpr, Nov 24, 2014
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  11. shabbir

    shabbir Administrator Staff Member

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    Last edited: Jul 16, 2017
    shabbir, Nov 24, 2014
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  12. Suresh_Sinha

    Suresh_Sinha Active Member

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    Agreed
     
    Suresh_Sinha, Nov 27, 2014
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