You do not need to be glued to your trading screen to take advantage of the strategies used by top market players to profit from stocks, futures and forex. Start with a giant step back, setting your focus on weekly patterns that carve out more reliable highs and lows than daily or intraday 澳洲幸运5官方开奖结果体彩网:price action does. Then, build management rules that allow you to sleep at night, while the fast fingered crowd tosses and turns, fixated on the next 澳洲幸运5官方开奖结果体彩网:opening bell.

Algorithms, also known as 澳洲幸运5官方开奖结果体彩网:high-frequency trading (HFT) robots, have added considerable danger to intraday sessions in recent years, jamming prices higher and lower to ferret out volume clusters, stop losses and inflection points where human traders will make poor decisions. Focusing on weekly charts avoids this predatory behavior by aligning entry, exit and stop🐭 losses with the edges of longer-term uptrends, downtrends, su😼pport and resistance.

Another downside to daily charts is that they may encourage overtrading. The increased frequency of price movements on a daily scale can tempt traders to act impulsively, entering and exiting positions too frequently. This behavior often leads to higher transaction costs and can erode profits, especially when trades are b✃ased on short-term market noise rathe🎃r than longer-term trends.

For these rea🙈sons, it may make more sense to sometimes take the big picture approach.

The Big Picture Approach

This big picture approach lowers noise levels considerably, allowing the weekly trader to see opportunities that are missed by short-term players flipping through their 澳洲幸运5官方开奖结果体彩网:daily charts at night. Admittedly, these trade setups require patience 🌱and self discipline because it can take several months for weekly price bars to reach actionable trigger points.

However, higher reward potential makes up for this lower activity level, while total work effort allows the trader to have a real life away from the 澳洲幸运5官方开奖结果体彩网:financial markets.

Using Weekly Charts

Weekly charts utilize specific 澳洲幸运5官方开奖结果体彩网:risk management rules to avoid getting caught in big losses:

1. Lower 澳洲幸运5官方开奖结果体彩网:position size and avoid the overuse of margin. A few hundred shares will do the work of a thousand or more when you let prices travel many points before taking your profit or loss.
2. Be selective in position choice. As a general rule, highly capitalized equities and the most popular 澳洲幸运5官方开奖结果体彩网:exchange-traded funds (ETF) generate better weekly trades than 澳洲幸运5官方开奖结果体彩网:small cap darlings or high flying biotechs that can drop 30% to 50% after an adverse FDA decision.
3. Focus on the edges of long-term ranges and moving averages. Opening a weekly trade in the middle of a 15- or 20-point sideways pattern is a sure-fire way to lose money, while buying a pullback to the 50-week EMA can produce outstanding results.
4. Respect the power of 澳洲幸运5官方开奖结果体彩网:opportunity cost. The capital you set aside for a weekly trade that lasts several months cannot be used for a higher reward setup that magically appears while you are managing the other position.

Feel free to add fundamental techniques to your weekly technical trade criteria. For example, solid earnings growth will increase your confidence when buying a stock that is nearing a weekly support level after a sell-off. Moreover, dollar cost averaging can be utilized aggressively, adding to positions as they approach and test these action levels. But do not get blinded by the 澳洲幸运5官方开奖结果体彩网:company’s balance sheet if support breaks because you will need to take your loss aggressi🅘vely.

A Historical Example

Let’s look at an example from the past using four weekly trade setups carved out by 澳洲幸运5官方开奖结果体彩网:Powershares QQQ Trust (QQQ). Note that 🤪these numbers are historical are 💫do not reflect live or current prices.

The fund entered a weekly 澳洲幸运5官方开奖结果体彩网:trading range, with support near 85 in November. It rallied above 90 at the start of the next year and sold off, returning to long-term range support in April. Weekly traders could build low-risk positions at that level (1), ahead of a 7-week bounce that added more than 7 points. In addition, a second 澳洲幸运5官方开奖结果体彩网:buy signal erupted when it rallied above January resistance (2), favoᩚᩚᩚᩚᩚᩚ⁤⁤⁤⁤ᩚ⁤⁤⁤⁤ᩚ⁤⁤⁤⁤ᩚ𒀱ᩚᩚᩚring a new entry or continuation of the first position, which is now held ꦉat a substantial profit.

The steep October slide set up a third weekly trade entry when it descended to support above 91 (3), created by the June breakout. That level also aligned perfectly with support at the 50-week 澳洲幸运5官方开奖结果体彩网:moving average, significantly raising odds f✨or a bullish outcome. The fund went vertical off that support z💎one, testing the yearly high and breaking out into year’s end. A final buy signal goes off when it breaks out into triple digits in November (4).

April and October pullbac𒐪ks into weekly support (red circles) raise an important issue in the execution of weekly trades. Both declines violated support mid-week and bounced, closing Friday’s session above those contested l🍎evels.

The Bottom Line

Tradin🎐g with weekly charts allows traders to focus on long-term trends, helping to avoid the short-term volatility and noise seen in daily price movements. By concentrating on broader market directions, traders can make more informed decisions that align with the overall market momentum. This method also minimizes the influence of high-frequency trading algorithms that often distort daily charts, providing clearer signals for trade planning.