Trading ChartsSuccessful trading is all about careful analysis and observation. Although trading at times can be attributed to luck, most of the time, careful evaluation is the key to become more successful in the trading markets. One of the most important would be the ability to read the different trading patterns.

Trading markets seem to be governed by certain patterns that happen depending on the current market factors and environment. These patterns, if accurately determined, can help traders predict the resulting instances based on the patterns observed. Having this knowledge can greatly help traders make better and more accurate decisions about their succeeding moves. Almost always, such patterns tend to repeat itself again and again. Here are some of those patterns to look out for.

Bunny Slopes

When evaluating trading charts, one may sometimes encounter seeing bunny slopes. These are the price movements on certain equity that seem to go up and down a couple or more points for a certain period. There is no noticeable increase or decrease on the price or value.

With trading opportunities usually appearing during sharp price increases as well as declines, bunny slope patterns on the charts may not be considered as something conclusive for most traders. But even such patterns may help give traders some bit of valuable information. If bunny slopes come after a volatile situation where price is on a steep decline, a bunny slope pattern may show traders that the drop may be on the verge of leveling off.

Changes Between Moving Averages

There are times when the charts show some price action happening at or in between large moving averages. Although such instances may eventually yield certain trades, it might be best to stand aside for awhile.

Conflicting Patterns

When different time frames seem to show conflicting patterns, this instance can put traders in a bad position. It may allow traders to easily miss out the support or resistance that can screw up the trade. Some may be tempted to engage trades when seeing such patterns, but the unpredictability may cost more than what may be earned sometimes.