In this week's "Traders Whiteboard" lesson, I dive into two chart patterns that the pros use everyday to great effect. The chart patterns that we will be looking at are two of my favorites as they have a reliability factor of around 90%.
The chart patterns in this video trading lesson are well known inside the professional trading community. However, outside of the pro circle they seem to be shrouded in mystery.
In this 5 minute video, I peel away the layers of mystery and show how you can benefit from these two very reliable and profitable chart formations.
What's amazing about these two chart patterns, is the fact that after my 3 decades of real world trading, they continue to repeat themselves, over and over again.
This phenomenon is likely to continue into the future as it reflects human nature. We know for a fact that no matter how smart we think we are, our basic genetic nature has not changed in over 2,000 years.
With that fact on our side, I think it's a safe bet that these two chart patterns will likely stick around for the next generation of traders.
Enjoy the lesson.
Adam Hewison
President, INO.com
Your reminder about double tops (and bottoms) and pivot points--could you add that as a search? With 90% accuracy, one could do nothing but those and do well!
Hi I want to comment over S&P futures , recent weekly chart is BUY , and daily chart stuck with range of 1390-1320 approximately, following trade triangle would place us in 3-4 loosing trades in just 2 week , daily indicators are changing even daily ..... would like to hear on how to trade such market and on such fast indications daily. Kind Regards Fadi Kheder
Fadi,
You are correct the last 3 trades would not have been profitable. However, you have to take the trend into considering. For example a day trader can make money off small sideways moves, however a swing trader is looking for larger moves. Therefore if a market is moving sideways, you would want it to break one direction or another.
If you look at the charts below... we had one swing since the weekly trend shifted, since then the market has gone flat. The triangles will always be issued, regardless of the trend strength... therefore we have to use the Chart Analysis score to determine if there is a positive trend, negative trend or sideways move. Use the trend analysis score to determine if you should legitimately be in a position. This may very depending on your trading style (long term, intermediate term, short term, scalper).