Archive for January, 2009

Read Resistance Lines

Saturday, January 31st, 2009

This week on the XAO there was a rise of 172 points over all. Is this move to the upside likely to continue? Let’s take a look at what the stock chart chart is showing us.
Tuesday was a bounce off a support after downward momentum failed to continue on from Friday. As the week progressed [...]

Enter Stock Position

Tuesday, January 27th, 2009

Many systems available out there, identify patterns in charts and the break out days. Last week CSL had an ascending triangle with a breakout day, as shown in the chart below.
(click on images to enlarge)It seems like the boat has already sailed when a stock has moved so much before entering a position. What if [...]

XAO Downtrend

Monday, January 26th, 2009

As expected the XAO continued down this week.
Monday was an up day that retested the resistance made by the flag. Once this line was respected the XAO spent the rest of the week heading down. There is now 3 consecutive Lower Peaks (LP) indicating the sellers now have control.
There is strong weekly support line at [...]

Peaks and Troughs Trading

Tuesday, January 20th, 2009

At times a stock can travel sideways, not really making any sort of significant price moves. As a short term trader, we like looking at around 3 months worth of data to give us an idea of the direction of the stock.
Peaks and Troughs is a very popular and successful way of determining whether buyers [...]

Bearish Down Day

Tuesday, January 20th, 2009

Last week’s weekly wrap on the XAO identified a possible Bearish Flag pattern. Let’s see what this week trading has done.
Below is a daily chart of the XAO. Highlighted is Thursdays trading bar and it has clearly broken through the bottom of the flag that has been acting as support. It was a Bearish Down [...]

Successful Trade in the Planet Wealth Trading Room

Monday, January 19th, 2009

Another successful trade in the Trading Room this week. We found a high probability trade going against the overall trend and had a good return from it.
Let’s take a look at ways we can trade a stock safely in the opposite direction to the overall trend.
Currently SUN has been in a down trend for the [...]

Fibonacci Trading

Tuesday, January 13th, 2009

This week the XAO touched and retreated off a significant Fibonacci level suggesting a possible flag formation.
Flag formations (definition discussed in BHP post 17/11/08) have a higher rate of success when the flag flies at the 50% Fibonacci level. The last major higher on XAO was at the beginning of November and this was the [...]

Stock Market Entry Signals

Thursday, January 8th, 2009

Trend lines are more significant the longer they have been validated for, so when looking at a stock to trade shorter, it is important to look at the long term picture as well as short term.
CPU shows us a great example this week. Tuesday could have been an entry signal for a long position as [...]

Trading in the Holiday Season

Sunday, January 4th, 2009

Happy New Year Traders!
This week we will see the increase of volume on the market with large fund managers  and institutions coming back on board from the holiday season. With low volume over the last couple of weeks, we have seen alot of consolidation on most stocks in the top 20, which is all good [...]