Trade The Journey

Trade The Journey

Bulls vs Bears

They are both teams in the same city but in different sports. The Chicago Bears and Chicago Bulls. Both mean different things to different people and they both are important in the sports fans lives.

Bulls and Bears are also known in another place and that is in the stock market. Its meaning reverberate to all members of society. Some root for the bulls and some depend on the bears. But as sure as the suns sets and the sun rises, there will be bull and bear markets.

For example, the stock market is known to be an indicator of the economy, it is not the economy. Which is why there could be a stock market collapse like the dot.com bubble that did not affect the economy? Bulls and Bears should be thought of like supply and demand.

When there is more than enough for everyone, we value it less and when there is not enough, we value it more. The classic principle of supply and demand which also affects prices in the stock market. Learning the candlestick charts has helped me to better visualize the markets and what is happening. I can match the news events and various indicators with what I am looking at in the candlestick charts.

There are many options on the internet to learn about the candlestick charts and what they mean. So I won’t ruin it for you here. It has been interesting learning about the patterns that can be formed using the candlesticks and what can be inferred by matching the patterns with volume.

A low trading volume and rising asset price can mean that the asset could be losing momentum. The supply of the asset is increasing and less people are buying which could spell a reversal. The opposite is true as well.

We are all speculators in some respect and there are a lot of ways to profit from objectivity when viewing an asset. The most important part that I am learning to rememberĀ is that in each price fluctuation, bulls and bears are fighting for control. Knowing the fundamentals is a great thing but to better observe the bulls and bears, being technical can definetly help.

Thoughts?

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