MTI Analyst Articles

Forex Technical

Technical Formations to Trade in the Markets

January 20, 2010

 

Jose Tormos - FXMVP

Performance is achieved by continuing to educate yourself to identify the opportunities at hand. The results that come from proper education--focus, discipline, patience, self control, and confidence, the management of risk, stress and emotion can be life changing and a thing of beauty.

 

Chart Analysis

The market can only do three things: move up, down or sideways. The most successful traders establish a simple trading methodology or plan for entering the market at or near a bounce in their direction, establishing a well-thought-out exit for profit, as well as establishing a clear location to limit potential loss while applying sound equity management. Trading is like exploring undiscovered terrain--some are better at it than others and you need to know when to make a U-turn. Here, we examine a simple technique for breaking down the markets and when it's time to make a U-turn. That U-turn is called a "King's Crown." As long as you follow the rules to this trading formation your wins should be substantial while keeping your loses to a minimum. Trading should be fun and The Kings Crown Reversal is easy to identify and can payout huge dividend to those who want to be King. Here we see the USD/JPY currency pair forming the Kings Crown and in our Live Video Analysis we recommend entry and exit points for our students live as its happening.

Chart Analysis

A pennant formation occurs after a fairly large up or down move. After such a strong run-up, the market will relax and move sideways before continuing in the direction of the primary trend. This vibration can be seen as a symmetrical triangle, where two trend lines converge to a point, hence the term "pennant". While inside the pennant, there are a number of minor price fluctuations that occur through small support and resistance. After this period, the market will eventually breakout of this consolidation zone with an increase in price and volume. The breakout from the pennant pattern will often times be equivalent to the first large move prior to entering this formation which is one of our traders tips. The pennant formation is one of the more reliable trading patterns used by our Forex Traders all over the World. On this chart we are getting ready for a breakout soon with the GBP/JPY which has been in the pennant formation for a few days now. Again we provide our students with strategic entry and exit points that align with sound equity management or we simply pass on the trade opportunities.

Analysis

Market Traders Institute provides traders the ability to take advantage of the foreign currency exchange, so it doesn't take advantage of them! Empowering our clients to become a world class forex trader!

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