Stock Trading Strategy: A Better Understanding Of Pinging

Stock Trading Strategy: A Better Understanding Of Pinging Even traders that are successful sometimes do not adjust their trading styles as market conditions change ; they find one pattern in which they are successful much of the time and they just stick to it . When times occur when they lose because their style isn't market compatible, they accept the loss and say that that is the way the breaks go . They seem to think their stock trading strategy all possibly trade styles, but it's not the case .

If traders are able to figure out the market state, that is, the trading currently existing and the type of trading expected , their returns can be considerably improved. This is because one will never be applying trend trading techniques when congestion trading .

There are still those times when the state of the market is a bit ambiguous . Indeed if things were always clear there would be no market , since traders would not have opinions that were different, and trading in the same direction would be done by everyone all the time.

One such ambiguous state is when a trend seems to have exhausted its energy and is ready for a turn , and the indicators of momentum roll over and appear that they will go to congest entrance from trend . But the signals are not clear enough for the trader to go whole hog and initiate a large position .

When this occurs pinging can be used . Pinging is an attempt to hedge your bet a bit . A trader places trades of single direction in the direction they expect the market to turn , but does not hold them for long , and gets out at the first sign of lower time period support .

At turning points the market frequently manifests "pumping" action , with swings in both directions that are volatile and large as traders of differing opinions around the world take positions against each other . If a trader is "pinging" he or she can take multiple positions repeatedly as the market movement goes from support to resistance and then back. Rather than trying to ride the market both ways , and instead of putting a large bet on the direction you anticipate and then holding on , it is as if stock trading strategy to the trader that the market could be pinged , going with one direction only small positions, and being willing to quickly and early cover when short term support is reached by the price.

Significant profits can be a result of pinging and puts the trader in close contact with the market as this battle moves forward between the longs and the shorts. Traders will be protected from a too early by pinging, will allow profits to be brought in even when the market is confusing when the new direction is uncertain and the attempt to end a trend may fail . Pinging allows traders to get into a position so that when another trend comes in and is establish, he or she is already aboard . When seen correctly , stock trading strategy pinging as a market entering method when they aren't totally certain where the market will go next.

Ted Hearne is a Forex and bond trader who has written extensively about trading and has co-authored a "stock trading strategy" called "Drummond Geometry". His biography and further information about his work can be found at the stock trading strategy website.