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"An individual who wants to succeed against the giants must develop patience and eliminate greed. Remember, your goal is to trade well, not to trade often." -Elder Alexander
"The logical flaw of Efficient Market theory is that it equates knowledge with action. People may have knowledge, but the emotional pull of the crowd often leads them to trade irrationally." -Elder Alexander
"A price shock plants the seeds of an uptrend's reversal. Even if the market recovers and reaches a new high, bulls feel more skittish and bears become bolder. This lack of cohesion in the dominant group and optimism among its opponents makes the uptrend ready to reverse. Several technical indicators identify tops by tracing a pattern called bearish divergence. It occurs when prices reach a new high but the indicator reaches a lower high than it did on a previous rally. Bearish divergences mark the best shorting opportunities." -Elder Alexander
"To make money trading, you do not need to forecast the future. You have to extract information from the market and find out whether bulls or bears are in control. You need to measure the strength of the dominant market group and decide how likely the current trend is to continue. You need to practice conservative money management aimed at long-term survival and profit accumulation. You must observe how your mind works and avoid slipping into fear or greed. A trader who does all of this will succeed more than any forecaster." -Elder Alexander
"Opening prices are set by amateurs, whose orders accumulate overnight and hit the market in the morning. Closing prices are largely set by market professionals, who trade throughout the day. If prices closed higher than they opened, then market professionals were probably more bullish than amateurs. If prices closed lower than they opened, then market professionals were probably more bearish than amateurs." -Elder Alexander
"True breakouts are confirmed by heavy volume, while false breakouts tend to have light volume. True Breakouts are confirmed when technical indicators reach new extreme heights or lows in the direction of the trend, while false breakouts are often marked by divergences between prices and indicators." -Elder Alexander
Chart Analysis: Trendlines: 1. Longer the timeframe, the more important the trendline 2. Longer the trendline, the more valid it is 3. The more contacts between prices and trendline, the more valid that line.