​Forecast reasonable trading goals: Analysis of interrupted pattern trends

In daily trading, in addition to predicting the trend trend by judging some important indicators, observing the morphological changes of the trend is also a very important analysis method in our technical analysis. Recognizing and understanding these patterns can provide traders with key signals to enter and exit the market. Today we will talk about one of the forms – the interrupted forms!

The relay pattern reflects the operational core of following the trend in market operations. Through the risk control capabilities of the relay pattern itself, traders can predict reasonable minimum goals within a limited risk range. This helps to achieve reasonable profit and loss ratio control. Combined with other analytical technical means, the success rate of transactions can be further improved.

Flag-shaped relay pattern

The flag-shaped relay pattern is one of the common relay patterns in market trends. Its typical adjustment phase is shown in a form similar to a flagpole.

Entry Signal

Flag-shaped relay in upward trend: provides two key entry opportunities:

A.When the price hits the lower edge of the flag for the second or more times.

B. After breaking through the upper edge of the flag, the price pulls back and touches the confirmation point of the upper edge again.

Stop Loss Settings

Based onDifferent fields are different, stop loss settings are also different:

If you select Class A method (enter the lower edge of the flag), the initial stop loss should be set below the lower edge of the flag to break down as the stop loss signal.

The minimum target test for flag relays can be visually measured by translating the parallel channel upwards equally, or setting initial targets based on the length of the “flag pole”.

Triangle relay pattern

The triangle relay pattern is further refined into symmetric triangles, rising triangles and descending triangles, each consisting of 5 sides and 6 vertices.

Entry Signal

Triangular relay provides two types of entry opportunities:

A. The last point of the triangle shape is the point “E”.

B. After the price breaks through the upper edge of the triangle, pull back and touches the confirmation point of the upper edge again.

Stop Loss Settings

Stop loss setting strategy:

The most effective stop loss position is usually set below the lowest point of the triangle “A”.

When the price breaks through the upper edge of the triangle, the stop loss can be raised below the “E” point to lock in profits.

Minimum target test: move up parallelly based on the lower edge of the triangle, visually measure the minimum target position, or refer to the “Flagpole” length setting.

Rectangular relay pattern

Compared with flag-shaped relay, the rectangular relay pattern appears as a rectangle parallel to the upper and lower, with no slope horizontally, and the support or resistance to the original trend is more significant, but the frequency of occurrence in the market is slightly lower.

Entry Signal

Rectangular relay also provides two entry opportunities:

A. The second or multiple touch points on the lower edge of the rectangle.

B. After breaking through the upper edge of the rectangle, the price pulls back and touches the confirmation point of the upper edge again.

Stop Loss Settings

Stop loss settings should be located below the lower edge of the rectangle and gradually move upward as the price rises to protect profits. For example, in an upward trend, when the price approaches the upper edge of the rectangle, the stop loss position should be raised accordingly.

The minimum target of the rectangular relay can also be estimated by moving up the parallel channel, or refer to the length of the “flag pole” as the preliminary target.

The most important way to use trend pattern analysis is to carefully determine the accuracy of the pattern during actual operation, so as to find a reasonable entry time, stop loss and target position. And the market trends cannot be like the textbooks every timeRhythm, this still requires investors to flexibly master and apply it in light of actual market conditions.