Chart patterns play an essential role in our success.
They highlight the chief driver of all stocks and indexes -- fear and greed. They highlight the psychology of thousands of traders. Ignoring that can be costly.
One of the most commonly used technical indicators is relative strength (RSI). It’s simply a momentum oscillator that measures the speed and change of the price of a stock, an index, an ETF, even currency.
When it moves to or above its 70-line, we have an overbought condition. When it moves to or below its 30-line, we have an oversold condition. Simple enough.Read More
Admittedly, some technical patterns have bizarre names.
Spot them in time though, and you stand to do explosively well. One of those is the cup and handle – one of the oldest chart patterns you’ll find. It’s also one of the more reliable of technical indicators, too.Read More
Simplicity is always the key to success.
Sometimes, all it takes is drawing lines on a chart.
In fact, it helped us catch another one of gold’s most profitable moves.Read More
There are still traders that refuse to subscribe to technical analysis.
But after 20 years of using it, I can tell you from experience, it works beautifully.
In fact, it’s an important tool because it chronicles price trends.
By being away of those trends, you can better react to market changes and better manage your risk. It can also help you time your trade. And, if you can successfully time your trade, you become more disciplined and successful as a trader.
Gold never fails to deliver profits.
It doesn’t matter if you’re a bull or a bear, if you know what to look for you’ll make money up to 80% of the time. The best part – it’s insanely easy. While many folks run to gold only as a safe haven, smart investors jump in and out every time the herd overreacts to just about anything.Read More
Technical analysis has been discounted by a good number of traders.
They don’t believe that studying wiggles and lines on a chart can uncover much, if anything. Instead, they like to rely only on fundamental analysis and have numbers predict the potential future of their investments. And that’s fine if you want to wait years for an investment to pay off.Read More
It was an occurrence so rare, we hadn’t seen it in 24 years, we noted mid-May 2017.
The infamous fear gauge – the VIX – had fallen to an unusual low of less than 10 – something we hadn’t seen since December 1993. No one thought anything of it. Markets continued to run higher. And no one, it seems, was paying attention. But we were.
After 20 years of trading, I may think I’ve seen it all.
Then, some one surprises me with something so ridiculous even I’m left banging my head against the wall. The other day, an old friend told me he only uses relative strength (RSI) to tell him when to get in and out of trades.
“Just RSI,” he said. “I swear by it.”Read More
Since topping out at 103.81 in early 2017, the U.S. dollar has been nothing short of a slow-motion disaster. Things got so bad by May 2017 that the currency broke below the support line of the falling wedge pattern. Much of that may have been a result of Donald Trump’s weaker dollar policy, though as well as with political uncertainty.Read More
You can’t trade the news, they say.
“There’s no way to accurately gauge how a news event will play out in the markets, I don’t care what they say. Trading the news is an especially seductive trap for those who aren’t in tune with major stock market trends. They don’t realize that in most cases the market’s already baked the news “into the cake” by the time it’s reported.”Read More
“Everything should be made as simple as possible, but not simpler.”
That’s according to Albert Einstein.
Applied to trading, it simply tells us simplicity is key.
It was a rare occurrence we hadn’t seen in 24 years.
The infamous fear gauge – the VIX – fell to an unusual low of less than 10 in May 2017 – something that hasn’t happened since December 1993. In the single digits, the idea is that all is well. Calm as resumed. But it’s at these points when smart investors begin to worry.Read More
We all have a tendency to overthink just about everything.
We make things much harder than they really have to be. We’re all done it.
But let’s be honest. The simpler things are, the easier it is do just about anything, including making money. It’s the simple strategies that allow for the best results with less stress. In fact, many currency traders will only look at charts as a simplified way to identity patterns and opportunities, instead of being bogged down with the noise of the news.Read More
When it comes to pattern recognition on a chart, we could spend hours looking at daily, weekly, monthly, one-year and five-year chart.
We can examine every wiggle, every bounce, and every dip for hours.
In fact, look at the U.S. dollar.Read More
Since 2017 began, the Mexican Peso has been an absolute mess.
In fact, since January, it fell 16% from 22.
However, as you can see in this chart of the $USD-MXN, it sat at an extreme low at double-bottom support dating back to November 2016. Will support hold, or will the Peso continue to fall?Read More