Wednesday, February 22nd, 2012

Pattern Trading






Pattern recognition for systematic profits

The primary method Investor City employs for short to intermediate-term trading profits is known as pattern trading and falls within the field of technical analysis. It is our belief that the primary driver behind market prices is human psychology and that human nature does not change. Therefore, we opine that the emotions of fear and greed are repetitive and manifest themselves in financial markets at all degrees of trend.

Make money by learning to “See” the market

As one learns to better identify these repetitive patterns he can begin to use them to exploit trading profits with an amazing degree of accuracy. While we believe these patterns are predictive in nature and can help one anticipate future market direction, pattern trading is by no means an exact science. Patterns will fail, just as all other methodology for determining buy/sell decisions have their inherent shortcomings.

However, when price patterns are coupled with proper risk and money management, we believe one gains a significant advantage over other market participants who rely solely on traditional fundamental and technical analysis.