I want to write about the things that you need to look out for when you are looking at a technical analysis course. Technical analysis is becoming more popular in trading and therefore so has the demand for courses.

First of all we will look at the content and then we will move on to looking at the delivery of a technical analysis course. The are lots of key issues that I believe any course should cover. You should ensure that the course you are considering does cover each element.

You first need to understand the basics so you need to learn about the why technical analysis works. Charles Dow was one of the founder of this type of analysis so it is important that you understand how he used it. Then to complete the basics you need to understand the different types of charts.

Once the basics are mastered then your technical analysis course should move onto explain different types of patterns you see on the charts. These patterns can indicate a continuation of the current price move or they could signal a reversal. You will be surprised to see how often these can be seen.

Trending can be a very profitable system to use. You will see how using moving averages will help you spot a trend and then you will be able to use that to your advantage. This technique is used a lot in the markets.

Indicators such as volume and oscillators should be covered in a technical analysis course. These will help you time markets and give weight to the patterns that you have already spotted on the charts.

Moving on to delivery now, this is where your personal preferences come into play. How do you learn best? Do you prefer the theory or the practical aspect? Today we are lucky that we have so much choice when selecting a technical analysis course. You can learn from books, DVDs or even more formal classroom seminars.

From Elliott Wave Global Market Service

This is the first in what will be a long series of free technical trading educational articles that I am in the process of publishing.  To receive an alert when a new education article in the series is posted by me you can enter your email address below – I will also include a week of our premium subscriber video services at no cost when you register.

To register to get the full technical chart pattern educations series for free click here

Now, you can give a clipboard and a stethoscope to any member of the general public that happens to be passing by.  But do you think anybody knowing this would actually allow this person to diagnose and treat them?.  I doubt it. Over the series of these many articles and via my upcoming series of technical analysis training videos I am going to give you the tools to make considered decisions that will help you to invest successfully.

In these articles and videos I will give you advice on which patterns to follow and which patterns to avoid.If and how you choose to use these patterns and my advice is up to you, whether or not you happen to make money from this advice, again that is entirely up to you.

So if you are considering becoming the proud (or not so proud owner) of a new stock then you really should consider reviewing my articles to understand these patterns and their implications to your stock. All of this free information that I will give you for some of you will be new, for others it will be a refresher about the pattern identification quirks, performance, as well as tips on how you might get in sooner, or potentially become more profitably.

Once you have reviewed the patterns, it is then time to look for similar patterns in the same stock (you do this using different time scales as well), and if that does not work, you should search for similar patterns in stocks within the same sector. Personally I review them closely to determine if the price and patterns can be applied to the current situation. I do this for the purpose of determining if there is anything to be learnt from previous mistakes.

While doing this you should consider starting the process of paper trading the chart formations of your selected stocks (don’t panic this process only takes a few minutes a day per stock). Again, even if you are an experienced investor (like me with more than 15 years experience), I find that the real benefit of paper trading is that it keeps me alert and agile.

Going through a process like this has made the task of buying or selling a stock a much more disciplined and reflex action rather than having to make a conscious laborious effort . The continual checking on how the chart pattern is progressing makes me to
develop a muchmore intuitive feel for the patterns, the stock, and indeed the market.

I will posting a long series of articles on trading patterns and formations over the coming weeks and months that are going to be completely free for registered users of Elliott Wave Global Market Service.  The registration is free and only takes a few seconds, and it does not require any personal or credit card details.

If you do register, I also give away a week’s free membership to our premium service which includes all of our market and stock video forecasting services to all new registrations.

For much more on technical analysis and market forecasting and to get a week of free market forecasting videos visit Elliott Wave Global Market Service.

The most successful floor traders are those that have the most experiance, this is no coincidence at all and should be a pointer for those who aspire to become a good trader. Day trading can be likened to being a sportsman, such as a golf pro or tennis champion, you need to be trained and in good physical shape. Skills are needed which must be developed over time and practiced until they become 2nd nature. If you want to learn how to day trade you must be prepared to put in the effort. Here are some of the key skills that you must develop as a trader.

1. Technical analysis can be used for futures as well as the more standard stocks, options and bonds that most people trade. This can give you a large edge over other traders who have not taken the time to study the charts support and resistance areas, trendline and patterns. Learning technical analysis is really a must do if you want to trade futures successfully.

2. This is a very simple point but is very important, always have your trading plan prepared before you enter a trade, never try and create it on the fly, you will be much too emotional. Make sure that you have an entry and exit point in your plan.

3. Keep your losses small!, this is the one thing that every trader must do if they want to trade for a long time. By doing this you will preserve your capital allowing you to trade another day. Your small wins will compensate your small losses allowing your big wins to give you an overall profit

4. Over trading is a big mistake that a lot of amateurs make. Professionals tend to be more patient and wait for the better opportunities to come along, this is called cherry picking and takes both patience and discipline. These are must have skills that you must develop.

5. This is a big day trading tip, it is important that you track all your trades and review them to see where you are making the mistakes. This is quite hard work, but this is what separates the professionals from the amateurs. Unless you do this you will keep on making the same mistakes. The best way to do this is to keep both a daily and weekly log.

6. Only trade when you are both physically and mentally prepared. This is often overlooked but is very important. Do you think a tennis star can win a game when they are tired and mentally not focused?, it’s unlikely. Being prepared means getting a good nights sleep, having your trading station and charts well prepared before the market opens, taking the time each day to review your trading plan and rules. Finally you must have the mental frame of mind and confidence that you are going to be successful today in your trading.

7. If you are new to trading futures take the time to paper trade until you are very confident that you are going to make money. You will know when you are ready because you will start to hate paper trading knowing that you could be making real cash profits on a consistent basis.

Remember that the markets only trend for about 20-35% of the time, the rest is either sideways or very choppy, if you want to do trend trading to win you must be fully prepared when the opportunities arise.

What are Bollinger bands? It is a technical analysis indicator used in the financial markets such as Forex, which are used to determine market volatility and relative prices in a period of time determined by the trader.

This technique was developed by John Bollinger in the early 80′s. Bollinger was based on mathematical formulas commonly used by statisticians to determine the standard deviations of the data series and adapted for use in the Forex Market. Bollinger bands are used to determine over-bought and over-sold levels.

The use of Bollinger bands Indicator is more effective when the Forex markets is without trend (ranging markets) and it is suggested that it should be applied in periods of 20 days but it may also be used even in periods of 50 days.

Bollinger bands consist of three lines drawn in relation to price action. These three lines are:

• The middle or central band: it is as a rule; a simple moving average and provides information on market trends. From the middle band it is calculated upper and lower bands by one standard deviation.
• The upper band: is equal to a moving average of 20 periods and 2 standard deviations above the moving average.
• The bottom band: is equal to a moving average of 20 periods and 2 standard deviations below the moving average.

How to use Bollinger bands to invest in Forex?

You can use this indicator to determine market volatility and relative prices in the Forex Market. You must start tracing the 3 lines in the Forex graphs, which provides you with the indications of when you should buy and sell.

In Markets without trends the strategy is to sell in higher bands and compared in the lower bands. The interval between the upper and lower band will provide you with information on the volatility or market activity. This means that the higher the volatility in the market is, the higher the standard deviation will be and because of that the bands are a little broader. If on the contrary, it happens that there is less volatility in the Forex market, the lower the standard deviation and therefore the bands will be narrower.

On the other hand, if you notice that prices will break through the upper band, in the band that is contrary, we must expect a continuation of current trends.

Calculate the moving average (MA) using the following formula:

MA = (P1+ … + Pn)/n

Pn = Price at an interval n
n = Number of periods

• Subtract the moving average (MA) of each data point (p) used in calculating the moving average. This will give you a list of deviations (d) to help you trade in Forex:
• Finally, calculate the three Bollinger Bands using the following formulas:

Superior Band = MA + 2σ
Media Band = MA
Lower Band = MA-2σ

It is not recommend using this indicator in volatile markets. But if you do, you should buy right on the break above the upper band and sell right on the break below the lower band. This is important if you notice that the bands shrink too fast (consolidation), it is likely to occur a violent break, a moment you can use trade.

Bollinger Bands provide you with 3 types of signals:

• Contractions (squeeze) means that there is less volatility in the market.
• Expansion (expansion) means that there is greater market volatility.
• 2.0 STDV close : Breakouts

What you should NEVER do?

• Never buy or sell without observing the candlestick patterns.
• Do not buy or sell if it has not detected a clear breakout of the market.
• Do not use this indicator in periods longer than 100 days.
• If prices touch the band alone, it would not mean that you should buy or sell. Never trade without a preliminary analysis.

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Remember that no investment is risk free and the Bollinger Band indicator in Forex will help you most effectively when it is used in conjunction with other tools.

If you would like to have information about Technical Analysis, Please Click Here: Forex Trading

Technical analysis of the stock market, or any other market such as Forex, Bonds, Futures, is how most traders and investors make their trading decisions. This is as opposed to fundamental analysis which most people more agree is pretty much done as a way of making trading decisions, unless of course you are Warren Buffet!.

You only have to think back to major stock market scams like Enron to know that it is almost impossible for the average, and even very sophisticated fund manager or hedge fund trader to really know what the real financial state of a company is.

Just by reading the balance sheet and other quarterly reports they release gives you a very limited insight into the real health of the company. Whereas the technical analysis charts of the company tend to give the real picture of what the market thinks of the value of the company. In the case of Enron even simple technical analysis told you to SELL when the stock was in the $80-90 range, this is why technical analysis of stocks is so popular.

So what are the secrets to technical analysis?, I’m about to tell you, here are my golden rules:

* Only use 3-5 simple technical analysis indicators

* Make sure that you understand how the indicators that you have selected work, what the parameter settings are and in what market conditions they are effective

* After selecting your indicators and parameter settings don’t mess with them.

The real secret to technical analysis is to become VERY familiar with your choosen indicators, and really this can only be done by watching and studying the market, so that you get to the point that you TRUST them.

The fact is that in any market, for each bar period, there are only 5 pieces of information, the open, close, high, low and volume, yet there are now hundreds of indicators. Most of these indicators are displaying much the same information and so are redundant.

For the record my set of indicators are:

* 4 Simple Moving Averages

* Bollinger Bands

* MACD

* Stochastics

But the way I use them is quite special, to learn more about how to become an expert at technical analysis visit:

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