Market Review and Trends
Improving your trading accuracy by following a bigger trend
By Dr Wealth  •  September 22, 2009
[caption id="attachment_3464" align="alignright" width="150" caption="Photo by Gabriel M."]Photo by Gabriel M.[/caption] As the saying goes, “trend is your friend”. It does not pay to go against the trend, especially the bigger ones. What do I mean by bigger trends? Bigger trends are trends that are only visible at longer time frame. For example, if you are trading using a day chart, a bigger trend can be identified from a weekly chart. If you are trading an hourly chart, a bigger trend can be identified on a daily chart. Dr Alexander Elder developed a triple trading screen to catch such trends and align his entries to them. Here is a brief explanation on how the triple trading screen works: 1) Market Tide The first screen is known as the identification of the market tide. It is important only to trade in the direction or trend of the tide. If it shows an uptrend, only take buy signals and ignore sell signals. The trend can be determined using trend indicators like EMA and MACD. A factor of 5 has to be applied to your trading time frame. If your trading time frame is daily, then 5 x daily = weekly. Hence, identify the market tide on a weekly chart with EMAs, MACD or your favourite trend indicators. Read more...
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By Dr Wealth
Dr Wealth provides trusted financial education to individuals. We teach researched and actionable investment methods so that our graduates are successful in their investment journey and achieve market-beating returns.
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