The beauty of the futures market is that it is very similar to the principle of economics - demand and supply. If there are buyers for a particular stock or commodity, the price will rise and if not, it will fall. But the impression of many individuals who enter this market and feel that they can do some futures trading to make quick money needs to be viewed with skepticism and as many individuals would have found out, that impression is far from the truth.
However, there are advantages of futures trading in the sense that there is no physical delivery of shares and you are allowed to hold on to your position or get out of it before the contract term. That flexibility is indeed a great help and the fact that you can trade in a much larger quantity of shares by just paying some margin money is the main reason why many people buy and sell futures.
Now if you have to trade successfully in futures, you have to follow certain trading techniques that are based on mathematical models or charts. There is no point in trading just based on gut feel as you can lose money easily. The importance of charting in futures trading is as crucial as it is in physical trading of shares and it would be useful for you as a regular trader in futures contracts to be aware of the various line, bar and candle stick charts.
It has been found that the candle stick chart is usually the more referred to as it gives a quick snap shot of the performance of a stock during the whole day. Line charts are preferred when you have to look at the hourly movement of a particular stock.
It is obviously not very easy to pick up the nuances of charting and its various models all at once. The recommendation is that you pick up any one of the chart models and try to learn the maximum about it to the point of implementing it practically in your trading. That will actually tell you how well you have managed to learn that particular charting technique.
Once you get accustomed or are good at following a particular charting technique, stick to it and do not try to incorporate styles that are new to you. The fact that you find a particular chart style suitable to your trading indicates that you may have adapted to it far better and you must continue with it.
Article Source: http://EzineArticles.com/?expert=Francis_Jackson
However, there are advantages of futures trading in the sense that there is no physical delivery of shares and you are allowed to hold on to your position or get out of it before the contract term. That flexibility is indeed a great help and the fact that you can trade in a much larger quantity of shares by just paying some margin money is the main reason why many people buy and sell futures.
Now if you have to trade successfully in futures, you have to follow certain trading techniques that are based on mathematical models or charts. There is no point in trading just based on gut feel as you can lose money easily. The importance of charting in futures trading is as crucial as it is in physical trading of shares and it would be useful for you as a regular trader in futures contracts to be aware of the various line, bar and candle stick charts.
It has been found that the candle stick chart is usually the more referred to as it gives a quick snap shot of the performance of a stock during the whole day. Line charts are preferred when you have to look at the hourly movement of a particular stock.
It is obviously not very easy to pick up the nuances of charting and its various models all at once. The recommendation is that you pick up any one of the chart models and try to learn the maximum about it to the point of implementing it practically in your trading. That will actually tell you how well you have managed to learn that particular charting technique.
Once you get accustomed or are good at following a particular charting technique, stick to it and do not try to incorporate styles that are new to you. The fact that you find a particular chart style suitable to your trading indicates that you may have adapted to it far better and you must continue with it.
Article Source: http://EzineArticles.com/?expert=Francis_Jackson
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