Sunday, 3 February 2013

Reading Stock Charts

Reading charts is an art form that can take years to fully master.

Why do we read charts?

Because,by reading charts,we can determine what the "big money" is doing!

You have to be able to analyze a chart and come to a conclusion about whether or not

to risk your hard earned money on a trade.That is really the bottom line.

And this is what separates the novice trader from the professional.

There are several factors on a chart that make it worthy of trading.

By analyzing these factors,we can determine with high probability which direction a stock

will move.


Dr.Alexander Elder

A good signal jumps at you from the chart and grabs you by the face-you cant miss it!

It pays to wait for such signals instead of forcing trades when the market offers you none.

Amateurs look for challenges;

Professionals look for easy trades.

Losers get high from the action;

The Pros look for the best odds.

William J. O`Neil

History repeats itself in the stock market.

Many price patterns and price consolidation structures that stocks form are repeated

over and over again.

Edwin Lefevre

If a stock doesnt act right dont touch it;because being unable to tell precisely what is

wrong you cannot tell which way it is going.

No diagnosis,no prognosis.

No prognosis,no profit

Linda Bradford Raschke

Some of the best trades come when everyone gets very panicky.The crowd can often act

very stupidly in the markets.You can picture price fluctuations around an equilibrium level

as a rubber band being stretched- if it gets pulled too far,eventually it will snap back.

As a short-term trader,I try to wait until the rubber band is stretched to its extreme point.

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