Forex Trading Signal 22 March 2017

Faced with this Crude Oil Inventories (USD) news release on 21.00 pm tonight, the market expects an increase from the previous figure. While in the previous release of Crude Oil Inventories figure or crude oil reserves exist in the position of minus 0.2m, this time the market predicts that the COI will be 1.9M.

Trader should be careful because this is a fundamental indicator which can be positive but also at the same time can have a negative impact. There is no consistent effect – it is possible implications for inflation or growth. Another thing to note is although this is a US indicator, but is influenced by the energy sector in Canada.

Another fundamental news that should be observed is the Existing Home Sales (USD). The Existing Home Sales properties seems not indicating high impact issue to the forex market, but it is important also to be taken into consideration in the analysis.

Free Forex Signal
For traders who need it, I gave the signal for free to you (the effective trading time on Monday (3/22/2017) at 09.00 until Tuesday (7/23/2017) morning at 03.00 GMT + 7):

GBP/USD
Buy Stop : 1.2496
Sell Stop : 1.2454

EUR/USD
Buy Stop : 1.0820
Sell Stop : 1.0787

AUD/USD
Buy Stop : 0.7671
Sell Stop : 0.7650

USD/CHF
Buy Stop : 0.9951
Sell Stop : 0.9929

Trading Signal 20 March 2017

Trading Signal 20 March 2017

We dont expect quite much movement on the trading floor.

Earlier this week the activity triggers the movement of foreign exchange is not too much. According to the forex calendar, news which is expected by traders can have a significant impact is the Monetary Policy Meeting Minutes (AUD). In addition, some news is expected to make an impact with a medium degree is Wholesale Sales m / m (CAD), German Buba President Weidmann Speaks (EUR), FOMC Member Evans Speaks (USD), MPC Member Haldane Speaks (GBP), President Trump Speaks (USD), and news releases HPI q / q (AUD). Trump’s speech seems worth the wait. Still remember the effects of Trump’s speech some time ago against the movement of the dollar and the euro?

Here are the free signals to you (the effective trading time on Monday (3/20/2017) at 09.00 until Tuesday (7/21/2017) morning at 03.00 GMT + 7):

GBP/USD
Buy Stop : 1.2406
Sell Stop : 1.2372

EUR/USD
Buy Stop : 1.0765
Sell Stop : 1.0727

AUD/USD
Buy Stop : 0.7724
Sell Stop : 0.7686

USD/CHF
Buy Stop : 0.9984
Sell Stop : 0.9960

Forex Risk Management, The Introductory

We are here attacking the first lesson of what we call “the work of the trader”, ie everything that does not strictly concern the analysis … If you ask yourself what trading can ask for as competence to apart from the analysis, you are in the right place.

What is risk management?
Risk management, also known as money management, refers to a set of rules and principles that will allow you to maximize the efficiency of your operations, and avoid taking too many risks, or at least risks that are not mastered.

For some people, these principles will seem obvious. However, keep in mind that when you really invest your money, you do not think so lucidly. We are won by stress, fear, and hope , which can sometimes “pollute” our ability to make rational and effective decisions.

This is where risk management comes in.

In fact, by setting strict rules in advance , we manage to overcome the difficulties caused by emotions such as fear or hope, two of your greatest enemies when it comes to trading on Forex.

Risk management is a somewhat tidy concept, so we are going to teach you here the most indispensable notions, the ones you will need directly at the beginning of your trading career.

Managing your capital

Main rule: do not use too much of your capital

Here, the notion of available margin is paramount. As a reminder, the margin available is the amount on which you can intervene, taking into account the leverage effect. For example, if you made a deposit of $ 1,000 on your account and you use a leverage of 100, your available margin is $ 100,000.

However, you should never use too much of your available margin, be wary of the leverage allowed.

For example, in the previous case, if you take a big position relative to your capital, for example on 50000 units, each variation of 1 pip will represent 5 dollars.

So, with 100 pips in the opposite direction of your position, you are already losing $ 500, which is half of your capital .

And once you reach 200 lost pips, your capital has gone up, and you’re going through what’s called a “margin call,” which means that the broker automatically cuts your position and your account is at zero …

There are no precise rules to know what proportion of its available margin should be used, but in the present case (deposit of $ 1000, leverage of 100), it seems advisable to limit oneself to positions of 10,000 units, where the value of the pip is 1 dollar over EUR / USD.

By prudently using your capital, you will be able to cope in the event of a transient change to your position. You will be able to hold the position until the trend becomes favorable again (if you have good reason to think that your position is always wise and you have simply made a timing error).

To conclude, do not be too greedy . Admittedly, the bigger the position, the faster and faster the gains, but we must not forget that it also works with the losses!

Pay patiently for gains on reasonable positions, increase your capital, then increase the size of your positions, this is the best way to be sure to last in trading.

Risk management of positions with stops and limits

We have previously learned to manage our capital, now learn how to manage our positions. In this field, the notions of Stops and Limits are paramount. Let’s start with the definitions:

Stop: We call stop the limit of maximum latent loss that is fixed. This is the threshold from which we consider that we were wrong in our position, and that our analysis is false.

That is, we cut our positions as soon as the stop is reached. For example, you buy EUR / USD at 1.3060: If your stop is 10 pips, you will set it at 1.3050, and cut your position at this price.

Limit: A limit is the opposite of a stop. This is the goal of gain that we set. This is the threshold from which we consider that it is wiser to cash out your winnings than to hold the position. Specifically, with a limit of 10 pips, if you buy EUR / USD at 1.3060, you will sell at 1.3070.

Stops and limits can be defined “orally” or automatically , which we recommend.

You can automatically place stop and limit orders on your platforms, so that positions are automatically closed if they have reached the stop or limit.

The usefulness of stops and limits
The interest is obvious in the case of stops: Avoid being caught in the game of “it’s good, it’ll go back” , because by doing so, you will drag long losing positions, which will undermine your margin and therefore your ability investment.

Our opinion is that if the courses go in the wrong direction, it is better to accept it and move on . Things move very quickly on the Forex, and it is better to accept to have been wrong than to wait for the courses back up and to let go of opportunities.

For limits, it will be to avoid being “too greedy” waiting too long before taking his winnings on a winning position. Many traders doing this have been surprised by the speed at which prices fall after a spike …

An old stock market adage says that trees never go up to heaven, and it is better to take profits early than to wait too long and face a brutal turnaround that will wipe out your winnings.

We strongly advise you to place your auto-stop stop and limit orders right after your position statement, and not to touch it anymore . Once the position is taken, we are not so lucid, and we may be tempted to disregard the rules we have set, which is usually a bad idea.

In addition, with automatic stops and limits, you will not have to monitor the position closely, which is more comfortable.

How to choose stops and limits?

Firstly, we must know that the more we invest in the short term, the more our stops and limits will have to be tight. Then everything depends on your strategy, everything depends on the risks you want to take …

However, it will be necessary to ensure that your limits are always wider than your stops.

Your winning positions must earn you more than you lose your losing positions.

But this principle alone is not enough to properly position its stops and its limits. Indeed, the risk management intervenes in the choice of the levels on which one will set its stops and its limits, but the analysis also intervenes.

Conclusion

To conclude, risk management aims to help you overcome psychological errors, mistakes that can lead you to make your emotions. But for that, it is also essential to know each other well, to know the psychological biases that the trader is often subjected to: This is the subject of the following lesson.

Best Moving Average Settings for Daily Trading

Moving-average (MA) are traditional indicator that are commonly used by traders, both beginner traders as well as skilled and professional traders. Its usability and brilliant capacity to peruse (detect) long-term trends make the MA as the first known indicator of novice traders. There are numerous variants of the MA created by experts. Starting from as simplest as average of certain candle periods to the most complicated formula that consider a specific level of significant value.

MA’s are considered as a lagging indicator. Considering this, many people are competing to refine the basic formula by entering new parameters. Until now, there have been no fewer than 45 types of MAs with various variations.

Enough with all the background regarding the MA. Now the most important thing is, how to set the best MA so that we can get optimal profit.

The basic concept in setting up a Moving Average

Once again we must remember that MA is an indicator that recognizes ongoing trends. With this premise, we know that trends are very closely related to time. Trends in the past week can be very different from the current trend in the past month. Especially compared to the past six months, the last year, the last five years, even the last 10 years. It is possible that in the last one year the price of a commodity or currency pair is in a downtrend, in contrast to the condition of the past week where prices are continuing to move up.

Based on this, then in using a MA we must consider a minimum of three periods which are our references, namely short, medium and long periods. As a variation, maybe you can also use two short periods and one long period. Which is better than both? I would suggest the first one more. Why? Using two short periods may be good at determining your entry point, but you lose a period between short and long periods. You will lose a connecting bridge that illustrates the correlation between short-term movements with long-term trends. This is very dangerous for your trading, especially if you are a beginner trader.

So, whether you use a combination of daily-weekly-monthly or monthly-quarter-semester or even quarterly periods, I still recommend that you always use a combination of three short-medium-long MAs.

Recommended period numbers

The MA period which is usually recommended by default is 14. Beginner traders usually do not understand where these numbers are obtained. This is given as it is, and is usually used for granted. Some will add or reduce it, but how much is needed, nobody knows. Each changes it as they wish. Here I will explain how I determine the number.

I am a daily trader. You certainly know the intent of the daily trader I mean here. Yes, I make transactions with an average of no more than one day open and close. So, I use the daily trend period compared to the weekly trend with a monthly long-term trend reference.

As a daily trader, I used to use the 1H timeframe for my trading. Sometimes I jump to M15, but I don’t do it too often. Sometimes I also see H4 as a consideration, but I very rarely trade on this timeframe.

So, I will suggest period numbers for daily traders. Can these numbers be used by long-term traders or vice versa the scalper? It could be, of course with a little adjustment.

Basically I divide the trend period with the timeframe I use. This is the period number key that I use. For example, if I want to map the daily MA period on the 1H timeframe, I use number 24. This number is obtained from how many 1-hour candles are produced in 1 day. I use the same method if I want to describe the weekly trend in the 1H timeframe. The formula that I use is the number of candles in a day multiplied by 5 days (active trading days in a week) equivalent to 120. Next, to get an overview of monthly trends, the multiplier that I use is an active day of trading in one month equal to 480. (Note: the number of active trading days in one month varies between 20-22, so I am rounding to 20 days).

Thus, I have gotten an overview of trends in the short (daily), medium (weekly), and long (monthly) periods, namely 24, 120, and 480. It is easy right?

What about scalpers or swinger? You can adjust the period by considering the things in the Best MA Setting for Scalper and Best MA Settings for Swinger

What is the difference of Forex Brokerage from the Ordinary Money Changer?

Firstly, there is no very basic distinction between online currency exchange/trading and the ordinary money-changer. Generally, both entities benefit from the spread. Spread is the left amount after subtraction between the buy-sell prices. Spreads between various institutions may differ relying on company policy. However, basically this is how this business goes.

Forex has its leverage mechanism. The existence of leverage, among others, is the most point or way in which physical exchange of money at the public money changer and forex trading are not the same. The mechanism of leverage allows buyer-seller to make high volume transactions with small investments. Thus, high gains can be achieved even in small movements in the transaction parity. The highest leverage ratio allowed in most country is 1: 100, which means that the investor can make a transaction with 100.000 USD with a guarantee of 1,000 USD. Yet, sometimes there are small broker offer higher leverage to attract consumers. The highest leverage offered by broker until this article published is 1 : 3000.

Another contrast between money changer and foreign exchange (FX) market is that the last is a bi-directional market. In physical market, we can only sell if we have goods (in this case, physical money itself). It is barely possibly to sell no money to changer office. On the other way, in order to benefit from the rise of an opposite currency pair, we may also make a sale transaction to take advantage of the decline as we do the buying transaction. For example, USD / TRY: 2.9000 level and we think it will drop by selling a sales process, we start to make profit at the moment when the parity starts to fall below 2.9000. Taking the resident producers in Turkey get out of raw materials bought dollars at time t, t + x is the risk of falling dollar prices at the time. Because the raw material at a low price can be purchased at a high price. In order to hedge against this risk, Forex markets have a sales position in USD / TRY parity so that even if the dollar falls, it gains a profit and avoids risk and is called a hedge.

Forex can be invested not only on currency pairs, but also on commodity products and indices such as gold, oil, copper and silver.

One of the major advantages of the FX market is the possibility to process data instantly. Forex market is open for 5 days and 24 hours. Therefore, currency can be dealed almost all the time (except when holiday). There is no opening and closing hours such as money changer office. Forex traders, for example, are expected to see a change of prime minister, resignation etc. when there is an unexpected event during the night. they can instantly evaluate the data and gain a change in the parity.

Forex markets are not physical. The physical delivery in the purchase-sale transactions is not applied. Traders do not need to take the high quantity of money to the changer office for trading. One can perform transactions by sending orders via the internet whenever and wherever he/she wants. When the investor wants to sell, the buyer finds the opposite because forex is the world’s largest financial exchange-market where daily sum of exchange overreach USD 5 trillion.

Economic Indicator, Essential Classification

An economic indicator is a numerical number/figure that reflects a specific component of a financial action/activity of a sector or a nation. This measurement is freely distributed at regular interims by public or private statistical research institutions.

The Classification of Type

There are many economic indicators known in this field. However, this can be classified according to its importance and the impact they have to a business sector at the time of announcement. We recognize three classes of indicators as follows:

  • Leading/Advanced
  • Coincidental
  • Delayed

 

1 – Advanced

These data reflect the actual economic action at ahead of time. They make it conceivable to envision changes in economic trend.

They are hard to investigate since they envision economic movement. Combined with other data, they can or refute certain trends. For instance, a great consumer confidence index figure may suggest higher future consumption, however this trend will be affirmed or turned around with other lagged indicators.

 

2 – Coincidental

These are the most followed data release which assess the actual economic action at the time of announcement. These measurements/figures follow the economic activity as a whole. They permit at an offered minute to take the proportion of of economic activity. They are less complex to analyze than the advance/leading indicators.

 

3 – The delayed

These statistics are based on data already passed so more easily calculable. They measure past economic activity. These data confirm or refute an economic trend. Their publications have a direct impact on the market economy.

 

Every trader should know groups of economic indicators which in this case are included in fundamental analysis. By knowing this grouping, the trader can act appropriately in anticipating each release of certain economic news. Even for a technical trader, it doesn’t hurt to know this grouping so that it can help when he analyzes the currency chart.

How to Determine the Correct Settings for Your Stochastic Oscillator

I will be honest with you. I am a fan of Stochastic Oscillator. Although there is one stream of traders who say that Stoch-Osc is an outdated indicator, I still think that this is an interesting indicator. What reasons underlie my interest? For me, Stoch-Osc is one of the best indicators that can predict when prices will stop (either for a moment or so).

Some of my trader-friends don’t believe. They say that Stoch-Osc often gives false signals. I say, yes you can or otherwise, BIG NO. It all depends on how you determine the correct settings for your Stoch-Osc.

The first thing to understand… Definition?? Hmmm… yeah…likely.

First of all, where does the name Stochastic come from? Stochastic means that comes from chance and probabilities. Well, the chance is not very inviting for who wants to invest in the currency market, right?

For those who have done little probes, stochastic it reminds of things. A stochastic oscillation is a representation of the random variable evolution over time.

A large part of theoretical finance applied to the modeling of financial products (derivatives or not) is based on the study of stochastic oscillation since mathematicians and financiers try to describe the evolution of currency prices by a random walk.

The basic concept, “slow down before changes”

Stochastic oscillation of momentum composed of two curves. An oscillator, as its name suggests, oscillates between two values ​​or around an axis. Our Stoch-Osc is bounded between 0 and 100. This means that it cannot exceed these values.

The momentum is by analogy with physics and mechanical inertia. When the price of action is moving, depending on the strength of the movement, it takes time for it to change.

Its inventor, George Lane (1921 – 2004) was a futures trader in Chicago. This indicator is sometimes called (though rare) Lane’s stochastic. George Lane had observed that a projectile shot in the air, before turning to fall, must first slow down.

The Stoch-Osc, therefore, helps the trader to determine when the momentum of the currency market price turns around and this makes it possible to anticipate the price reversal.

It identifies the possible reversals by analyzing the position of the fence in relation to the range of the session.

How to use Stoch-Osc? Over-bought / over-sold

Usually, we draw two horizontal lines on the Stoch-Osc :

  • a line at 80
  • a line at 20

When Stoch-Osc is above 80 the title is said to be overbought. This means that the bulls have been the winners for some time and that the value has benefited from an increase during the last sessions.

When the Stoch-Osc has a value lower than 20 it is said over-sold. The currency suffered a decline due to bearish activity.

 

Examples of Stoch-Osc  Uses

Example 1

On the graph above I represented signals generated by Stoch-Osc. These are classic signals.

On the left, a strong correction ends with a lateral drift. The Stoch-Osc makes the rase motte. In this case, we expect it to come out of the 25’s (or 20’s – I put the horizontal lines at 25, 50 and 75).

We then have a range of trading range after a small rally in which a sell signal could have been an opportunity to lighten the position. It’s hard to say whether to settle the position or not. The correction was weak and we went to a low level. An indicator like the S-Filter let us see the strength of the trend.

However, Stoch-Osc, which is rising just below 50 after the weak correction, may prompt us to return again.

The chartist analysis also indicates a broken triangle at the top (end of April).

The period of the trading range is a blessing for the trader.

On the right, I think there is a bullish setup. The last sell signal is a small correction and the resistance is broken. This is a triangle from which one comes out at the top.

As we can see, the use of Stoch-Osc s does not dispense with the use of chartism or other indicators. The most classic is to use the MACD with Stoch-Osc.

 

Example 2

In (1) we did a short sale. The courses go down. We can ignore the purchase signals of the Stoch-Osc because the corrections are very small, a sign of a good downward trend.

In (2) we have a trading range that starts with a lateral drift. There we can exploit the signals.

The range support is finally broken down and we have a new bearish rally in (3). Note that in (1) and (3) Stoch-Osc remains stuck under 20%.

In (4) we have a new range. The indicator, however, is struggling to pass above 80, limiting opportunities to make gains. We will be careful in these cases.

Nevertheless, the range takes place in a low zone (after a good correction), so we will favor the long positions (we have a kind of cup not very clean: the courts are preparing to go up).

And we will have been right to do it. The resistance is broken. A bullish rally is started in (5). We will ignore sales signals. If we want to take profits on a part of the position they will give us the opportunity.

At the end of (5) the upward support is broken. This is where you have to close the position and/or take a short position.

 

Note: we could have averaged downward on the green arrows. It’s dangerous, but it pays when we are SAFE that we are not in a downtrend on the higher UT. But, I repeat, it is a dangerous game reserved for the craziest or most seasoned.

 

The trick is that all positions close positively as soon as prices rise a little. This involves the centroid of positions.

Four Steps Closer to A Success in Trading World

If you want to be successful on the foreign exchanges, you need a plan. Best of course, one of the works. The most important requirements are discipline and a high degree of honesty. The aim should not be quick money, but a long-term increase in capital. If security is paramount then more than just good market analysis is needed. It requires a well-thought-out money management. This guidebook shows what investors need to pay particular attention to and how to achieve much better returns with simple means.

To correctly assess risks
Investors should not sit out all the ups and downs of a currency. A major slump can throw the entire portfolio off balance for years to come. Even if it comes in the following years to strong profits, such a price slide can not always compensate.
High losses should therefore be avoided in any case. After all, a pair that drops by 30 percent needs a 43 percent recovery to make up for the loss. High fluctuations therefore become very expensive for the investor. Here comes an old market wisdom to bear: losses must be stopped and profits will continue to run. This applies to every single item contained in the account.

Stop courses with technical tools set
In the case of graphs, stocks , indices , commodities, or currencies, investors often notice particular price levels. At this point, the course changes direction very often. If these areas are undercut, this makes the chart technician eavesdropping. Because in this area many stop courses were placed. Investors sell when the price falls below this mark.

Use trailing stops
The trailing stop is an automatic, permanently traded stop loss order , as it is now offered by most banks. As soon as the value of an index or share rises, the trailing stop is also adjusted upwards. If the desired object sinks, the trailing stop remains unchanged until the index has reached a new high. If the currency price falls below the set line, the securities are sold immediately. The investor does not have to worry about anything. Thus, trailing stops are an important tool in money management.

Be sure to reduce risks
As already mentioned, it is very difficult to compensate for strong price falls. Therefore, in the context of money management, strong loss-makers in the deposit should be avoided at all costs. First of all, however, investors should be aware of the losses they will be able to get over financially throughout the portfolio. Do I become nervous even at a minus of ten percent or can I also take a minus of between 15 and 20 percent.
It should be noted that not every investment behaves the same way. With regard to the price fluctuations, there are clear differences. Therefore, it makes no sense to apply the loss limit established for the entire portfolio to each individual investment. It is better if the risk appetite of the individual parts is represented by their volume.

How to Trade the News — An Exact Method Every Trader Should Know

Let’s discuss “the news-trading”. This strategy refers to a trading method that only used near the news release.

There seems to be a lot of different ways that you could trade the news, name one of such, bracket trades. The plan is that you can look at the direction that goes and try to trade with it.

Yet, we have a completely different take on how to trade the news. We don’t think the right way to go is following the cows, following the herd as it goes up or as it goes down.

We believe there’s a smarter way to trade the news. So, what we want to show you is how to trade the news properly.

What we want to show you first is an exact way to:

1. Understand when news events are going to come out. There’s a few ways you can get this information, for this article instance, the Bloomberg economic calendar of December 13th, 2011 that we’re looking at and we can see that there is Retail Sales at 8:30 labeled by a red star. So, we use the economic calendar and look at only the red stars because these items right here are market movers.

These are the things that move the market and so we know that there’s a news event occurring ahead of time and we should be prepared for it.

What do we know about trading the news? Well we know that a news event comes out and particularly right before a news event, the market gets very slow. Therefore, we can expect the market to slow down or to tighten or the whipsaw. The channel can absolutely look at a smaller, tighter range occurring before the news, as traders wait for this special number to come out.

We shall wait for the news event to come out and do nothing.

So as you see it here this large red candle right here was the result of whatever economic news event occurred whether it was good news or bad news it doesn’t matter. This red candle is the result of whatever the report stated.

Now, this typically what happens: I do not know the future when a news event comes out; and it’s a red bar; a lot of traders say well this markets going to go down; I’m jumping in short.

Yet, really there is no known fact that a negative news report will result into a downward market or a guaranteed result that it a positive news event is going to result into the market going up. We really can’t base what we’re trading on that alone.

2. Now we relate to this candle as a chaotic candle based on a news event occurring and we look at it as if being red or green.

Since we concentrate them, trading price and price action, we’re not using any indicators whatsoever. That’s the beauty about the way we trade here. There are absolutely no indicators used. This particular method is only using price to dictate what we do moving forward.

3.Verify the candle; whether it is red/bearish or green/bullish.

In this case, simply it’s a red candle (look at the image) and therefore we’re not going short. We’re going long. We want to do the absolute opposite of this candle reaction to the news.

But we’re going to be smart about it. We’re going to do it with specifics objective rules and moving into the future. We want to have proof. We are going to let price prove that to me that we are going long.

4.Open an opposite direction after confirmation

So as the market starts moving into the future, you can see that traders that were short the market based on that news event are now having a little bit of a problem. They have to cover their shorts or get out at a stop or even reverse because the market is not moving in their favor.

Hence what occurs next is that the market explodes to the upside and the reason why you see this large green bar as a result of the traders who got in short initially based on the news event being wrong and having their stops hit or hitting that reverse button and initiating a huge move in the opposite direction.

Bottom Line

We’re entering long this market when two consecutive bars close on the opposite side of the highest high of the red bar (chaotic candle).

Note: if this was a reverse, if that candle was green that in that initial move of the market reaction to the news was green, We’d look to be doing the absolute opposite. We’re looking to go short when two consecutive bars close below the lowest low of that green bar.

So in this case, this happened to be a bullish move to the upside and it occurred because of that news event effect.

Now as you can see that the market exploded to the upside We think this is a very direct way to trade the news. It takes all the guessing out. It’s objective. It’s clean. We know why we’re entering and we have the proof.

 

Charting Strategy – Forex Strategy for Traders

One who decided to be a Forex trader need to be concerned with charting in order to invest in a good price. It is important to be extensively involved with the latest techniques in order to have a solid knowledge of when to invest in a security. The chart technique basically allows a good prediction to discover a corresponding course for themselves. Beginners use different brokers to get a good start into the charting technique. After all, a little background knowledge must be available, how to deal with the chart s and what signals must be respected.

The technical analysis
The technical analysis is an integral part of the financial markets. Since the beginning of the twentieth century, investors have tried to capture particular ratios of values and thus to ensure that good entry opportunities for trading are found. Extensive studies are used to clarify fundamental key figures of a market or a company and to use these for forecasts. Price progressions are statistics that lead to clear signals using the indicator analysis. The basic assumption of the charting technique is that the past price trajectories of the past are repeated. Professional traders have noted points in charts, which must be kept as special instructions in mind. Important methods in the charting technique must be taken into account in order to be able to continue to value the course. Especially the following point should never be forgotten.

The trend is your friend
The basic rule for the charting technique and the analysis of the technical data is the saying “The trend is your friend” . This proverb is used permanently in chart analysis to make it clear that you should not oppose a trend. Striking movements should not be strengthened in their opposition, as the same trend direction is usually maintained. If a stronger movement should be the case, it is a turning point, which is signaled prematurely. Different extreme points are marked in an analysis in order to recognize significant changes early on. If there is a series of trends with many highs, a downtrend can be detected. But alsoSideways trends are present when a course is on the same summit for a long time, making only light swinging movements. A straight line can then be introduced to the charts, which gives a clear indication of a sideways trend. Basically, charts can run in three directions:
1. up
2. Down
3. Sideways
These movements can be detected in the chart analysis with different tools. Mostly the Bollinger Bands used to ensure high, medium and low stock price marking. It is important that the different trends are clearly defined, thus ensuring that the trend has a longer validity. A trend is then present until it breaks through the price charts and can be seen below or above the curve. It is important that the outbreak only happens after use. Here it is sufficient that the course is noted once a day in order to detect possible changes. According to experts, the last markings should be carried out after the closing price. Other experts see a trend as completed only when the price is up to three percent below or above the trend line that has existed so far.

Highs and lows
When analyzing the current prices, the high and low points are usually considered a bit closer to define trend lines. When it comes to securing and fixing price targets for a stock, the highest and lowest points can be used as a good guideline. If a chart assumes a downward movement, then a low should be detected, which develops from the point upwards. The low usually uses a support. Courses can rotate frequently and develop against a trend line.Once the price has changed, it usually will not change again. Support in this context is stronger the more it has served as a turning point. This can be recognized directly, if the past of the current values continues to be looked at. In addition, the price history is often repeated, which is why chart analysis experts would like to look at the past history of the course to make forecasts. The analysis should not only look at the values of a course from the last hour, but it is also important to look at the values of the past few days. Depending on the forecast period, the last period should be considered closer to use similar values as support.
The specialist uses resistance as an important factor in the analysis of a chart, which can help in the analysis. For this purpose, a resistance line is drawn, which is used as an obstacle within an upward movement. In a long-term chart, a breakthrough can be well recognized . For future charts, it will usually be hard to skip a certain area permanently. However, if the break of the resistance line can happen, the drawn directive can be used as a support line. This swap is a secure methodology for chart analysis. It should be noted here:
• Like previous support, the uptrend line can turn into a resistance when it has broken down
• Resistance lines and downtrend lines serve as support for the course after a breakthrough

When is a trend over?
Most traders do not just need to know when a trend starts, but when it stops. It will be asked what indicators for this findingmust be used. Some formations that can be recognized in a chart confirm a trend reversal. This includes the V formation. This term comes because of the sudden potential trend reversal, which can lead to a rapid downward or upward movement. Countermovements seem to look like a V quickly, which is the case in a fast rise. On a descent or fall of the course an A-formation can be seen. Of course, for the trend change, a reliable use of important indicators should be used to quickly detect a possible reversal. In practice, the constellation in this formation is relatively common, so shareholders should be more concerned with the specificity of the formation.

The double bottom
The double bottom is an indication that the formation, which can also be considered the letter W, can be seen in the downtrend. Investors will recognize by the scheme that it is a rising pricewhen the W formation has been completed. The double bottom denotes the double top, where there are two lows, a short rising rebound and another low point. The course floor is not extremely blasted, but the ground is stable and remains in the almost identical values. After the medium recovery has taken place, again a decrease can be detected, which is then associated with a sudden slope. This formation is relatively common, but most will be seen in monthly views, not on individual days.