All financial assets listed on the markets show trends. Despite what some investors may think, not only is divided into bullish or bearish. Of course not, because laterality is also a trend. Even if it is not to define oneself to undertake ascents or descents. But ultimately it is another kind of trend and very important to define the strategy that you are going to carry out in the financial markets.
The first lesson in any medium or small investor is to detect the trend of values. It will be of special importance so that you can make your savings profitable from now on. Because in effect, you will know what you have to do and use a series of tools so that your operations can develop with greater success. You cannot forget if you do not want to make more mistakes than necessary since it is a serious mistake that some investors make.
Such is the importance of a trend that will be decisive for opening or closing positions in the equity financial markets. We cannot forget that they will give the correct signals to open an investment strategy, in one sense or another. To such an extent that it can make you earn a lot of money in operations. Or in the worst case, limit losses when the most adverse conditions occur in the financial markets. Because, in addition, they do not require special training on the part of the users in this kind of operations.
Bullish trend: buy stocks
There is no doubt that the uptrend is one of the most beneficial for the interests of small and medium investors. Because in effect, it will be the one that provides the guidelines on the decision that will have to be made in the coming months. Not surprisingly, in any upward trend, buying shares is an operation that you can carry out with greater control of risks. In particular, due to the high upward trajectory that a security or financial asset can present.
In addition, there is a figure in technical analysis that can be even more beneficial for your interests such as the so-called free raise. For a very special reason and that resides in that the selected value will no longer have any more obstacles along the way. That is, ha exceeded all resistance levels that has been presented to him during his evolution in the quotes. To the point that it has all the way clear at the top, with no apparent limits that can slow down its price.
In any uptrend there is always a strategy that can help you achieve your goals with greater clarity. It is fundamentally based on buy at low peaks where they quote their prices and sell the maximums. To the point that you can strengthen your positions in equities with greater guarantees of success than through other stock exchange procedures. With the important advantage that you will not need special learning to detect these entry and exit levels in the stock markets.
Bearish: preserve savings
During the configuration of this trend, you will not seek a return on your savings. Of course not, but on the contrary your main objective is to protect your monetary contributions. And one of the most effective ways is through a loss limitation. Nothing less than losing less money than what the equity market can dictate. In these cases, it is a very prudent measure so that you do not lose as much capital as what will have been spent on more than one occasion. Even using a stop loss order so things don't get worse.
Like there is a free rise, in the downtrend the free decline is also present. One of the most unfavorable scenarios that you can find in technical analysis. And that can make you lose more than half of the assets invested in equities. If you detect it, you should leave quickly and without any excuses. Not surprisingly, it is the most practical thing you can do from now on. Its bearish run is very high without any support during this run. You will have no alternative but to sell your shares if you do not want to see yourself in a much more dangerous situation than the one before you.
Unlike the uptrend, in this there are no alternatives to develop any kind of investment strategies. Just sell, sell and sell. The only thing there is a small difference in is when it is formalized. Because in effect, you can take advantage of a rebound to get away from the equity markets. Perhaps with a better sale price than expected when the fall in prices originated. In any case, you should not pay attention to these scenarios to try to take advantage of the low prices that the shares of the securities bring.
How to give truthfulness to the uploads
Another problem that you may encounter from now on is what are the parameters that will certify that the upload is an incontestable fact. Well, basically two and one of them is if the increases are accompanied by a significant increase in your recruitment volume. If this is really the case, it will be a sign that the climb is serious this time. To the point that you will be in a position to open positions in the financial markets. With heavy purchases if possible.
The other technique is represented by the fact that the highest and lowest increases are increasing at the close of each week. It will be another of the clues that the stock market will provide you on the trend of a security or financial asset. As long as it is not uncertain, it will be that it remains vigorously under the upward trend. It can last a few weeks or, on the contrary, it can last for a very long period of time. In any case, will never go on forever since equities are dominated by continuous trend changes. Although they can have a different duration, depending on each specific case.
In any case, if confirmed, it will be an opportunity for you to make the savings more efficient. Because in effect, you have a high chance of not getting confused in the decision you have made. Consequently, you can hold positions As long as the maximums and minimums do not decrease in their weekly prices. Then it would be time to undo the positions and collect the capital gains. Despite the fact that rebounds can be generated in the prices.
Why is it so important to detect it?
It is highly recommended that you have this information with some anticipation. Enough so that you can develop it with the most convincing and defined strategy. Being aware at all times of the supports and resistances which can be exceeded at any time. With the intention of seeking profit or limiting losses, respectively. Because depending on this variable, you must use one or another strategy to optimize operations. We are going to be a movement that will help you defend your interests as a small and medium investor.
It is also very convenient that you analyze the technical analysis to verify which is the real value situation or financial asset. It will be a highly effective tool so that you can make the best decision to make your savings profitable. Because indeed, one of the best strategies in the investment world is to go in favor of a defined trend. In some cases, it will help you get extra money, and in others not to lose more contributions. If you heed these recommendations, you will surely optimize all your equities operations.
Traders' operations
Another aspect that you should keep in mind is that laterality is also a trend, although it may surprise you. With the only difference that it does not develop up or down, but maintaining very similar levels in its price. As a consequence of this action, it will be much more difficult to operate on the stock market. Where only traders will be in a better position to achieve their most desired objectives. With very fast operations and that even take place in the same trading session. It is something that differentiates them from other profiles of small and medium investors.
A very practical recommendation in these scenarios is that you can never go against the tide. Because indeed, if it is this way, you will have all the ballots to carry out some terrible operations that will materialize in large losses in your income statement. So you should take advantage of the bullish trends and choose the bearish ones to leave the financial markets. It is one of the most basic lessons for any investor, above other more complex or technical considerations.
As it has surely happened to you on more than one occasion, at times when a change in trend is generated, it will be the occasion for you to change your investment portfolio. To adapt it to the new scenario that is presented in equities. In a fast, analytical way and checking the intensity of the movements. All these actions can be viewed from the charts of the values, sectors and stock indices. It will be the best tool you have to operate on the stock market with the maximum guarantees.