The double doji formation is neither a bullish or bearish formation, but represents a condition in which the open and close for the first session are the same, followed by a second session in which the open and close are again the same.
The Doji hints us that the market is in a state of balance of powers: the buyers strength has run out but so is the sellers'. So this is a state of temporary calmness before a major move. This pattern is usually found when both sellers and buyers are exercising the same pressure.
Double doji refers to the equilibrium state in which buyers and sellers are. Thus, typically it can be interpreted as a sure signal that a trend reversal will occur.
Mark the boundaries of theses "double doji" for a confirmed breakout or breakdown.
9 comments:
i am stuck in banking nifty short at 10380. should i book loss/.
Good Evening Ilango Sir and Blog mates,
Trade Plan 14th Feb. 2012
Today market corrected to 5351 and reached the high of 5421. The labeling of movement from 5428 to current current level is given below as per the the chart.
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For Chart Refer my Blog
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From the above one could conclude Wave C is under progress from 5421. This implies
Wave A = 5428 - 5351 = 77
Wave B = 5351 - 5421 = 70
From the above Wave B is strong by retracing 90% and it may be a early indication that Wave C may not be a strong correction and it may correct either 62% of 100% of A and accordingly Wave C target may be 5373 or 5344.
CONCLUSION
Initiate long @ 5340 with Stop Loss Price of 5320. or Initiate short @ 5390 with Stop Loss Price of 5420.
NOTE
The assumed Wave 'F' can not consume more time than the the sum of time taken by previous three legs which are C, D and E and which comes around 38 Trading sessions and presently the 'F' leg completed around 30 trading sessions and this leave us to assume that the current up trend or side way movement can continue for the maximum of 8 more trading sessions. This also explains the reason why market is currently in side way movement and why the market has not cracked as expected. This analysis also can be correlated with FII investment and Options Open Interest Data. Since expiry is left with another 7 trading sessions, our trade plan will change as per the movement of market for current series. This 7 trading sessions are likely to be trying times for traders. Extreme caution is need of the hour.
Wish you Happy Trading.
Namaste Ilango Sir,
During this current up-move which has last well over 30
sessions now, there have been multiple false alarms of trend
reversal. At most, they have helped only in long unwinding
and any shorts created on those indicators have been gulped
up quickly by the Bulls.
Is it still worthy to depend on the Bears? I think unless the
Bears prove their presence by closing the Nifty below previous
day's low for two consecutive trading sessions, there is no point
in creating a short positions and hope that the market will
fall.
Calmness NO hinted budget storm !
Namaste Ilango Sir & Blogmates,
Too many days of rangebound trade, is it the lull before the storm; Option Analysis for 13-02-2012
Duplicated at Wordpress Site
Thanks & Regards,
Sanjay Kr Jaiswal
SO MAY BULLISH STANDS ... TIME TO FASTEN SEAT BELTS
EITHER FALL FROM HERE OR FORM 5556 .. WHEN :D
2 inside days - Hopefully we can enter on
the break side tomorrow.
time was 4th is completed in flat...5 days taken by 2nd and today its 5th day at 5400
so nifty will move upward from velantine day to journey in 5th wave.
Good morning Sir and to all Friends
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