Wednesday, June 14, 2006
Learn Online Forex Trading - What is Double Top??
Learn Online Forex Trading - What is a double top and a double bottom? How much reliable is it?
Before I start going through details about Double top, I need to share with you that I am very excited today..Why??
Yesterday when I was doing analysis of the charts of EUR/USD and GBP/USD for forex trading, my analysis said that market will bounce tomorrow because it has hit 38.2 fibonacci levels..And guess what it sure bounced..:-)
Now, the market did not bounce just because of technical reasons. There were fundamental reasons also..like Federal Bank's chief's speech, EUR inflation data etc..
Now, did I make any money?? No, since I was trying a different methodology for forex trading
and that technique didn't work..And of course I was trying this technique for forex trading on a demo account.
Now, lets come back to concept of Double Top and Double Bottom -
Look at the chart I have included. It highlights a classic case of double top.
Double top in online forex trading is a situation when in an uptrend, the market makes a high, then retraces and then touches the previous high again, but doesn't breaks it. It then is a signal that the market COULD be reversing.
The opposite is true for down trend. In that case it is called as double bottom.
In the chart, please see that EUR/USD made a hih, then retraced a bit and then hit the high again. and since it could not penetrate it, it retraced. So double top/bottom is an important concept in forex trading.
So, friends thats all in todays concept to learn online forex trading. Visit tomorrow again to learn something more.
