The double top is a chart pattern formed by two consecutive price peaks that leads to a bearish reversal. For years, traders have claimed that the double top is a high probability short setup. This is because a double top signifies that bulls are having trouble pushing the price past the prior high. However, there […]
As the long term charts on this page show, stock markets can go for lengthy periods with poor returns. Investors should utilise a diversified approach and remember to reinvest dividends.
As a trader you only need one or two good trades to pay for the whole month, sometimes the whole year. You could be treading water for weeks then you catch one big move that pays for all your losses. Because of this, trading books recommend you stay disciplined and wait patiently for only the […]
I rarely watch trading content on YouTube but last week I clicked on a forex video that caught my attention. Soon enough, I had fallen down a rabbit hole. My feed was taken over by trading videos and in between were advertisements for signal services and chat rooms promising quick and easy profits. YouTube has […]
You’re probably aware of how difficult financial trading can be and how much luck plays a role in results. Latest figures from Finance Magnates show that in the year up to August 2017, 76% of CFD traders lost money. As shown by the graphic below, some brokers were better than others: But it gets worse. […]
If you want to backtest trading strategies it’s important to have good quality data. I use Norgate Data for my end of day price quotes and am very happy with the quality and service. However, there are times when I want to scrape stock data from the web. For example, if I want to extract […]
In today’s blog post I take a data mining approach to find a potentially profitable trading strategy based on the movement of US treasury rates. The idea of this strategy is to find a selection of stocks that respond favourably to a downward price movement in US Treasury yields.
The uptick rule is a short selling restriction that says you can only short sell a stock on an uptick. In other words, you must wait for a stock to trade a tick higher before you can short it. This rule was first introduced in 1938 to promote market stability and investor confidence. However, the […]
Profitable stock market strategies are not easy to come by. But one proven path is to seek out stock market anomalies. A stock market anomaly is a rate of return or investment strategy that seems to defy the efficient market hypothesis. Today, most investors agree that markets are fairly efficient even if they don’t believe […]
The Hikkake pattern is a simple price action or candlestick pattern that is used to find market turning points. The pattern is essentially an inside day with a fake breakout and is originally credited to Daniel Chesler CMT.