Global Economic Intersection
Advertisement
  • Home
  • Economics
  • Finance
  • Politics
  • Investments
    • Invest in Amazon $250
  • Cryptocurrency
    • Best Bitcoin Accounts
    • Bitcoin Robot
      • Quantum AI
      • Bitcoin Era
      • Bitcoin Aussie System
      • Bitcoin Profit
      • Bitcoin Code
      • eKrona Cryptocurrency
      • Bitcoin Up
      • Bitcoin Prime
      • Yuan Pay Group
      • Immediate Profit
      • BitIQ
      • BitQH
      • Bitcoin Loophole
      • Crypto Boom
      • Bitcoin Treasure
      • Bitcoin Lucro
      • Bitcoin System
      • Oil Profit
      • The News Spy
      • Bitcoin Buyer
      • Bitcoin Inform
      • Immediate Edge
      • Bitcoin Evolution
      • Cryptohopper
      • Ethereum Trader
      • BitQL
      • Quantum Code
      • Bitcoin Revolution
      • British Trade Platform
      • British Bitcoin Profit
    • Bitcoin Reddit
    • Celebrities
      • Dr. Chris Brown Bitcoin
      • Teeka Tiwari Bitcoin
      • Russell Brand Bitcoin
      • Holly Willoughby Bitcoin
No Result
View All Result
  • Home
  • Economics
  • Finance
  • Politics
  • Investments
    • Invest in Amazon $250
  • Cryptocurrency
    • Best Bitcoin Accounts
    • Bitcoin Robot
      • Quantum AI
      • Bitcoin Era
      • Bitcoin Aussie System
      • Bitcoin Profit
      • Bitcoin Code
      • eKrona Cryptocurrency
      • Bitcoin Up
      • Bitcoin Prime
      • Yuan Pay Group
      • Immediate Profit
      • BitIQ
      • BitQH
      • Bitcoin Loophole
      • Crypto Boom
      • Bitcoin Treasure
      • Bitcoin Lucro
      • Bitcoin System
      • Oil Profit
      • The News Spy
      • Bitcoin Buyer
      • Bitcoin Inform
      • Immediate Edge
      • Bitcoin Evolution
      • Cryptohopper
      • Ethereum Trader
      • BitQL
      • Quantum Code
      • Bitcoin Revolution
      • British Trade Platform
      • British Bitcoin Profit
    • Bitcoin Reddit
    • Celebrities
      • Dr. Chris Brown Bitcoin
      • Teeka Tiwari Bitcoin
      • Russell Brand Bitcoin
      • Holly Willoughby Bitcoin
No Result
View All Result
Global Economic Intersection
No Result
View All Result

Trade in the Best Zones

admin by admin
October 4, 2013
in Uncategorized
0
0
SHARES
1
VIEWS
Share on FacebookShare on Twitter

Online Trading Academy Article of the Week

Are You Getting In Too Far Out On The Curve?

by Rick Wright, Online Trading Academy

Hello traders! As I write this week’s article I am enjoying the late stages of a hot Texas summer. We are still having highs in the mid-90′s (Fahrenheit), with most of us wishing fall and winter would hurry up and get here. I have several friends and relatives who live out in Colorado, and so far parts of that beautiful state have skipped fall and have already had snow. Welcome to winter!

colorado-snow-380x180

Looking at a few charts, I am drawn to a question that often comes up in our Online Trading Academy classes: Is it still too late to join this move?

An interesting analogy would be to look at buying clothing. Being late September as I write this, it wouldn’t make a lot of sense for me to go to clothing stores and shop for shorts and t-shirts for upcoming hot weather. It’s a bit late for that! Obviously, fall and/or winter clothing would be much more appropriate for this time of year. Buying shorts and t-shirts for the few remaining warm days would be similar to buying a currency pair after a long move to the upside-especially into a supply zone!

Take a look at the following chart.

20131001 fig 1

At the point labeled “1,” I’m sure numerous traders bought on the breakout past the most recent high. Looking at the chart, are prices expensive or cheap there? Obviously, expensive! We call this buying retail prices. The chart had been moving up for weeks, yet some traders thought it was going to continue moving up to the moon! Now take a look at point labeled “2.” This is the same, but the opposite. Many traders sold short the break below the most recent low, expecting a continued move to the downside. Selling to enter a trade after a longer term move to the downside, especially into a previous demand zone, are two of the mistakes that many new traders make. Selling way down there is selling very cheap – we call that a wholesale price. You probably wouldn’t go shopping for a whole new summer wardrobe with only a week’s worth of warm weather left would you? Why would you buy (or sell) something that already had a huge move in that same direction?

Actually, I know why. By now you’ve heard of the two main driving emotions in trading – fear and greed. Many new traders will buy after a long move up because they are too greedy; “If I don’t get into this trade now, I’ll never have a chance and it will go on without me forever!” Some may also see the emotion of fear in this trade. “If I’m not on this move, I’ll never make it as a trader, I have to make money now, it’s been going up and I must be on board or I will fail as a trader!”

There are numerous problems with those thoughts. The main is that your career is not defined by being in one trade (unless you are an over-leveraged hedge fund manager who has one lucky trade and you hang your hat on that trade for years. Which is a funny conversation in class!)

So how can we fix the problem of entering a trade too far “out on the curve”? One simple way is to break the chart up into horizontal sections. What I’ve done in the following chart is to use the Fibonacci Retracement tool, but customized the percentage lines. Using the major swing high in early February and the lows formed in April the chart has been broken into thirds. The top third can be considered retail prices, the bottom would be wholesale prices, and the middle is where we don’t enter trades, but just manage them.

20131001 fig 2

A few suggestions before you apply this to your charts. First, you must know what your time frame is to draw this breakdown on. If you are a short term daytrader, drawing in these sections on a daily chart would make no sense. In our classes we suggest watching at least two time frames if not three. I would draw this measurement on my highest time frame.

Second, it will take a little bit of practice to recognize the major swing highs and lows to draw from. It might be obvious to you by now that this technique is primarily designed for sideways markets. If you draw these sections on trending markets you will probably be waiting for many, many candles to happen before a trade presents itself!

Third, if you find yourself unhappy with breaking the chart into thirds, you could certainly try quarters. The bottom quarter would be wholesale, top quarter retails, and the middle half is only to manage a trade and not for entry.

Hopefully this technique will keep you from chasing too many trades, otherwise known as buying retail and selling wholesale!

Previous Post

Global Growth at 18-Month High

Next Post

Housing: Bubble Collapse Will Return

Related Posts

Madonna Joins Hands With Digital Artist “Beeple” To Launch New NFTs
Business

Madonna Joins Hands With Digital Artist “Beeple” To Launch New NFTs

by John Wanguba
May 18, 2022
Luna Foundation Sold 80,000 Bitcoin Amid UST Crash
Business

Luna Foundation Sold 80,000 Bitcoin Amid UST Crash

by John Wanguba
May 16, 2022
Bitcoin Network Strengthens As Mining Difficulty Reaches ATH Of 31.251T
Econ Intersect News

Bitcoin Network Strengthens As Mining Difficulty Reaches ATH Of 31.251T

by John Wanguba
May 15, 2022
Financial Giants Turn Attention To TikTok
Business

Financial Giants Turn Attention To TikTok

by John Wanguba
May 15, 2022
Santander Sends 80% Of IT Network To The Cloud
Business

Santander Sends 80% Of IT Network To The Cloud

by John Wanguba
May 15, 2022
Next Post

Housing: Bubble Collapse Will Return

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Browse by Category

  • Business
  • Econ Intersect News
  • Economics
  • Finance
  • Politics
  • Uncategorized

Browse by Tags

adoption altcoins banking Binance Bitcoin Bitcoin adoption Bitcoin market Bitcoin mining blockchain BTC business CBDC Coinbase crypto crypto adoption cryptocurrency crypto exchange crypto market crypto regulation decentralized finance DeFi digital assets Elon Musk ETH Ethereum finance funding government investment market analysis Metaverse mining NFT NFT marketplace NFTs nonfungible tokens nonfungible tokens (NFTs) price analysis regulation Russia social media technology Tesla the US Twitter

Archives

  • May 2022
  • April 2022
  • March 2022
  • February 2022
  • January 2022
  • December 2021
  • November 2021
  • October 2021
  • September 2021
  • August 2021
  • July 2021
  • June 2021
  • May 2021
  • April 2021
  • March 2021
  • February 2021
  • January 2021
  • December 2020
  • November 2020
  • October 2020
  • September 2020
  • August 2020
  • July 2020
  • June 2020
  • May 2020
  • April 2020
  • March 2020
  • February 2020
  • January 2020
  • December 2019
  • November 2019
  • October 2019
  • September 2019
  • August 2019
  • July 2019
  • June 2019
  • May 2019
  • April 2019
  • March 2019
  • February 2019
  • January 2019
  • December 2018
  • November 2018
  • October 2018
  • September 2018
  • August 2018
  • July 2018
  • June 2018
  • May 2018
  • April 2018
  • March 2018
  • February 2018
  • January 2018
  • December 2017
  • November 2017
  • October 2017
  • September 2017
  • August 2017
  • July 2017
  • June 2017
  • May 2017
  • April 2017
  • March 2017
  • February 2017
  • January 2017
  • December 2016
  • November 2016
  • October 2016
  • September 2016
  • August 2016
  • July 2016
  • June 2016
  • May 2016
  • April 2016
  • March 2016
  • February 2016
  • January 2016
  • December 2015
  • November 2015
  • October 2015
  • September 2015
  • August 2015
  • July 2015
  • June 2015
  • May 2015
  • April 2015
  • March 2015
  • February 2015
  • January 2015
  • December 2014
  • November 2014
  • October 2014
  • September 2014
  • August 2014
  • July 2014
  • June 2014
  • May 2014
  • April 2014
  • March 2014
  • February 2014
  • January 2014
  • December 2013
  • November 2013
  • October 2013
  • September 2013
  • August 2013
  • July 2013
  • June 2013
  • May 2013
  • April 2013
  • March 2013
  • February 2013
  • January 2013
  • December 2012
  • November 2012
  • October 2012
  • September 2012
  • August 2012
  • July 2012
  • June 2012
  • May 2012
  • April 2012
  • March 2012
  • February 2012
  • January 2012
  • December 2011
  • November 2011
  • October 2011
  • September 2011
  • August 2011
  • July 2011
  • June 2011
  • May 2011
  • April 2011
  • March 2011
  • February 2011
  • January 2011
  • December 2010
  • August 2010
  • August 2009

Categories

  • Business
  • Econ Intersect News
  • Economics
  • Finance
  • Politics
  • Uncategorized
Global Economic Intersection

After nearly 11 years of 24/7/365 operation, Global Economic Intersection co-founders Steven Hansen and John Lounsbury are retiring. The new owner, a global media company in London, is in the process of completing the set-up of Global Economic Intersection files in their system and publishing platform. The official website ownership transfer took place on 24 August.

Categories

  • Business
  • Econ Intersect News
  • Economics
  • Finance
  • Politics
  • Uncategorized

Recent Posts

  • Madonna Joins Hands With Digital Artist “Beeple” To Launch New NFTs
  • Luna Foundation Sold 80,000 Bitcoin Amid UST Crash
  • Bitcoin Network Strengthens As Mining Difficulty Reaches ATH Of 31.251T

© Copyright 2021 EconIntersect - Economic news, analysis and opinion.

No Result
View All Result
  • Home
  • Contact Us
  • Bitcoin Robot
    • Bitcoin Profit
    • Bitcoin Code
    • Quantum AI
    • eKrona Cryptocurrency
    • Bitcoin Up
    • Bitcoin Prime
    • Yuan Pay Group
    • Immediate Profit
    • BitIQ
    • Bitcoin Loophole
    • Crypto Boom
    • Bitcoin Era
    • Bitcoin Treasure
    • Bitcoin Lucro
    • Bitcoin System
    • Oil Profit
    • The News Spy
    • British Bitcoin Profit
    • Bitcoin Trader
  • Bitcoin Reddit

© Copyright 2021 EconIntersect - Economic news, analysis and opinion.

en English
ar Arabicbg Bulgarianda Danishnl Dutchen Englishfi Finnishfr Frenchde Germanel Greekit Italianja Japaneselv Latvianno Norwegianpl Polishpt Portuguesero Romanianes Spanishsv Swedish