So you are starting out in trading and you have developed your stock trading strategy . You have gone through technical analysis training course and and for your preferred style you have gone with trend traing after some time in thought.

Trend trading is an attractive strategy for sure . Look at a stock chart retrospectively and the trending patterns jump out at you . You get excited about catching a trend in the beginning and riding it through to its final conclusion many months down the road . The money beckons and sucess is before you !

Unforunately, in reality, trading isn’t that easy. You enter a trend – you get in near the beginning or a bit late, but you do make it on board . Now that you are in the trade you move into a small profit as your predictions start to come true . Then a strong day comes along and after that then the market stops dead in its tracks as the stock hits resistance . You tell yourself there will be more and you couldn’t move everything in a day anyway and so you add to your position . But alas the following day the market opens up , goes absolutely nowhere, and then it starts heading down fast. Since you’ve added to the position you were in you head back to break even fast and then you take a loss by the time you get your orders in place . What happened ? How could you have know beforehand that the trend wouldn’t go on and that you should have taken the profit when the market started strong and then paused ?

The following are a few tips for trading that will let you know when a trend is going to go on and when it’s going to stop . If you apply these to your technical analysis training you will be well ahead of the game .

First of all : go with higher time period charge when setting targets; look for logical areas of resistance and support to figure out where the market is going to stop or start moving .

If you do not know how to predict where future areas of support and resistance exist , or within your trading are unsure of how to coordinate your time frames , then take a quality technical analysis training for some help . Drummond Geometry is one of the best but a variety of valid schools of thought exist .

Another element that is needed is a tool that will help you judget robustness and trend strenght. Resistance or support will be broken through by a strong trend and when a point or resistance or support is hit by a weak trend it will go into congestion or stop or it will reverse and move in the opposite direction . If you have the right tool in your analysis tool kit you’ll be able to figure out which action is more probable ; if you do not have the tools then you have to wait and see , and the possibility of being disappointed is high .

To appropriately measure, momentum tools should be used and apply them to a timeframe that is smaller than the one you are trading … basically if the daily chart is what you’re trading , with your trades try to pick the day’s high or low, then you would be looking at an hourly or half-hour chart to give you support in your trading decisions intraday .

We’ll talk about this more in part 2 of the technical analysis training series.

Last time in our technical analysis training series on Will the trend Continue or will it stop? we discussed how measuring the strength of a trend requires two types of tools , while helps you decide whether a trend is going to continue or stop. The first tool was the proper setting of targets according to the higher time period market structure of support and resistance .

Momentum tools are the second type of tool needed . To make appropriate judgments you should use momentum tools and apply them to a smaller timeframe than the one you’re trading … essentially if you’re trading on a daily chart, trying to pick either the low of the day or the high when trading, then for support for the intraday trading decisions you’d be looking at half hour or hourly charts .

What are momentum tools ? one of the best is a short term moving average ; use three moving averages in a channel system and you’ll then have a matrix that you can use to measure a trend’s strength. There are many channel systems but one of the most effective is the Drummond Geometry system ( more than likely you learned about this in a technical analysis training course) which as the center line uses a moving average that is short term of the average of the close, high, and low of the last bars that have been completed , projected onto a bar in the future . Then two channel bands are added to this based upon averages that are similarly managed on the previous three pivot points . Great market strength judgments can be made by monitoring where closes occur sequentially in relation to this system .

Market flow should be established by measuring using various aspects of price strength , such as how close to the high or low the close of the bar is , the distance between close and open , how small or large the bar range is, and how much progress the bar is making through your support and resistance matrix .

Another important tip : Because each time-frame has its own system of support and resistance , watch the difficulty or ease of in a trend the lowest timeframe monitor breaks its own support or resistance. The more easily you see this happen , the more robust the underlying trend is likely to be . Within an uptrend , support will hold if its close to the bar’s low, and resistance nearby is more likely to break easily. Resistance breaking and support holding in a lower time period- this is a sign that is reliable showing the strength of the trend.

These tips should help your stock trading strategy become a consistent winner as you learn how to distinguish between trends that are running out of steam and those that may go on for days, weeks, or months . A good course that sharpens your technical analysis training can save you a lot of time and money by providing you with the tools needed to make these distinctions, which are so important .