Ascending Triangles -Short Trading Strategy

By Jeff Cartridge

The ascending triangle can be traded on the short side entering the trade as the stock breaks out of the pattern to the downside. The pattern forms when the two boundary lines that contain the price movement converge to a point. The bottom line slopes up toward the top line which is horizontal.

Ascending Triangles Can Be Profitable Short

Most ascending triangles would be expected to break up and most of the time this is true, but 36% break out to the downside making it possible to trade on the short side. Just 44% of these breakouts are profitable and on average the profit per trade is only 0.31% over a period of 9 days. The ascending triangle is not one of the best chart patterns when it breaks to the downside, but applying some filters can make this pattern more attractive to trade.

Refine Your Entries

Short breakouts from ascending triangles work better in falling markets which is clear from the results that were achieved in 2000, 2002 and 2008. The best short trades occur at market turning points. The market and the stock should be in an up trend or consolidating, with the sector consolidating or falling for the best results when trading ascending triangles short.

A breakout from an ascending triangle is best if it occurs later in the pattern, in fact all the way to the point of the pattern is good, but not near the start. The best trades occur when a down side break occurs after the stock bounces off the lower boundary and drops back before hitting the upper boundary.

Ensure that the volume is supportive of the breakout, i.e. volume as the stock falls is greater than volume as the stock rises.

Ascending Triangles Profitable on the Short Side as Well

Following a series of simple rules to determine which ascending triangle to trade can improve results dramatically. By applying these filters ascending triangles are profitable on 52% of the trades and return an average of 1.07% per trade in 10 days. This is a profitable pattern to trade.

Note: Statistics for this article have been provided by Patterns Trader after analyzing over 60,000 chart patterns on the Australian market from 2000 - 2008. - 23218

About the Author:

Jeff Cartridge is a private trader and created the website LearnCFDs.com A Simple Timeless Method for Huge Gains

Defining the Better Form of FX Analysis

By Brad Morgan

Fundamental and technical analysis are the two main mechanisms used in the foreign exchange market.

1. Fundamental analysis takes into account economic, social and political elementsand how they affect the currency markets.

2. Technical analysis utilizes charts to find out trends and patterns in the change of prices.

Choosing one over the other is not obvious. A cursory surveying of foreign exchange trading related forums and websites show traders being staunch advocates of either one of these approaches. Those who choose technical analysis contest that graphs are the only style that can predict way ahead of time the trends which is important to making a profit in trading.

Conversely the proponents of fundamental analysis will defend that it is the economic factors that drive the changes in currency prices and this is unquestionably true, at least most of the time. From that spot they will justify that any patterns you might find on a chart are nothing more than coincidental.

But rationally this does not necessarily happen. Even though economic changes have a massive significance on the currency markets, it may still be possible to determine patterns in the way that the markets react after a new information or in times when there are no major information.

One forwarning for the technical analysis loyalists is that there is a probability that they will be caught unawares should interest rates suddenly change. If the trader does not read the news then there is a big probability that they will make a bad trading call. This can end up in a major trouble.

So the sum and substance is that there are economic happenings behind the larger scale rises and falls in the market, but there are also ordinary patterns that can be recognized in the short term. Discovering these patterns and trends, while keeping one eye on the economic and political news, is the best method to predict future price movements. And predicting future price movements, obviously, is the way to make money with currency trading.

Markets are sometimes delineated in terms of elasticity as they can move in either direction and fall back to their original or another position. The aspects that stretch the market are the fundamentals of socio-political and economic forces. How much it will stretch and where and when it will reach is the area of technical analysis.

Therefore you would be well advised not to be a loyalist in either form of analysis. Sizable returns are realized better when fundamental and technical analysis are combined together. - 23218

About the Author:

Forex trading requires understanding to be a successful forex trader. To trade forex effectively you must understand forex trading strategy to keep up with it all.

A Few Tips For Day Trading the Stock Market

By Jim Flecher

Day trading the stock exchange involves the rapid purchasing and selling of stocks on a day-to-day basis. This method is used to secure fast profits from the constant changes in stock values, minute to minute, second to second. It is rare a day trader will remain in a trade over the course of a night into the following day.

The main question that the majority ask when it comes to day trading is simple : 'is it necessary to sit at a PC PC watching the markets twenty four seven in order to be a successful day trader?'

The answer is no. It's not important to sit at a PC twenty four seven. There are a number of considerations, but typically the rule of day trading is to trade when everyone else is trading.

As with all financial investments, day trading is risky in reality, it's one of the riskiest forms of trading out there. The stock prices rise or fall according to the behaviour of the market, which is completely unpredictable.

If you are constrained by a small amount of capital, you may not be in a position to buy large amounts of a stock, but purchasing only a small amount can add to the danger of a loss. And, glaringly, it is not possible to forecast with certainty which stocks will end up in profits and which in losses.

It's also important to know that in day trading, it's the number of shares instead of the value of shares that should be the focus. If you day trade, you may face losses, but even for the costlier stocks, the loss should be debatable, because prices do not usually fluctuate to an acute degree over the course of only 1 day.

The day trading industry deals in a large variety of stocks and shares. Here are only a few : Growth-Buying Shares shares made of profit, which continue to grow in value . Eventually, these shares will start to decline in price, and an experienced trader can usually predict the future of this type of share.

Small Caps shares of firms which are on the increase and show no symptoms of stopping. Though these shares are generally inexpensive, they seem to be a very dodgy investment for day traders. You'd be safer to go with big caps and / or mid-caps, which are way more secure and stable thanks to a premium.

Unloved Stocks company stock which has not performed well during the past.

The best way to ascertain which kind of stock is best for you is to invest some time for careful research, a information understanding of market patterns, a solid technique, and a disciplined trading plan.

The secret to successful day trading is to be prepared. Know as much as practicable about the industry before you start essentially trading. You want to be taught how to trade ONLY when the market gives the right signals. - 23218

About the Author:

Find more on stocks to buy and 7 deadly trading mistakes.

Learn Secret Stock Market Trading Trick That Spits Out Money

By Lance Jepsen

The closing price is not equal to the opening price when it comes to trading in the stock market. You need to know that the closing price is much more important than the opening price. You are about to discover a little known truth that will have the stock market shooting out money like a broken ATM!

Let us just dive right into this.

The closing price reflects the final consensus of value for the day. This is the price most people look at when they get off work or when they print their daily charts at the end of the day. It is especially important in the futures markets, because the settlement of trading accounts depends on it.

Institutional and professional traders will trade throughout the day. Their behavior is as follows. At the opening, they take advantage of opening prices by selling high openings and buying low openings. They then close out of those positions as the trading day goes on. What they do day in and day out is to trade against market extremes, also called fading. They are betting on a return to normalcy in any given market. When a stock price reaches a new high and then buy side volume falls, they sell and push the market down. When a stock price reaches a new low and then sell side volume falls, they buy and push the market up.

The waves of buying and selling by amateurs that hit the market at the opening usually subside as the day goes on. Why? Most traders on the west coast have a day job they have to go to so they log-on in the morning before work, put on a trade, then check it when they get home. Even traders on the east coast will put on a position at market open while at work and then check it at the end of the day. Near the closing time the market is dominated by professional traders.

Knowing this is a huge advantage! Why? Because it means that closing prices reflect the opinions of professionals. Look at any chart, and you will see how often the opening and closing ticks are at the opposite ends of a price bar. This is because amateurs and professionals tend to be on the opposite sides of trades. You want to trade with the professionals, not against them.

You should consider closing out your long position if the stock you are trading opens and then goes up near its day's high but drops the rest of the day and closes near its day's low. What this tells you is that professionals are fading against your position and so you need to get out. - 23218

About the Author:

I hope you make a ton of cash in the stock market after studying this article. For more of Lance Jepsen's free trading secrets please visit stock market

Investment Trading Advice

By Mr Christopher Latterr

Many people these days have become quite enthusiastic to start investment trading. It is very wise to keep certain tips in mind before they actually begin. You should be always in touch with the latest industrial developments. You might notice that some sort of websites or some specific companies might be getting huge attention from all the corners of media. These could be very good to make an investment. You should never be scared to make an investment. You should remember the fact that more time you delay the more profit you would lose. You should look for newer trading alternatives like mobile trading, internet trading etc to save your time.

If you withdraw an investment you should be careful that the actual process is done before you start making a new investment. You should never invest in a company or a stock which is unknown to any one. If you want to invest you should collect as many details as possible about that company. If the details thus collected suit your investment trading priorities then you can go ahead. You should always rely on the trust worthy investment trading service. Other wise you would lose your money unnecessarily. Another benefit is good trading service provides you all the required market updates.

You would certainly have a better idea of the best investment options if you are aware of the worst options. One of the avoidable options is bank savings accounts. The profit margins are very minimal and you can never unleash the true potential of your money. Your investment trading should never involve insurance companies.

It is also advisable to avoid anything that deals with customers such as automobile companies, technology companies and retailers. It is also recommendable to avoid United States Treasury bonds and bills. The treasuries have now grown up greatly in value - that is the reason why they have a yield of 0%. And now the only way that they can go is down in the price. So make the effective use of these investment trading tips in setting your financial goals and to achieve the ultimate financial freedom.

The trading strategy can be performed by the trader either manually or automated by a computer. The manual investment trading technique requires a wide deal of discipline and skill. It is alluring for a trader to diverge from this strategy that frequently decreases its performance.

The automated investment trading strategy enfolds trading methods into mechanized order and implementation systems. Advanced modeling techniques by using a computer, joined with electronic access to the market world information and data, allow traders with a trading tactic to have distinctive market keyhole. This trading strategy can mechanize part or the entire investment portfolio. Trading models by using a computer can also be regulated for either aggressive or conservative trading styles.

If you are thinking of long term investment trading then you have to increase your portfolio i.e. invest in more and more areas. You should never fall to the false traps such as advertisements which claim "stock trades to gain 80 percent". They might be very less profitable and in some cases may lead you in to heavy losses. Your investment should always depend upon the factual details either acquired by you or some trust worthy sources. It is not always good to depend on the growth stocks. Some penny stocks with great growth potential can be very profitable for the long term.

The main thing which takes in to account with respect to stock trading is the investment trading strategies, which is the final result. Usually the maximum investors in the past have been correct only about 35% or 40% of time. However they cut the people who lost early and permit their victors ride. If it is well sufficient for that investor with some immense path records in past, it is well sufficient for one and it must be for everyone too. Maintaining a good history will keep us leading all time. - 23218

About the Author:

Learn more about Investment trading by visiting an archive of articles on this topic and other sources knitted closely to Investment trading.