If TraderMaker was like EVERY OTHER site we would describe technical trading and analysis like www.investopia.com in the below example!
“In momentum trading a trader watches for signs that a stock is about to “pop”, that is, undertake a significant uni-directional price movement on high volume for a sufficient period of time, which enables a profit. By virtue of watching the momentum line, the momentum trader has already engaged in technical analysis by examining stock charts for signs of the breakout. But the technical indicators used in momentum trading are only the tip of the proverbial iceberg; they are only a small sampling of the wide range of chart and graph patterns available to the technical trader.”
We could also tell you what type of trader you could be…
Reviewing Different Types of Traders
Before we focus on technical trading, let’s review the major styles of equity trading:
The scalper is an individual who makes dozens or hundreds of trades per day, trying to “scalp” a small profit from each trade by exploiting the bid-ask spread.
Momentum traders look to find stocks that are moving significantly in one direction on high volume and try to jump on board to ride the momentum train to a desired profit.
Technical traders are obsessed with charts and graphs, watching lines on stock or index graphs for signs of convergence or divergence that might indicate buy or sell signals.
Fundamentalists trade companies based on fundamental analysis, which examines things like corporate events such as actual or anticipated earnings reports, stock splits, reorganizations or acquisitions.
Swing traders are really fundamental traders who hold their positions longer than a single day. Most fundamentalists are actually swing traders since changes in corporate fundamentals generally require several days or even weeks to produce a price movement sufficient enough for the trader to claim a reasonable profit.
All this is a distraction, these terms and ways of thinking are old school and should be confined to the paperback books they were taken from 20 years ago. The fact of the matter is if you want to trade technically you have to understand the following things:
1. Understand how to read your charts and identify the underlying trend
2. How to identify and trade candle stick formations
3. How to use and identify entry and exit point with oscillators
4. What technical indicators other traders are looking at
5. How to automate your trading
6. How much you realistically want to make in a trade, day, week or month
The main aim of trading is to make money. The main aim of technical trading is to give you consistent signals of where is best to enter and exit the markets. The fact that you call yourself a ‘scalper’ or a ‘position’ trader just refers to how long you wish to hold an open trade for. The technical signals for entry and exit will be the same for most styles of trading.
If you are interested in learning about points 1 to 4 then open an account with www.intertrader.com and you can have FREE access to watch my webinars on these subjects.
This is just the start of trading technically. There are many ways of which once you have an understanding of you can choose to trade. We recommend that if you are serious about charting and fully utilising all the many technical indicators currently available that you use Meta Trader 4.
Meta Trader 4
Meta Trader allows you to chart in a professional manner and overlay a number of pre set oscillators and strategies. Once you have set up your charts you can interact with the markets through this system and you can mange one or more accounts at the same time.
If you are serious about technical trading and want to create EAs and other automated signals then Meta Trader is the perfect platform to use. There are whole forums and communities that develop systems and code trading signals. There is all the information and support on the web to enable you to completely automate any trading rules or strategies.
With this system you can also be as mobile with your trading as you are as the software is designed to run on your phone.
EAs and trading strategies
If you are interested in buying signals and trading on the back of other trader’s signals then there are a number of ways of doing this.
1. Social trading
We recommend that if you are relatively new to trading that you should look at www.eToro.com and what they offer through their ‘open book’ platform.
Social trading is the newest, most exciting and most rewarding way for you to get access to the financial markets. With social trading the wisdom of the crowd comes to your aid powering your trading to a level of possibilities which you never knew was possible. As the world’s largest online financial trading community, nobody can offer your trading more of a social boost than eToro.
See, follow and copy the trading activity of more than 1.5 million registered eToro traders whenever you want to, 24 hours a day. Whatever you’re thinking of trading you’ll find plenty of ideas and inspiration from the eToro social trading community.
See, Follow and Copy Pro Traders
With social trading you earn the opportunity to spot the best financial traders in the eToro investment network quickly and simply.
What you do next is entirely up to you:
- Follow the activity of your fellow traders
- Communicate with other traders one on one
- copy the best traders live and make their success your own
Find Your Guru
Trading with eToro’s social investment network means that you’re never alone. However experienced you are as a trader, and however you like to interact with others, our community is rich with opportunities.
- Pick out experts to make your guru – follow their trades, determine their trading method and copy the trades you like
- Track the ongoing performance of any trader through a series of simple tools and keep easily informed on everything they’re doing
- Recruit followers via OpenBook and get recognized for your skill.
- See how other hotshots trade, and spot more of the right opportunities as they happen.
2. Signal Providers
There are many signal providers that can send you to the second up dates by email and SMS about relevant price action and target levels. We recommend that you look at the following sites in order to see what may suit your trading and risk management style
3. Charts and technical indicators
For technical analysis we recommend Meta Stock 12 combined with our powerful All Time Frame Trading ‘add on’. With this set up you will have access to literally 1000s of markets and a wealth of opportunity. Running our add on will enhance your view and give you alerts on ALL of these products to show you potential trading opportunities. This is what automation and technology is for. No longer are you a swing FTSE trader, pigeon holed, you are now a trader of all markets on all time frames.