Pattern of "diamond", also known as "diamond" shape in the coordinate system of currency chart according to this rare and interesting. If the trader can promptly notice the appearance of this chart pattern, he gets a great chance to earn a tidy sum.
The name figure won by appearance, resembling a jewel. The model has a number of features and the right process to identify it provides a number of important nuances. Periods of time required for the formation of the "diamond" can be different. In this case, the longer forms "precious" pattern, the more reliable to use on Forex!
Most traders simply do not know how to use this graphical model and ignores his appearance on the screen. However, any gap in knowledge can not only select the potential profit, but to harm - leading to incorrect decisions and accept losses.
An important feature of the "diamond" is a place of formation. This model is a reversal pattern, so there is in most cases at the bottom of the market or at the peak of the upward trend. But in this case, without exception, without, unfortunately, will not work.
Beginning of the formation of a rare pattern occurs during a peculiar state of uncertainty in which the price of the currency. The figure combines two different types of triangle chart patterns. Expanding triangle (or formation) in conjunction with a rare form a symmetrical triangle graphic "diamond." The boundaries of the pattern in this case, will be performing all the trend lines that form it figures.
Trader may not even be aware of new developments, with the application of the laws and rules of working with the Forex graphical models allow to choose the best entry point into the market and take profits.
Trading in the middle of "diamond" absolutely contraindicated - in this expert opinions converge. Transactions are opened directly after the breakdown of the trend lines of the new-formed shapes.
Profitable to enter the market can be in the following situations:
• immediately after the breakdown of one of the lines of the figure;
• above the highest peak of "diamond";
• above the last peak formation;
• Immediately after the retest punched lines pattern.
Of the above situations options 1 and 4 of the most risky. Stop loss order should be placed directly below the low "brilliant", and take profit appropriate to put a height that does not exceed the height of the formed chart pattern, delayed from the point of breakdown figures. You can close the deal and partly by moving the position of the rest of a break-even level.
In the end we would like to recall the need to assess the feasibility of the transaction, even before you sparkles incredibly beautiful "diamond" form three days! If the rules of money management is not possible to characterize the operation as a profitable entry into the market within the risk tolerance of its better coolly ignored.