Point & Figure! (AMZN)
Richard O. Zamora, III; CMT • Feb 15, 2019
Using P&F charts to trade.
Often, your training as a trader can be grueling, demanding and formidable. It is only with hard work and determination that you can begin to unlock the “secrets” of how Technical Analysis interacts with the Market and offers rewards beyond imagination. Learning new ideas and disciplines within the field of technical analysis can be a lifelong pursuit; but it doesn’t mean that you cannot profit from new concepts (or old) and quickly understand how it fits into your way of trading.
Point & Figure Charting is one example.
Although no one knows exactly when this method of Technical Analysis was developed, it can be traced back to the late 19th century and was a form of analysis used by Charles Dow.
Although too vast a subject to begin to discuss here, I wanted to touch upon and mention some key ideas about it. Firstly, Point & Figure (P&F) Charting unlike all other forms of analysis – does NOT take time into consideration. The price action of a security is viewed and recorded only by its rise or fall. Secondly, the construction of a P&F chart is made up of X’s, representing an increase in price and by O’s, representing a decrease in price.
These X’s and O’s (Isn’t that a country song?) provide a visual representation of the price of a security. Traders who use P&F charts, will observe how these X’s and O’s form and how they respond to price change. Let’s look at an example.
As of February 15th, Amazon (AMZN) shows a column of X’s, representing an increase in its price. You can get a sense of how the stock has performed by noticing how it has been in a decline (look at how the X’s and O’s have been slanting downward). Now that we notice a column of X’s, we can hypothesize whether this is a change in trend to the upside or not. The question is: How do you determine if you are reading this P&F chart correctly? And, how do you begin to trade it?
I can help you answer that through consultation; contact me today!
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None of the content constitutes a recommendation that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person. None of the information providers or their affiliates will advise you personally concerning the nature, potential, value or suitability of any particular security, portfolio of securities, transaction, investment strategy or other matter. This website mentions Mr. Richard O. Zamora, III's trading expertise. This expertise derives not from managed futures but from Mr. Zamora's years of trading and education in the capacity as Principal and Managing Partner of Global Market Raiders LLC. and trades made on its' behalf; Global Market Raiders, LLC does not, at this time, provide managed futures accounts. Global Market Raiders, LLC, does offer, in addition to educational instruction to clients - general and personalized Technical Analysis reports and trading recommendations to retail and institutional clients. This website may contain language that some may misconstrue or find compelling to act in an urgent manner or to believe that there is an exaggerated likelihood of profitability; this is simply not the case, nor intended. Any call to action or perceived high pressure sales techniques are not intentional, misleading, or deceptive. No-one should feel compelled to act without further thought and due diligence. Any language contained herein, is simply made as to allow for a natural organic business flow. Finally, trading is a hard and tough business. There are no shortcuts or trading "black box" that will allow for profits without risk. The National Futures Association (NFA) as well as the Texas State Securities Board (TSSB) exist, among other reasons, to ensure that the public is safe from anyone or company that states otherwise. It is ALWAYS important for the public to research the individuals and companies that offer financial advice and services. And that is why, for your convenience, you will find links to these organizations along with Global Market Raiders, LLC.'s member registration numbers. We ardently invite you to examine us!