Forex Trading: Price Models
1. If the market establishes new historical maximums and doesn't fall there is every prospect that movement of the prices will proceed. Sales on new maximums are one of the greatest errors of traders-laymans.
2. Narrow market consolidation near to the upper edge of a wide trading range is the bull figure. Similar narrow consolidation near to bottom edge of a trading range is the bear figure.
3. Play breakdowns of a long narrow range with placing of a stopping near to other edge of a range.
4. Breakdowns of trading ranges which one-two weeks keep are longer and is one of the most reliable technical indicators of approaching trends.
5. The general and especially useful form of the above-stated rule: flags or the pendants formed over the top border (or under the bottom border) the previous long and wide trading range, as a rule, appear rather authentic figures of continuation.
6. Trade in a direction of wide ruptures.
7. The ruptures arising after the long periods of consolidation, in particular, after one or two months of trade in the limited range, often appear fine signals (such figure especially well works in the bear markets).
8. If the rupture which has arisen at breakdown level isn't filled within the first week, it should be surveyed as rather reliable signal.
9. Breakdown to new tops or hollows which within the next week or two rupture with return to range frameworks follows, appears especially reliable figure speaking about the bull or bear trap.
10. If the market makes breakdown to new tops or hollows and then comes back in the previous trading range and forms there a flag or a pendant, consider that there was a trend turn. It is possible to open a position in a turn direction having put a stop abroad a flag or a pendant.
11. Breakdown of a trading range which deep return to a range (for example follows, on three quarters or is more in a range) is one more significant form of the bull or bear trap.
12. If the obvious V-hollow is followed nearby consolidate formation it can serve as additional confirmation of a hollow. However if this consolidation then makes the way downwards and the prices come nearer to a V-hollow minimum it is necessary to wait for renewal of a falling trend and achievement of new minima. In the latter case it would be possible to occupy short positions at use of protective suspensions near to the top border of consolidation. Similar comments would approach to a case of V-tops which follow consolidate formation.
13. V-tops and V-hollows with the subsequent multimonthly consolidations which start to be formed right after turn over points often appear long-term maxima or minima.
14. Narrow consolidations in the form of flags and pendants often appear authentic figures of continuation and allow entering into an existing trend at close enough placing of a stop point.
For those who want to participate in forex trading should start from learning the basics of currency exchange market to make sure you do not experience problems with this industry.
There is another option - you can hire professional traders to do this job for you - read more about forex investment here. Also make sure to search for the info in a good forex book.