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In trading markets, two forces constantly replace each other, long and short. During trading, the prices always fluctuate daily, which will impact the flow of funds. The short position is an indication of weakness in the bearish forces. When this happens, it means the market is encircled by the bullish forces, and they will take charge of the market. When bullish forces reach a critical value, they will explode, and the market will continue to rise.
After some time, the bullish begins to weaken, and the short position reaches the critical value. When the number of short position holders gathered and exploded, the market continued to fall.
The K-line trend is basically divided into oscillation or climbing of the prices. No one guarantees that when the trend direction reverses or moves forward. The traders use various patterns to distinguish between these two forces.
Single-bottom and double-bottom
When the K line indicates multiple instances of price float in the bottom range and not moving upwards, it indicates that the bulls are gathering and accumulating. When they reach a certain threshold, they have certainly exploded, and a breakout will happen.
Single top and top bottom
When the K line made a number of single tops, double tops, multiple tops, and flat tops. It is the indication of short forces gatherers, and sooner or later the K line breaks and falls in the range of downward trend.
In summary, before starting trading, first learn about where the accumulation will happen. At the top or bottom and how many times it will occur. The gathering of bear forces is completed in the form of a multi-top, whereas the gathering of bull forces is in the form of a single bottom or multi-bottom.
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