How to Spot a Trend Reversal Before the Breakout | N Pattern Explained | Vijay Thakkar

Vijay Thakkar • 11 days ago

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What This Video Is About

This video discusses the 'N' reversal pattern, a rare pattern that appears in a downtrend and signifies a potential reversal. The pattern is characterized by a stock making a bottom, moving up, making a new bottom above the previous one, and finally making a new high.

Major Ideas Discussed

  • The 'N' pattern is a reversal pattern that occurs when a stock is in a downtrend, and its appearance is even more significant in such cases.
  • The pattern has specific characteristics, including a bottom, a move up, a new bottom above the previous one, and a new high.
  • HCL Tech is used as an example, where the stock has formed an 'N' pattern after correcting almost 50% from its all-time high.
  • To trade the 'N' pattern, one should wait for a breakout above the recent high, with a stop loss at the recent low.
  • Other reversal patterns, such as the inverse head and shoulder pattern in the Nifty IT index and the W pattern in TCS, are also discussed.
  • The importance of waiting for a breakout and confirmation before trading these patterns is emphasized.

What to Watch Next

Viewers are encouraged to monitor the IT sector, particularly stocks like HCL Tech and TCS, for potential breakouts and reversals. The Nifty IT index's inverse head and shoulder pattern is also worth watching for a potential significant reversal in the IT sector.