Trading Stocks in a Bear Market

by CandlestickTrading on Oct 5, 2011

http:// www.CandlestickForums.com - Trading Stocks in a Bear Market

When trading stocks in a bear market, traders seek to profit from continued downward movement of stocks and from an eventual turnaround in stock prices.

When trading volatile markets, stock traders do well to use solid technical analysis tools such as Candlestick stock charts in order to objectively read market sentiment and avoid falling prey to the trading psychology demons of fear and greed.

When stock prices are falling, it can be profitable for those engaged in long term investing as well as those involved in day trading.

In both cases one needs to be able to anticipate when the market will bottom out. Both fundamental and technical analysis are necessary when trying to predict market trends and market reversal. Fundamental analysis commonly helps investors and traders understand the limits of stock price variation.

Technical analysis with Candlestick charts taps into market sentiment and provides an objective view of when the market will turn. When trading stocks in a bear market such as seems to be emerging today Candlestick analysis helps traders spot and capitalize on trading opportunities.

Trading stocks in a bear market can seem difficult when bad news follows the sun across the globe and market after market drops even before the NSYE and NASDAQ open for business. Many choose to sit on cash during periods of high market volatility.

But it is often in downward trending volatile markets where stock traders can find the best profits and those interested only in long term buy and hold investing can pick up the best bargains. Fears that the European Union will not be able to solve the Greek debt crisis and that a debt default by Greece will proceed like falling dominos to Italy, Spain, Portugal and Ireland have markets spooked.

The Dow Jones Industrials fell recently to their lowest in well over a year. The S&P 500 is down as well as the NASDAQ composite. The Greek government announced that it probably will fall short on austerity measures which were part of the bailout bargain.

The head of the US Federal Reserve recently spoke about shared responsibility of all policy makers in dealing the US economy, in a pointed reference to continual bickering on Capitol Hill. Meanwhile Candlestick traders follow technical price information and profit when trading stocks in a bear market.

Although traders are well advised to keep an eye on the news veteran traders know that the market quickly adjusts for the fundamentals. Smart traders can follow Candlestick pattern formations during these times in order to anticipate market swings.

Smart traders can avoid falling prey to market hysteria by consulting Candlestick patterns in daily trading. Candlestick trading tactics can be used to create profits when trading stocks in a bear market or any market. Candlestick trading gives traders an objective means of predicting stocks prices.

Wise use of Candlestick signals reduces the fear factor in trading. Whether on is trading stocks, options, futures, commodities, or Forex, Candlesticks are a good guide in a bear market.

All information on this website is for educational purposes only and is not intended to provide financial advise. Any statements about profits or income, expressed or implied, does not represent a guarantee. Your actual trading may result in losses as no trading system is guaranteed. You accept full responsibilities for your actions, trades, profit or loss, and agree to hold MinKL Invest harmless in any and all ways.