Recent content by Alan Farley

Swing trading can be a great way to profit from market upswings and downswings, but as I’ve always said, it’s not easy. Mastering swing trading techniques takes considerable time and effort. To help get you started, here are 30 rules to think about as you begin and ultimately master the swing...

The 50-day moving average marks a line in the sand for traders holding positions through inevitable drawdowns. The strategy we employ when price nears this inflection point often decides whether we walk away with a well-earned profit or a frustrating loss. Considering the consequences, it makes...

Buy and sell cycles reveal hidden intentions of the market's biggest players, as they engage in macro strategies that affect price direction. Investors and traders can identify these cycles through technical tools that measure the persistence of the push behind these cycles and can use these...

Scalpers seek to profit from small market movements, taking advantage of a ticker tape that never stands still during the market day. For years, this fast-fingered crowd relied on Level 2 bid/ask screens to locate buy and sell signals, reading supply and demand imbalances away from the National...

Financial markets attract all sorts of participants, from part-time hobbyists looking for extra cash to multinational institutions moving billions of dollars across thousands of instruments. The trading game stretches across both ends of the spectrum, with part-timers and at-home gamers...

S&P 500 index futures surged in popularity in the past decade after the SEC’s pattern day trading rule triggered an exodus of retail capital out of equities and into Globex, CME’s 24-hour electronic trading platform. Volume hit a historic peak in 2011, underpinned by a worldwide transition in...

Swiss market technicians Etienne Botes and Douglas Siepman introduced the vortex indicator in the January 2010 issue of the magazine, “Technical Analysis of Stocks and Commodities.” Since then, the new technical indicator has gained traction as a reliable trend following indicator that can...

Millions of traders test their skill in the financial markets each year, but most are destined to lose their stakes and walk away with their tails between their legs. A select few defy the odds, churning out profit after profit over long periods, building the wealth, security and wellbeing that...

Day traders need continuous feedback on short-term price action to make lightning fast buy and sell decisions. Intraday bars wrapped in multiple moving averages serve this purpose, allowing quick analysis that highlights current risks as well as the most advantageous entries and exits. These...

A momentum strategy seeks to profit from buying high and selling higher on the long side while selling low and covering lower on the short side. Most traders fail in this enterprise because they haven’t mastered the five elements of a perfect momentum trade. Once in place, the profit and loss...

Financial markets are enormously complex, but most trading strategies tend to fall into one of two categories: trend following or swing trading. Each strategy has advantages and disadvantages, as well as specific requirements that investors must follow consistently in order to avoid errors...

Tape readers have an advantage over chartists because they can interpret intraday data in real time, filtering pages of numbers into surprisingly accurate predictions on short-term price movement. This near-legendary market skill has additional perks, allowing them to measure emotional intensity...

The best trade could be in the opposite direction when a classic price pattern doesn’t behave according to perfect rules outlined in popular books and web sites. In fact, well-known patterns such as the head and shoulders and bull flag have clearly defined levels that can trigger trade entry...

Fibonacci analysis leaped into the technical mainstream late in the 1990s. Futures traders had been quietly using this charting tool for several decades when Net-based, real-time software ported it to the equity markets. Its popularity exploded as at-home traders experimented with the arcane...

I get more questions about stop losses than about any other subject. Clearly this strategy causes traders a lot of pain and confusion. Some of it stems from the schizoid nature of our modern markets. But most of it reflects an underlying weakness in trade management skills. What takes place at...