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How to Identify Profitable Chart Patterns to Play
When you are learning to invest in the stock market, you soon find out that the stock market can supply you with a lot of stocks every day. Many of them profess to be stock market movers, hot stocks related to new technology from the health care, homeland defense, nanotech, biotech, voip, or internet sectors. |
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Most of them seem attractive, but the truth is that quite a few of these investing and trading opportunities might not be as profitable as you think. That's why it's important to learn how to invest in stocks the right way, especially if you plan to invest in them on a daily or weekly basis.
When you learn how to trade stocks the right way using the basics of stock market investing, you will hopefully be able to consistently pull money out of the markets in a short period of time.
You don't necessarily have to trade hot momentum stocks all the time. However, you can learn how to take advantage of them when you encounter the best opportunities for going long or for shorting them to make money when they are poised to fall down.
The truth is, leaning when to invest in stocks is not as important as learning how to invest in stocks. And how you invest in stocks should take into consideration what goals you are setting for that investment. For instance, are you investing for capital appreciation or for income through dividend paying stocks? Are your investments in the stock market for the combination of both capital appreciation and dividend income? Are you investing through a Mutual fund(s) or selecting your own individual stocks? Are you employing solid stock investing concepts?
Do you invest with a lump-sum dollar amount or dollar-cost average into your stock or Mutual fund positions (buying the same stock or Mutual fund at different prices over the years)? Is your investment dollar spread too thin and are all of those dollars working for your ROI (return on investment)? Do you pay commission fees to purchase a stock? Who do you use to help with investing?
Do you pay load fees in your Mutual funds? How large an amount does your Mutual fund charge you for 'hidden fees' such as management, operating, and marketing fees?
Learning how to invest in stocks is more important than when you invest in stocks and how you invest will determine your ROI.
A good stock market investing strategy incorporates a comprehensive a how-to plan that takes into consideration all of the factors above. Remember, every penny of your investment dollar should benefit you and your loved ones and no one else.
Market Direction:
A slow trending market. Although, the Dow has been more positive over the last three weeks with a healthy uptrend with the occassional pullbacks, than the NASDAQ. This is usually the time of year where the markets become more lethargic. People are off on vacation or at least not sitting in front of their computer screens as much with the nice weather outside. This is the type of market that makes identifying high profit patterns more beneficial. When there is not as much market directional pressure on individual stocks overall, being able to identify price patterns in individual stocks greatly enhances portfolio returns.
The signals themselves, reveal which stocks/sectors are getting buy or sell signals. That alone can identify where to have one's money, even in a lethargic market. But bigger potential profits can be derived from identifying high profit patterns. The patterns, along with the candlestick signals within those patterns, reveal longer trade set-ups. That longer trade set-up usually produces much bigger returns. But one of the criteria for having a longer-term pattern set up is that the markets in general are not whipsawing dramatically. That the market trend, although it be slow, will allow a pattern to establish.
As was demonstrated in the last newsletter titled best investment advice, the cradle pattern in the PLAY chart was revealing a high probability trade. The cradle pattern was demonstrating a bottoming action with a high probability of a bullish move. The longer term chart revealed a potential scoop pattern. Understanding the investor sentiment in creating both those patterns in combination allows the candlestick investor to take advantage of a high profit move.
PLAY
The Infosonics chart was another pattern setting up nicely, coming out of a Fry Pan Bottom formation. Getting into that position as the price was breaking out to the upside was also benefiting from the fact that the market trend in general was slow and steady even though the markets were not in a dramatic upsurge. The candlestick signals reveal when a chart pattern is performing in the manner into which expectations can be analyzed . Wouldn't you like to be able to visually identify where investor sentiment was performing in a pattern as expected and take advantage of those profit potential's. That is exactly what the candlestick signals provide.
IFON
The analysis of chart patterns is nothing more than identifying what has occurred with a high probability in the past. Utilizing the information conveyed in the individual candlestick signals and applying this to a trading pattern creates huge profit potential's. That same analysis applied to market trends in general increases the probabilities of being in a high profit pattern knowing that the market in general will not disturb that pattern. The Japanese Rice traders say let the market tell you what the market is doing. When you have that knowledge, participating in the high profit pattern trades creates a lower risk, high profit situation. Click here for the Advanced Pattern Analysis Package
The Dow closed right near the resistance level of the past two months. The next day or two will provide the same scenario as late last week, watching for candlestick signals at this resistance level. If prices continue higher, the obvious should be observed. The resistance level is not acting as resistance any more. Although the NASDAQ closed strong today, it is still trading in a relatively flat trading area. However this is not unusual for this time a year. As long as no severe selling takes place, the market should continue in a slow comfortable sideways trend. This would allow for making some good profits in specific sectors.
DOW
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Where can you learn all the small nuances of how to analyze markets and trends correctly? In a two-day training session with Steve Bigalow. His insights dramatically improves an investors perception of how to invest correctly. You do not have to learn formulas. You not have to know what fundamentals make stock prices move up or down. His easy-to-understand training process allows an investor can easily recognize the 12 major candlestick signals. This easy step-by-step process helps investors incorporate those high profit major signals into and understandable and functional profitable trading program.
You would not learn any investing concepts and truisms that you don't already know. What you will learn is how to apply profitable trading strategies that eliminate the emotions that occur when investing.
What you learn from a private training session will dramatically improve your investment performance for the rest of your life. For more information please e-mail us or call us.
Chart patterns for swing traders
Here are three profitable chart patterns that you can use the next time you are looking for entries into individual stocks. Wait! There is no holy grail. These patterns can and will fail. You must manage your money correctly to make them profitable!
T-30
This is the one chart pattern that I trade the most often. If you are new to trading stocks, then start with this pattern! It is easy to identify, easy to learn, and easy to trade. What more could you ask for?
Ghost Town
Some potentially explosive moves can result from trading this pattern. The best thing about this pattern is that you can usually get a low risk entry.
Swing Traps
What happens when swing traders and momentum traders get trapped in a stock and have to take a loss? The stock rallies
For this and more you can contact:
Technique
Trading Solutions Inc.
Email:
info@techniquetradingsolutions.com
http://www.techniquetradingsolutions.com/
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