Thread by @Bjybnf

You can spend years searching for the ultimate trading edge.

Or you can read this: Take 5 mins out of your day to learn different setups for top and bottom formations.

A 50k technical course for free.

After accumulation or distribution at bottom or top has been completed, there is a
breakaway point. When you buy or sell stocks at this point, you make money very
quickly.

Different types of bottom formations :-

1⃣ Sharp bottom
2⃣ Double bottom
3⃣ Triple bottom
4⃣ Flat bottom
5⃣ Ascending
bottom

1⃣ SINGLE "V" OR SHARP BOTTOM :-

This formation can be a sharp, fast decline followed by a fast advance, or even a sow decline
followed by a quick rally from the bottom with no secondary reactions until it advances to
higher levels.

2⃣ "U" BOTTOM OR FLAT BOTTOM

It is a formation where a stock remains for 3 to 10 weeks or more in a narrow
trading range, making about the same top and bottom levels several times; then when it crosses
the intermediate tops, it has formed a "U" or flat bottom

and is at the breakaway point … a
safe place to buy.

4⃣"W" BOTTOM OR DOUBLE BOTTOM

When a stock declines and makes bottom; then rallies for 2 or 3 weeks or more; declines and
makes a bottom around the same level the second time;

then advances and crosses the previous
top, it has formed a "W" or double bottom. It is safe to buy when it crosses the top or middle
of the "W" … which is a BREAKAWAY POINT.

5⃣"W V" BOTTOM OR TRIPLE BOTTOM

This is a third higher bottom after a double bottom or three bottoms near the same level. It is
safe to buy when a stock has formed a "W" and a "V" on the side and crosses the second top of
the "W".

6⃣"W W" BOTTOM OR 4-BOTTOM FORMATION

This formation shows first, second, third and fourth bottoms. The safest point to buy is at the
BREAKAWAY POINT or when a stock crossed the middle point of the second "W".

Different types of "TOP FORMATIONS"

1⃣ Sharp top
2⃣ Flat top
3⃣ Double top
4⃣ Triple top
5⃣ Descending top

1⃣ SINGLE "A" OR SHARP TOPS

After a prolonged advance or at the end of a Bull Campaign, the averages or individual stocks
often make a single sharp top … advancing 17 to 26 weeks or more with only small reactions
lasting sometimes 10 days or two weeks ...

Then follows a sharp, quick decline. It is safe to
sell on a subsequent or secondary rally and safer to sell when it breaks the last leg of the "A"
or when it breaks the bottom of the first sharp decline.

2⃣ " π " TOP OR FLAT TOP

When the market makes several tops near the same level and the bottoms on reactions are near
the same level holding in a narrow trading range , it forms a top or flat top. It is safe
to sell short when it breaks under the series of weekly bottoms.

3⃣ "M" TOP OR DOUBLE TOP

When a stock or the averages reach top after a substantial advance; then react 3 to 7 weeks or
more and rally again to around the same top, an "M" or double top is formed.

Then, when it
declines and breaks under the low of the last reaction or under the middle of the "M", it is safe
to sell short.

5⃣ "M A" TOP OR TRIPLE TOP

This formation occurs when a stock or the averages make 3 tops near the same level or the 2nd
and 3rd tops are slightly lower. When these formations are made at tops after a long advance,
they are signals for a major decline.

The more time between tops, the stronger the indications
for a big decline. It is safe to sell when a stock breaks the last bottom or breaks the end of the
"M" and safer when it breaks the bottom of the "A" … which is the BREAKAWAY POINT.

6⃣ "M M" OR 4-TOP FORMATION

This formation occurs when a stock or the averages make 4 tops at the same level or slightly
lower. It is safest to sell short when a stock breaks the second point of the second "M" or the
low of the last reaction.

Therefore , in this thread, we have tried to understand different set ups for top and bottom formation.

I hope you all learn something new today. I post such threads every week.
Follow me for regular stock market learning.

#Gann #StockMarket #trading