Archive for September, 2009

Candlestick Charts

By Ahmad A Hassam

Candlestick charts are something that you need to understand as a trader whether you trade stocks, futures, options or forex. There are four different types of charts that you can use as a trader:

1) Bar Charts, 2) Point and Figure Charts, 3) Candlestick Charts & 4) Line Charts.

Line charts are the simplest. Point and Figure charts are used by technical traders to filter out noise or unimportant price movement. Bar charts and the candlestick charts have some similarities. However, candlestick charts are the best in my opinion. There are many traders now who have become the die hard fans of Japanese Candlestick Charts.

Candlesticks charts were developed by Japanese rice traders in the 16th century. They were used over the centuries by the Japanese rice traders and made some of them very rich. The best thing about candlestick charts is that they can show both the high and low price in the same candle along with the open and close. This helps the traders to know these prices with just a glance at the candlestick chart.

There are a number of candlestick patterns, some simple and other complex that are highly helpful in predicting the change in price action in the short term. These patterns are used by traders to predict trend reversals in the near term. These candlestick patterns coupled with other technical indicators can be a very powerful signaling tool in the hands of a trader.

Now why you need to learn candlestick charting? As I have said candlesticks are used in almost all types of trading like stocks, futures, options or currencies. Once you master candlestick charting, you can easily apply your knowledge in candlestick patterns in trading different markets.

There is a thinking that trading different markets is the only solution to the present stock market crash. Meaning that if the stock market has crashed, most probably the futures market or the commodities market may be booming. Don’t forget there is always a bull currency market. So start learning candlestick charts today!

Mr. Ahmad Hassam has done Masters from Harvard University. Download your free 82 page Candlestick Guide Now! Learn These Candlestick Patterns.

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Best Day Trading Advice

By Mon Ion

Truth be told. Anybody can be a day trader, but not everybody can be a successful day trader. Just like everything in life, to be successful you have to put in the time to learn the process, encounter problems, find ways to solve them and hone the skills you have developed so that the task becomes second nature to you. Any type of activity in which to learn it, you have to risk real money, not monopoly money, it is in your best interest to do all you need to, to practice and learn without risking any funds.

As you making live trades, learning and making mistakes so is your stack of money going down. If you are lucky, by the time the money is gone you would have learned one or two things. But, it’s a vicious cycle; you are out of money to horn the skills you have developed, so you have to start all over. You start to save money, by the time you have enough money to get back and start trading and learning from where you left off, you have forgotten the skills you have already acquired and the cycle repeats itself again.

However, there is a solution to this. It still will involve you doing some work; there are no easy roads to success. You will still have to learn the process of trading, all the terms, how to place trades, how to study market trends and use them to your advantage.

Basically it is the real deal, but you are not playing with your own money. This system will allow you to make mistakes, develop a strategy, learn from your mistakes, learn how to control your emotions, study stock trends to at least understand the effects on the price of shares in the market and be able to make a calculated guesses on which way the price of the stock you are monitoring might go.

There are certain rules you must follow to be a successful trader and they include:-

- Learning the process first before participating – knowing when to quit – Not borrowing money to trade with. It sucks when you lose money and it’s really a pain when you have to pay it back – Never risk it all to make up for earlier losses – Do not act on wims and gut feelings – Have a strategy and stick to it no matter what the market is doing

Becoming good in any activity golf, swimming, basketball, surgery, stock trading, being a ladies man too, involves practice practice practice. You will be amazed at how much time professional athletes at the top of their game practice daily to be able to remain where they are. That should give you an idea of how much work you need to put in to safe guard your money first and then make a profit and a living out of day trading. Practice makes perfect.

To learn more on how to horn your skills in day trading for FREE without risking your money and preparing yourself for huge profits visit us at http://www.daytradingspy.com/daytradingsimulator.html

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3 Basic Money Management Strategies

Author: Taro Hideyoshi

Psychology, trading tactics, and money management are the three essential skills for successful trading. These skills can be learned, but most traders tend to overlook the money management skills in trading.

A good way to start learning the skills of money management is getting to know the three basic strategies to managing trading money.

The 3 basic Money Management Strategies.

1. Constant Investing System

The Constant Investing system needs to define a fixed amount of each trade at the beginning. Then traders must open each position with the same amount of money. The sequence of profit or loss in trading does not matter.

2. Martingale System

The Martingale system is well-known as a betting system. The main idea behind this system is that statistically gamblers cannot lose all the time. Therefore when gamblers lose in a gamble, they should increase the amount of money by 2 times in their next gamble to cover their loss in the last gamble.

This type of strategies guarantees 100% profit if traders or gamblers have enough amount of money to cover their string of loss. If not, this system will destroy their portfolio.

3. Anti-Martingale System

As its name, the Anti-Martingale System is opposite with the Martingale strategy. While the Martingale will increase the amount of investment when traders get loss (smaller portfolios), the Anti-Martingale System will accept greater risks by increasing amount of trading during periods of expansive growth (larger portfolios).

These are 3 basic types of strategies in Money Management. There are still lots of Money Management Strategies out there. Find the systems that best suit to your trading styles.

Taro is an experience trader who trades in stocks, futures, forex. He strongly focuses on technical analysis, trading systems and money management.

If you would like to find more articles on MetaStock Tutorials, MetaStock Formulas, Trading Systems and Money Management. Please go to MetaStock Trading System.

You would also find the recommended trading books, DVDs, software and tools at MetaStock Trading Store.

Article Source: ArticlesBase.com – 3 Basic Money Management Strategies