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On the 10th May we saw the All Ordinaries Index reach an all time high of 5,352 points. After that it fell and on the 14th June it reached a low of 4,726 points. This represented a major change from what we'd seen for the past 3 years since March 2003. March 2003 to May 2006 was a period in which the All Ords showed an extremely strong bull market. Click here to see a chart of the All Ords through this period Since May of this year, the market has been undecided about which direction to head and we’ve witnessed a period of consolidation where the market has been rising and falling in a narrowing range. This has made things a little difficult for inexperienced traders. I have become a little concerned for my graduates during this period. You see the methods I have previously taught rely heavily on a consistently trending market. Now that this has changed, I feel it important that I make you aware of the risks during these turbulent times. So today I would like to introduce you to a way of reading the market that will allow you to safely trade in the current environment, so as to lower your level of risk and improve your profitability as a trader. When the market is trading consistently in one direction it’s much easier to follow, however, a regular and consistent trend has not existed over the past few months. This therefore calls for a change of strategy. Even I have needed to focus my attention on more advanced methods of analysis in order to compliment my usual methods of analyzing the market. The method of analysis that has served me well over these past few months is the use of Chart Patterns. The past few months have been difficult for new traders. Some have patiently “sat it out” in the hope of the market “going back to normal”. Others who were not so patient have been scarred by the nasty surprise of a share price that suddenly changed direction. Others stayed in too long and could have taken a profit, only to see those profits withered away when the market “changed its mind”. Others got out following their stop, only to find out that if they’d stayed in longer the price would have come back in their favour. These are just some of the frustrations that I’ve been hearing from my students. So what’s the answer? In order to help my graduates refine their skills, I’ve spent the past few months developing a brand new seminar called “Patterns for Profits” - which teaches you how to trade effectively during non-regular trending periods like we are seeing at the moment. Let me tell you about what’s covered in this seminar… Chart Patterns Chart Patterns are a system for predicting stock market trends and turns! Hundreds of years of price charts have shown that prices tend to move in trends. A trend is merely an indication of an imbalance in the supply and demand. These changes can usually be seen through changes in share prices. These price changes often form meaningful patterns that can act as signals in trying to determine the future direction of shares prices. Research has proven that chart patterns offer the user high forecasting ability. Over a series of articles I will explain the use of Chart Patterns. These exciting strategies have worked extremely well for me. While most others have found the market difficult to read, I have managed to make consistent and reliable profits and for me it has simply been business as usual. So the time has come to share this invaluable information with you so that you too may achieve consistent winning results in your trading. I will be introducing you to chart patterns, and teach you how to identify repetitions in the market, so that you too can make timely and accurate decisions when predicting market trends. How Chart Patterns work…Technical Analysis (Charting) is the study of the way that crowds of people will react to certain market situations. This method allows us to identify certain patterns in price charts. We are therefore able to form a view on the likely direction that the price of a share will head. There are numerous chart “patterns” which can provide us with insight into the market’s sentiment towards a share and therefore it’s future price movement. These patterns are categorized into 3 main types:
Over the coming weeks I will be covering the following patterns:
These are some of the best patterns to trade. Be sure to lookout for my next article on Chart Patterns where we will cover each of the patterns individually. To Your Success Jules Dawson Jule Corporation Pty Ltd
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