Investors often fall into one of two categories: fundamentalists or technical analysts.
Fundamentalists rely on company fundamentals, like earnings, debt, price-to-earnings ratio, etc. This information is typically released in a company’s quarterly or annual statements. This helps an investor determine whether they should invest in a company.
Technical analysts rely on chart patterns to determine the proper time to enter and exit a trade. This helps answer two of the biggest questions investors have…
- When should I enter a position?
- When should I exit a position?
After more than three decades in the market, I’ve come to learn a secret… Fundamentals and technicals shouldn’t be so polarizing – both have a place in successful investing.
After all, it’s not enough to know just whether you should buy a company… You also need to know when to buy and when to sell.
And depending on your time horizon and investing goals, you may want to lean more heavily on fundamentals than technicals or vice versa.
You see, in my Wealthy Retirement Safety Net column and in The Oxford Income Letter, I lean heavily on fundamental analysis.
I look at metrics like income and cash flow to determine a company’s ability to maintain its dividend, and I also study the competitive environment to gauge stocks’ likelihood of rising.
This is often the best way to look at a stock’s viability for the medium to long term – and it’s a skill I honed while working at the contrarian firm Avalon Research Group.
But when I started my career as an assistant on a trading desk, executing trades and watching the “tape” for trends, I needed to find a way to help make sense of all the data flying across my screen. Thus, I began to rely on technical analysis and chart patterns.
Now I can’t imagine trading without them. Using chart patterns is the perfect strategy for anticipating a stock’s short-term movements.
A few of my favorites include…
- The bull flag pattern
- The head and shoulders pattern
- Ascending channels.
But what most people don’t realize is that there are inverses of these patterns that allow you to take advantage of downturns in share prices too…
- The bear flag pattern
- The inverse head and shoulders pattern
- Descending channels.
And if you can master just a few simple chart patterns – and their inverses – you can produce results that are unthinkable for most investors.
In fact, so far this year, I’ve used these three patterns to produce four triple-digit winners for subscribers to my VIP Trading Research Service Technical Pattern Profits despite the broader market being down around 19%.
Because utilizing it is as easy as counting to nine.
It harnesses tiny but potent “micro-bounces” in falling stocks.
That’s why I’ve put together a new investment series for you. I’ve prepared a special free presentation where I explain this pattern.
And I’m so confident in Project 9 that – for the FIRST TIME ever – I will be trading my own money alongside Members.