The Broadening Top pattern forms when a pair price makes higher highs (1, 3, 5) and lower lows (2, 4) following two widening trend lines. The price is expected to move up or down past the pattern depending on which line is broken first. What distinguishes a Broadening Top from a Broadening Bottom is that the price of the pair is rising prior to entering the pattern formation.
This type of formation happens when volatility is high or increasing, and when a pair’s price is moving with high volatility but little or no direction. It indicates growing investor nervousness and indecisiveness.
If the price breaks out from the bottom pattern boundary, day traders and swing traders should trade with a DOWN trend. Consider selling the pair short or buying a put option at the downward breakout price level. To identify an exit, compute the target price by subtracting the pattern height from breakout point. The pattern height is difference between the pattern’s highest high and its lowest low.
The barbell strategy divides a sum, for instance $10,000, equally among bonds with short durations and bonds with...
Shareholders of a company are part-owners of the company, and they are entitled to two things: voting for board...
Financial stocks are those that make up the financial sector, which encompasses banks, lenders, wire houses, and others
The secondary markets are where most trading goes on today, where the trades are made investor-to-investor using shares
The current ratio is a measure of a company’s liquidity, calculated by dividing current assets by current liabilities
Accommodative monetary policy is when a central bank makes it easier for banks and consumers to borrow money
On the spectrum of creditworthiness ratings that come from firms like Moody’s and S&P, a rating of AA+/Aa1 is very good
The commodity-products spread is the difference in prices between a raw material and a product made from it
A Dividends Received Deduction (DRD) is a tax deduction available to corporations when they are paid dividends from...
Open-source software code can be viewed and changed by anyone, but it actually works in the favor of cryptocurrencies