AUS200 - Bullish Counter Attack !
Hello, traders.
If you search the information about CFD, most people lost money when trading it. It is because this difficult to trade? I don't think so. The most common problem in my opinion lays on 2 factors. First is do not have solid trading plan. Second is do not have risk limit level.
The first factor talking about to forecast how market move based on solid information showing in your chart. Let me explain this using the AUS200 chart.
For your information, AUS200 have a beautiful chart pattern. Take a look at the chart. It is consistently making pattern up - sideways - up-sideways-up-sideways. And guess what, AUS200 now is sideways between 6578.9-6769.5. And just been broken this week. So, I expect the AUS200 will go up again to continue the market pattern.
Looking the current price action (how price move and behaves to the environment surround it), AUS200 struggled to break minor resistance (6849.5-6824.4) and this will make the price will go down again potentially to test minor support (6751.3-6712.5). But, do not forget AUS200 also has strong support there (6769.5 - marking with green line in my chart). So, market potentially go down to the supports and rebound from there when buyers into market again.
Regarding the probability (remember, trading always and always about probability). Whenever you see the chart, you always have to remember, that market moves in probability. And it is also possible that market can break down the support, and if this happen, then the "rebound" scenario I tell you above will be invalid. Therefore, as a trader in market we needs factors 2, that is risk limit level.
Riks limit level - second factor - talking about how much money you want to risk in market. In factor 1, we forecast when and how market moves. Then in second factor, we also forecast where market will go. In AUS200, my forecast is if price rebounds in support, then it will move again to go up to test the minor resistance (6849.5-6824.2) and after breaking it, it will then test the major resistance (6883.14 - red line) as my major target. From this forecast, I know how much reward (1.4%-1.9% increasing) I get if I buy on support. From this reward, I know how to measure my risk tolerance based on stop loss I set up overthere.
Risk limit level also help us as a added factor to place our entry level. Because everyone wants a lower risk and higher reward, so, if you already know technical knowledge and stick with your risk limit, you will be pushed to select the most entry level that suitable to the stop loss level that accommodate your risk limit level.
Alright then, I hope you can get the idea from this short tutorial I give to you. Happy trading.
If you search the information about CFD, most people lost money when trading it. It is because this difficult to trade? I don't think so. The most common problem in my opinion lays on 2 factors. First is do not have solid trading plan. Second is do not have risk limit level.
The first factor talking about to forecast how market move based on solid information showing in your chart. Let me explain this using the AUS200 chart.
For your information, AUS200 have a beautiful chart pattern. Take a look at the chart. It is consistently making pattern up - sideways - up-sideways-up-sideways. And guess what, AUS200 now is sideways between 6578.9-6769.5. And just been broken this week. So, I expect the AUS200 will go up again to continue the market pattern.
Looking the current price action (how price move and behaves to the environment surround it), AUS200 struggled to break minor resistance (6849.5-6824.4) and this will make the price will go down again potentially to test minor support (6751.3-6712.5). But, do not forget AUS200 also has strong support there (6769.5 - marking with green line in my chart). So, market potentially go down to the supports and rebound from there when buyers into market again.
Regarding the probability (remember, trading always and always about probability). Whenever you see the chart, you always have to remember, that market moves in probability. And it is also possible that market can break down the support, and if this happen, then the "rebound" scenario I tell you above will be invalid. Therefore, as a trader in market we needs factors 2, that is risk limit level.
Riks limit level - second factor - talking about how much money you want to risk in market. In factor 1, we forecast when and how market moves. Then in second factor, we also forecast where market will go. In AUS200, my forecast is if price rebounds in support, then it will move again to go up to test the minor resistance (6849.5-6824.2) and after breaking it, it will then test the major resistance (6883.14 - red line) as my major target. From this forecast, I know how much reward (1.4%-1.9% increasing) I get if I buy on support. From this reward, I know how to measure my risk tolerance based on stop loss I set up overthere.
Risk limit level also help us as a added factor to place our entry level. Because everyone wants a lower risk and higher reward, so, if you already know technical knowledge and stick with your risk limit, you will be pushed to select the most entry level that suitable to the stop loss level that accommodate your risk limit level.
Alright then, I hope you can get the idea from this short tutorial I give to you. Happy trading.
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