Traders and investors who adopt technical analysis typically use price charts to identify market behaviour. For that reason, before learning anything else, it is vital to understand the basics of each widely used chart (see figure 1.1 for a visual representation): A bar chart, often labelled OHLC chart, employs the use of bars, representing the … Continue reading Candlestick Patterns Every Trader Should Know
Technical analysis is an efficient technique used to study price movements of financial markets, with its findings forming a credible guide to future market direction. One of the most well-known chart patterns is the head and shoulders formation, boasting not only high profitability, but also distinct rules for its assembly. Although considered a high-probability pattern, … Continue reading Trading the Head and Shoulders Chart Pattern
Observing sharp moves form in the foreign exchange market followed by periods of consolidation is common viewing. The problem traders have, though, is deciphering whether the pause in market price is the beginnings of a reversal, or a pullback before proceeding on its initial course. A chart pattern that places a framework around this type … Continue reading Trading the Forex Market Using Bullish and Bearish Pennants
Successful traders always follow the line of least resistance – Jesse Livermore. While intricate trading strategies may impress, it’s unnecessary to succeed in the financial markets – keeping things simple is essential. Most trading systems have one thing in common: the trend. In retrospect, a trending market is easily recognised on a price chart. The … Continue reading Exploring the Power Behind Trend Line Studies in Forex
Developed by Scott Carney, the harmonic bat pattern, a variation of the Gartley harmonic pattern, is a 5-point retracement structure composed of Fibonacci measurements used to create a potential reversal zone, or PRZ.
