Shopping in the rising and Sales in lowering trend in the majority of traders do not coincide with the rhythm of the market. Please note that we do not consider cases in which trade is created at the time of birth trend. Now we are talking about how they should behave within the trend. And for this situation are the best ways to enter the market based on the use of trend lines with the support or resistance, defined by the last completed movements. So, here are two the best point of allowing to enter the trade with a high probability of success at a relatively small proportion of risk in the market trend. In each of them assumed the use of limit orders, and only occasionally – the market if It has a good reason. Point 1.
Buying from the line of the uptrend in the third contact. An uptrend is defined as prices rise. We have an opportunity to draw a line with a slope up. She held on two consecutive rising grounds price bars with respect to the absolute bottom of at least two previous and two subsequent bars. The best time to enter the market occurs when third touch price trend line. At this point, of course, need to buy – and buy only (Fig. 1). Using this technique, you should inquire in advance of price levels, which may be different – depending on the addition, at what point will touch the price with the trend.
The Dow Theory was developed in the early twentieth century to assess the overall state of the economy, but in the future speculators took her into service for the market analysis. Dow Theory is composed of 6 ideas. Index takes into account everything. All information which is available to market participants immediately accounted for in share price. The market constantly, there are three trends. The first trend – global. It lasts for years. The second trend – the movement against the main trend, ie it correction, which may last several months.
The third kind of trend – a slight movement of the second trend. In this case, their direction may coincide with major market movement, and whether to be against him. Home trend has three phases. The first phase – a period of decline in the economy. The bulk of investors’ negative attitude to investment. Recommendations of brokers and experts – to sell. Stocks and other assets are very cheap.
During this period, most informed and far-sighted players are anxious to buy assets. The second phase is characterized by improved overall economy. Come into play, technical analysts, who noted a clear reversal trend. At the third phase has a peak in corporate profits, is the rapid growth of the economy. The general public begins to aggressively buy all types of assets. However, investors who bought in the first phase are gradually close their positions. It is worth adding that the market tended to remain investors buying on the first and second phases. the rest of the audience does not make big capital ilivovse loses a significant portion of their investment. Indices must confirm each other. This means that if the indices move in one direction, but in this case the market is a clear trend. Trend remains unchanged, there is no clear signal changing trends. Until all stock market indices do not show apparent reverse trend is unchanged. Volume must confirm the trend. Volumes should grow in the direction of the prevailing trend. Recall the third idea of the theory of the three phases of the trend. The volume will increase when the game will include all new members. Despite more than a century, Dow Theory does not lose its relevance in the present. As an example, look at the timetable for any action a large company and before you invest your money is to answer the question: what phase is now on the market?
The stops are being placed in the preset range with respect to most currencies, and number of operators who were short of the USD eventually profits. The book fell of the top night in the traded at 1.4232 to the 1.4080 area, while the pair EUR / GBP was around 0.9200. The Euro area recorded highs of 1.3072, however, the pair then fell to the area of 1.2980 to the close. It is understood that those who were long took profits recently. The estimated level of support in the 1.2880 area and stops are being placed on 1.3030, so that total volatility. If the pair fell several analysts see a buying opportunity. USD / JPY in the area recorded maximum of 95.66, but later was around 98.00 for a short period, despite a firmer dollar.
The pair ended the day in the area of 98.20, however, it is estimated that if the stock market fell, the USD / JPY will be under great pressure in the short term. The performance of exporters Nipponese undoubtedly has an influence on the pair slightly. In my view, the assumed strength against the dollar begins to recede. With the sudden improvement in global stock markets, and with some apparent progress with respect to the treatment of other economic issues, several operators will be decided by selling dollars. Double Action is awaited for the next 24 hours, but with a tune bearish for the greenback. GBP / USD Resistance 3: 1.4350 Resistance 2: 1.4320 Resistance 1: 1.4250 New York: 1.4053 Support 1: 1.3860 Support 2: 1.3780 Support 3: 1.3720 CFDs The pair maintained the maximum earnings taken and recorded at night, the stops are being installed in 1.4050.
It tested the level of support. The stops are placed at established ranges. A long-term resistance level is estimated at 1.5000, but the stops are placed above that level. It follows a two-way trade, so it is estimated that more operators are putting short positions. Tuesday: All times EASTERN (-4 GMT) 5:30 a.m. GBP DCLG HPI y / y 4:10 pm BCI King talk EURO GBP / USD Resistance 3: 1.3100 Resistance 2: 1.3080 Resistance 1: 1.3050 New York: 1.2985 Support 1: 1.2850 Support 2 : 1.2720 Support 3: 1.2680 Comments The pair continued to pound two-way, maintaining the level of support on 1.2880. The upper stops in the 1.2950 fired. Several operators in the area bought weight of 1.3000. Aggressive traders can settle in the area of 1.3000. It looks a trade two-way with great volatility. Tuesday: All times EASTERN (-4 GMT) 6:00 a.m. EUR ZEW Economic Sentiment 6:00 a.m. EUR German ZEW Economic Sentiment 3:15 pm EUR ECB’s Trichet will speak Join us for the Afternoon U.S.
The Euro also came under pressure when unfavorable news was announced. the German GDP revised down, and several traders sold euros. The Euro area recorded highs of 1.2831, and the lowest in the area of 1.2663 at the end of European trading session, both pairs, the EUR, and GBP, were within established ranges, so that understand that yesterday’s gains will not continue to the end of the week. USD / JPY also came under pressure, several exporters sold the pair in the 98.00 area, the maximum recorded JPY in the area of 98.10 after yesterday’s gains. The pair recorded in New York minimum area of 96.25 in the morning. On the other hand, the USD / CHF remained strong, with peaks not captured two years ago in the evening session, recorded maximum in the area of 1.1919, 1.1839 and minimum in what was a quiet session, compared with the other pairs. The stock market will be in the spotlight this morning, the DJIA is maintained with some downward trend. In my view, the USD will remain a safe haven because of fears over the global financial crisis, the issue of liquidity is still the central issue, and once this happens, Americans will produce the basic data a drop in the greenback.
The G-20 meeting scheduled for the weekend, you might add a pick to the majors next week. It is expected volatility before the publication of the events scheduled. This alert. The pair was on the rise, and then reverse the trend.