What is the significance of chart analysis?

The purpose of chart analysis is to identify and evaluate price trends with the objective of profiting from the future movement of prices. They form patterns which reflect group behavior in the stock markets and provide insight on the direction the price is expected to take.

What is a pattern?

The movements that prices make as they zigzag their way along a chart form "patterns." Studies over many years show that these patterns tend to repeat themselves. Technical analysts look to this history of repeating patterns as having a predictive value. These patterns are then given names which roughly describe the shapes they draw on the charts.

What is the significance of these patterns?
A pattern gives the technical analyst clues on how to read the chart and, in turn, determine the movement of stock prices in the future. Hence enhances the predictive capability of the analyst.

When is the pattern information available?
The pattern recognition process is completed around midnight to ensure that the information is available before the open of the next day's trading.

Where is the pattern information available?
To know more about patterns, login to Equity section --> click on Charts -->click on Education.

Why do I see different patterns for a stock in the single day?
There can be various events which lead to the formation of various patterns during a single day.

How do I set alerts for my preferred scrips?
Alerts can be set by using "My Alerts" link under Recent Event Alerts. Further click on the "Set Alert" link to set alerts for your preferred stocks. To Set an alert you need to key in the following details:

Name : Specify a name for each set of alert criteria, making it easily recognizable among other alerts.

Instrument Type : Select the type of financial instrument to be examined from Securities or Indices

Symbol : Enter the symbol for the instrument for which you wish to set an alert for.

Symbol Lookup : Use the symbol lookup if you are unsure of the symbol that represents a particular stock.

Exchange : Select from BSE or NSE.

Industry : Set an alert for stocks within a particular industry such as Retail, Pharmaceuticals etc. This criteria only applies for securities.

Price : The search results can be restricted to instruments that closed at a specified price level. If an investor is only interested in stocks less than Rs 200, then entering "200 in the maximum price field would limit the search. Alternatively, if an investor is interested in trading higher-priced stocks, then entering "500" in the minimum price field would be a useful search criteria. The search is performed against close prices on the date of each event. This field does not reflect the current price of the instrument.

Volume : The search results can be restricted to instruments with a specified level of trading volume.

Opportunity Type : Allows you to select stock on a particular direction of possible price movement. The investor must restrict the search to one of these three types of opportunities.

Bullish : Bullish events suggest that the stock price will rise or is rising.

Bearish : Bearish events suggest that the price will fall or is falling.

Other : "Other" events are usually short-term patterns that mark the end of an uptrend or the end of a downtrend.

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