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Showing posts from June, 2017

Trade moving averages like support and resistance areas

Q- Question from one of our students: "You mentioned that [moving averages act as magnets and] prices get attracted and tend to move close to simple or exponential moving averages. So if for example the chart is going up and the price is going down but is still above the moving average line, how low do you think it will get before it settles and then starts to go up? is there a way to predict it, or we just wait and see how traders make their individual decisions?" . A- Very good question. Moving averages are a very important indicator, worth learning. Please check out these two video where I show what moving averages are and how to use them . Unfortunately, there is no way to predict what price will do next. However, we can gather as much information as possible to stack the odds in our favor. In other words you want to have to increase the probability of success by recognizing key elements. Here is an example. Please take a look at the image below.

Q&A: Can I trade bitcoin (and other cryptocurrencies) using technical analysis

Q- Question from one of our students: "I want to trade cryptocurrencies (Bitcoin, Ethereum, Ripple and IOTA), and would like to know if the candlestick and technical patterns can be used to analyze and trade them correctly. Thank you!" A- Candlestick and technical patterns can be found and analyzed across all tradable equities (stocks, options, forex, commodities), including cryptocurrencies. Cryptocurrencies are a recent financial phenomena. Still considered an abstract and difficult concept to understand for most people, governments, banks, and corporations are well aware of its importance in the future of global economies and financial markets Despite their newness, cryptocurrency charts can be analyzed, just like any other trading securities, using traditional methods, such as candlestick analysis and technical analysis. Let take a look at a couple of examples here: Ethereum/Dollar Bitcoin/Dollar ETH/USD (Ethereum/Dollar) - Currently price 183.40

Which time frame to use for intraday trading analysis

One our subscribers recently asked us this question: "Which time frame do you prefer between the 5-minute and 15-minute candlestick pattern for intraday trading?" Here is our answer. When you find a stock that is moving, either gapping up, or running here is what to we recommend doing: Look at the daily chart to see what trend has been developing over the past 3 - 6 months. Consider entering if price has been in a consolidation and/or uptrend. Be caution if price has been in a downtrend. It might be just a bearish pullback. Then shift to smaller time frames depending on your trading strategy. DAY TRADERS Shift to 1-minute chart : See if there is a pattern development, such as flags, pennants, triangles. Identify the area of support/resistance and make sure price remains above support. Look at volume decrease during consolidation patterns. Enter at support, or after breakout. Exit at resistance, if supports fails, OR simply aro