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Short-term Stock Trading

Always wondered what it’s like to trade online? Luckily, it’s far easier to begin trading than it was in the 90s when Wall Street and big money were the only options. Get started with our introduction to stock trading – you’ll come away feeling confident of the task ahead, along with a base knowledge of all the most important factors.

Course Overview

Charts & Candlesticks

Line charts & bar charts

Data visualisation is so important when trading the capital markets as it provides an easy way for investors to manage and make decisions. Charts are at the centre of data visualisation as they make it possible for traders to interpret how prices move up and down, as part of technical analysis. Line and bar charts are some of the most used data visualisation...

Candlestick charts introduction

Candlestick charts are always at the heart of price action analysis and are becoming exceedingly popular, given their dynamic features and versatility. They originated in the 1700s as Japanese man Homma after concluded human emotions influence price patterns in the market. Unlike line charts, bar charts, or figure charts, candlestick charts are easy to read,...

Trading patterns introduction

Trading patterns refer to distinctive formations that appear on trading charts regardless of the security being traded. Such patterns come into being as transitions between rising and falling trends caused by price swings. Pattern recognition is at the core of technical analysis, which focuses on trying to predict prices based on patterns that happen as the...

Candlesticks reversal patterns: Bullish vs. Bearish

Candlestick patterns provide some of the best ways of tracking and predicting price movements of securities. In addition to being more appealing, they are also easy to understand and interpret. While the focus is always on-trend following, it is also possible to predict price reversals from a prevailing trend while relying on candlesticks patterns. Bullish C...

Candlestick continuation patterns

Candlestick patterns are the building blocks of technical analysis in the financial markets. Technical and fundamental analysts rely on candlestick continuation patterns when trying to predict where the market will move after a period of consolidation. Continuation patterns in charts highlight periods of correction and consolidation that take place while the...

Understanding trading gaps

Gaps are a common occurrence in the financial markets whenever there is a disparity between opening and closing prices. Appearing as wide openings with no activity in charts, such gaps provide valuable information and insights about market dynamics. What Are Trading ‘Gaps’ Gaps in the capital markets are essentially areas in a chart whereby price...

Trading Strategies

Understanding technical analysis

Technical analysis is a trading discipline that involves studying and analyzing past market data with a view of predicting future price movements. It differs a great deal from the fundamental analysis that entails trying to evaluate the intrinsic value of a security. Technical analysis as a methodology of trading focuses on price movements as well as trading...

Technical analysis strategy basics

Technical analysis is an evaluation technique used by traders to predict price movements in the financial markets. Unlike fundamental analysis, which focuses on underlying fundamentals such as revenue valuation and industry trends, technical analysis relies purely on statistical analysis. Technical analysis tries to predict the future price of an underlying...

Principles & Assumptions Behind Technical Analysis

Technical analysis is a popular methodology used by traders and investors to analyse the financial markets or securities. The practice solely relies on price movements and volume data to value securities under study. Technical analysis principles Technical analysis relies on the idea that market forces, made up of demand and supply, influence prices. Propone...

Characteristics of a great technical trading strategy

A trading strategy is a must-have for anyone looking to create wealth by trading securities in the financial markets. A proven trading strategy is one that is able to spot reliable entry points for opening trades while also factoring in potential exit points as part of a risk-reward play. Characteristics of an excellent trading strategy Time Frame While it i...

Position trading

What is position trading? Position trading is a trading strategy common with trend followers. While relying on longer period charts, position traders determine a trend and open position based on the prevailing trend. Unlike day traders and scalpers, position traders are less concerned by short-term market fluctuations, which is one of the reasons why they ho...

Day trading

What is day trading? Day trading is an active trading strategy that involves opening trades once the market opens and closing them, at a loss or profit, before the market closes. In day trading, traders don’t leave positions opened overnight, thus relieving themselves the burden of additional costs or unforeseen events that might affect price movements...

Scalping

What is scalping? Scalping is an active trading strategy deployed by traders looking to take advantage of small price movements in the market. Scalpers open and hold positions for short periods while relying on strict exit strategies. Once a position is opened, a trader will hold the trade as long as it is working on his or her favour. Conversely, the trader...

Swing trading

What is swing trading? Swing trading is a trading strategy deployed by traders looking to take advantage of price reversals. Every prevailing trend once in a while, experiences reversals upon hitting critical technical levels. At the end of every trend, there is usually a period of high price volatility in the opposite direction, which swing traders always l...

Indicators

Understanding technical indicators

Technical analysts rely on a number of tools when predicting future price trends. Technical indicators are at the epicentre of  analysis in the capital markets as they provide valuable information on where the price is likely to go. What are technical indicators? Technical indicators are mathematical calculations based on price and volume that traders u...

Moving averages

What are moving averages? Moving Averages are commonly used technical indicators that smooth out price to show current market direction as well as indicate trend reversals. The trend-following indicator is also known as a lagging indicator as it is based on past price movements. By smoothing price action, these sets of indicators filter out noise. Regardless...

How to use moving averages

Moving averages are one of the most popular technical analysis tools for traders. Trading strategies based on Moving averages are popular as they can be tailored to fit any period, therefore they’re considered ideal for both long-term and short-term traders. Moving Averages for Trend Analysis Moving Averages provide valuable information on the directio...

Moving average convergence-divergence indicators

What are moving average convergence-divergence indicators? Moving average convergence-divergence indicator (MACD) is a popular momentum indicator that technical analysts use to identify whether a market is trending up or down. The indicator shows the relationship between two moving averages used in price action analysis.  MACD uses three numbers for its...

Exponential moving averages

What are Exponential Moving Averages? Exponential Moving Average (EMA) is a trend-measuring indicator known to respond quickly to recent price changes than any other Moving Average. The indicator gives more weighting to recent price data than any other data regardless of the period of use. Just like other moving average indicators, EMA are best suited for tr...

Understanding bollinger bands

What are Bollinger Bands? A Bollinger Band is a technical analysis indicator used to measure market volatility. Simply put, the indicator tells whether the market is in a period of low or high volatility, depending on the size of the bands and how prices oscillate. A Bollinger band primarily consists of a set of lines plotted from a simple moving average tha...

Using trading oscillators

What are trading oscillators? Oscillators are technical analysis tools ideal for markets that are range-bound and trading sideways. They can also be interpreted as indicators that fluctuate above and below a centerline as the price of an underlying asset fluctuates from high through low and vice versa. The most popular oscillator indicators include a stochas...

Momentum oscillators

What are Momentum Oscillators? Momentum Oscillator is a type of leading indicator that measures the amount by which the price of given security has changed over a given period. These sets of indicators help gauge the strength and momentum of a trend as well as overbought and oversold market conditions. Being an unbound oscillator, the indicator does not have...

Understanding the Relative Strength Index

What is Relative Strength Index? Relative Strength Index (RSI) is a technical analysis indicator that measures the speed and change of price movements. By measuring the magnitude of price changes, the indicator can evaluate both overbought and oversold market conditions with ease. Relative Strength Index is a versatile technical analysis tool for; Generating...

About the author

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Harry Atkins
Harry joined us in 2019 to lead our Editorial Team. Drawing on more than a decade writing, editing and managing high-profile content for blue chip companies, Harry’s considerable experience in the finance sector encompasses work for high street and investment banks, insurance companies and trading platforms.

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