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Friday, November 6, 2009

Stock Forex Market Trading Blog, Daily Trading Blogs for Traders - Zig Zag Trading Indicator

 

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Zig Zag Trading Indicator

Zig Zag indicator is used by traders to reduce the "noise" in a trending security. It is very useful in finding price trends, finding support and resistance levels and in evaluating chart patterns like head and shoulders pattern, double tops and double bottoms. Actually Zig-Zag is not considered a true indicator, but as a filtering program to eliminate random price swings of a given period.





There is not an exact formula for zig zag indicator; it is a computer program which wipes out all price movements less than x percent or points. For example if you use a 5% filtering, all price movements of the stock less than 5% will be eliminated from the graph. Traders can also set the zig-zag amount in points. Thus the indicator helps the traders to better explore the market cycles and long-term chart patterns.

Zig zag trading indicator is widely used in Elliot wave analysis. The indicator is a lagging indicator and has zero predictive power. The last leg of the indicator is generated dynamically; it can change as the last leg is not set until the future price is already known. Traders should never use zig zag indicator for generating entry and exit points but for just understanding past price movements. The indicator can offer better results when used with other indicators and chart patterns.

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Thursday, November 5, 2009

Stock Forex Market Trading Blog, Daily Trading Blogs for Traders - Bullish Concealing Baby Swallow

 

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Bullish Concealing Baby Swallow

Concealing baby swallow is a bullish trend-reversal candlestick pattern indicating the start of a new uptrend after a downtrend. It is a four candlestick pattern comprised of all bearish (black or colored) candlesticks. Bullish concealing baby swallow pattern is a highly reliable pattern, where trend reversal occurs because of the extreme bearishness of the trend.






The requirements of a bullish concealing baby swallow pattern include,
  • The market should be characterized by a significant downtrend.
  • The first two days are characterized by bearish marubozu candlesticks without any upper or lower shadows.
  • The third day is a bearish day opening below a gap and is characterized by an inverted hammer formation, the shadow of which trades into the body of the second day candlestick.
  • The fourth day is also a bearish marubozu day which opens a gap above the third candlestick and completely encloses the third day candlestick.

Bullish concealing baby swallow formation occurs when there is a strong bearish sentiment in the market. The bearish marubozu formations of the first two days indicate that the downtrend is strong. But the long upper shadow of the third day candlestick and gap above opening of the fourth day candlestick indicate that the trend is weakening. The fourth day also offers a perfect opportunity for shorts to cover their position. Once that's done, the trend is expected to reverse.

Bullish concealing baby swallow is a highly reliable formation; however, a bullish candlestick with a gap-up or a higher close on the next trading day is necessary for confirmation of the trend.

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Wednesday, November 4, 2009

Webinar Today at 4:15pm EST - Live from the Trading Floor at the CME Group

PTCLogo
 
Webinar Wednesday, November 4th at 4:15pm EST
 
Join our Webinar on Wednesday, November 4th at 4:15 pm EST.  Managing Director Richard Regan will review the trades that were taken in the trading room as well as do a Q & A session with the attendees! 
 

https://www2.gotomeeting.com/register/908469986

 
For further information regarding our proprietary trading opportunities for new and experienced traders please request an application at  hr@protradingcourse.com.
 
Sincerely,
 
The Pro Trading Course Team
312.379.3571
-Futures
-Forex 
Richard Regan

12 years of trading experience

Former pit trader

Training and backing traders since 2002             

Member at the Chicago Mercantile Exchange

Trade Room
Join Richard each day as he trades live from the floor of the CME, opening to closing bell.
 
Pro Trading Course is located at the Chicago Board of Trade, 141 W. Jackson Blvd. Suite 3125, Chicago, IL 60604.
 
 

Stock Forex Market Trading Blog, Daily Trading Blogs for Traders - What are BRIC ETFs?

 

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What are BRIC ETFs?

BRIC ETFs are exchange traded funds which invest in stocks associated with BRIC nations, which are Brazil, Russia, India and China. These are countries which are considered as the leaders of emerging economies because of steady and fast economic (GDP) growth in the past and are constantly exploring their high levels of natural/human resources. BRIC ETFs allow investors to passively benefit from this growth.





BRIC ETFs are excellent ways to diversify the investment portfolio. They are also believed to offer better returns than ETFs tracking NYSE and S&P; or American and European markets as a whole. Different BRIC ETFs may have different weightage for different countries; for example Claymore BRIC ETF (EEF) has the following allocation proportions - Brazil 46%, Russia 5%, India 13% and China 36%. Apart from tracking the securities traded in BRIC exchanges, many BRIC ETFs also track stocks of BRIC countries traded in American and European markets.

Many investors consider BRIC ETFs as an alternative way to profit when the dollar and US economy are weak. BRIC ETFs usually have higher expense ratios than traditional ETFs. They are also considered risky as the political climate of these nations can change drastically. The recent recession, which hit these economies too, has also raised some concerns over these economies. The decoupling theory of emerging markets, which stated these economies will grow independently, has also proved wrong so far.

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