A breakaway gap is a chart pattern in technical analysis that shows a big opening gap in price above the previous day’s closing price. The gap in price action on the chart is where no trading took place between buyers and sellers. A breakaway gap to the upside has to break above previous resistance while […]
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Market Wizard Richard Dennis was a legendary commodities trader nicknamed the “Prince of the Pit.” Early in his trading career in the 1970s, he was loaned $1,600 and is said to have grown it into $200 million in approximately a decade of trend following trading. He traded a lot of breakouts and momentum signals in
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This is a Guest Post By Robert F. Smith @RobInTheBlack of Smith’s In The Black YouTube Channel Algorithms, a traders best friend. Wait, What?? One of the most common misconceptions in Trading is that “Algorithms are picking Me Off”. Nothing could be further from the truth. Perhaps you’ve had this happen to you. You place a stop order under
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Pure price action signals use the current price alone to indicate when to get in and when to get out of a trade. It is possible to use pure price action signals to create systems for entry and exit signals to trade. A range trader will use a repeated price level that hasn’t broken as
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In the trading world there is an ongoing debate in many circles on whether trading price action alone is best or if technical trading indicators can add value to trading decisions. Many believe that trading based on price alone is the best way to trade as you are don’t over complicate your decisions with the
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Order flow is the process of buyers and sellers trading between one another that causes market prices to stay the same or move up and down. Zooming in on order flow it is the volume bars along with the time and sales information of trades. Order flow is where buyers and sellers meet at an agreed
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Downtrends are timeframe specific so look for these signals on the timeframe you are trading whether it is intraday, daily, weekly, or monthly. Here are the ten signals that show a chart is in a downtrend. Most downtrends start with a gap down in price, some gaps fill before going lower but it usually is
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The Occam’s razor heuristic was created by William of Ockham who was a philosopher and theologian who preferred simplicity for explanations over unneeded complexity. Occam’s razor is one way to solve problems using the principle that the most obvious answer is the right one and adding complexity in reaching a solution should not be done
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Apple is one of the top performing stocks of the past 27 years with a +11,393% return but what if I told you there was a trend trading signal that doubled those returns to +25,896%? Would you be interested? The power of moving average crossover signals is first in finding the right short and long
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A price action trading system is a process for using new price data to make buy and sell decisions on a watch list of markets. A price action trading system attempts to use entry and exit signals that have an edge by creating good risk/reward ratios that lead to profitable trading. There are five primary
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