In This Issue

Beyond Day Trading

Chart Patterns

Economic Calendar

September 23rd, 2009 - Issue #499

Special Feature: Beyond Day Trading

by the Cannon Trading staff

There are three distinct trading styles that can be implemented in trading futures:

1. One can "scalp" the markets in attempting to capture very small, quick profits.
2. One can trade market "swings" that last one, two or several days and attempt to profit from moves of a larger nature.
3. And, traders can trade from a long term perspective, trying to secure profits from large movements in price over an extended period of time, which could be weeks or months in length.

All three styles have their proponents. All three have advantages and disadvantages. What is key is that the trader pursues the style of trading that BEST fits his or her personality, strategy and intended discipline.

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Educational Spotlight: Chart Patterns

Occasionally in our newsletter, we will feature various tools that we feel may be helpful to you as a trader. This week, we'd like to encourage you, especially if you are a day trader, to take a look at E-Futures Chart Patterns.

Learn about 20 of the most common chart patterns, how to identify them, and what they may mean for your trading.

Sample: Broadening Bottoms

A broadening bottom is a chart pattern that can occur on an downward trend. It is generally classified as a reversal pattern but some traders argue that there is approximately a 50/50 split between whether it tends to move upwards or downwards upon completion of the pattern. For this reason, it can often be avoided by traders. It can be viewed as the opposite of a symmetrical triangle.

How Do I Recognize a Broadening Bottom Chart Pattern?

A broadening bottom is comprised of diverging support and resistance lines and resembles a megaphone. The rising resistance line and falling support line continue until the trend reverses.

See the example below:

What Does a Broadening Bottom Chart Pattern Mean?

This is a less common chart pattern pointing to a highly unstable market. As support drops and resistance rises, volatility increases.

Register now! Other chart patterns include:

Double Tops
Double Bottoms
Flags
Pennants
Head and Shoulders Tops
Head and Shoulders Bottoms
Triple Tops
Triple Bottoms
Broadening Tops
Broadening Bottoms
Ascending Triangles
Descending Triangles
Symmetrical Triangles
Cup and Handle
Diamond Tops
Diamond Bottoms
Rectangle Tops
Rectangle Bottoms
Rising Wedge
Falling Wedge

E-Futures Chart Patterns are part of E-Futures Private Content. Register now and receive lifetime access for free!

Economic Calendar

Source: Moore Research Center, Inc.

* Please note that the information contained in this letter is intended for clients, prospective clients, and audiences who have a basic understanding, familiarity, and interest in the futures markets.

** The material contained in this letter is of opinion only and does not guarantee any profits. These are risky markets and only risk capital should be used. Past performances are not necessarily indicative of future results.

*** This is not a solicitation of any order to buy or sell, but a current market view provided by Cannon Trading Inc. Any statement of facts herein contained are derived from sources believed to be reliable, but are not guaranteed as to accuracy, nor they purport to be complete. No responsibility is assumed with respect to any such statement or with respect to any expression of opinion herein contained. Readers are urged to exercise their own judgment in trading!