Algo trading uses automated systems to execute trades based on pre-defined conditions, reducing human emotions in decision-making. Key Points: Uses high-speed computing and mathematical models to trade. Includes High-Frequency Trading (HFT), where trades are executed in milliseconds. Common in institutional…
The Bottom-Up Approach focuses on analyzing individual companies first, rather than starting with macroeconomic or industry-wide trends. This method is based on the belief that a well-performing company can outperform its sector or even the broader market, regardless of economic…
The Top-Down Approach begins with a broad analysis of macroeconomic factors before narrowing down to specific sectors and finally selecting individual assets (stocks, commodities, or currencies). It is based on the idea that overall economic conditions significantly impact the performance…
Scalping is an ultra-short-term trading strategy that focuses on capturing small price movements within a very short time frame, often lasting seconds to minutes. Scalpers aim to make dozens or even hundreds of trades per day, accumulating small profits that…
Position trading is a long-term strategy where traders hold positions for months to years, focusing on major market trends. It is similar to investing but involves active monitoring of economic conditions, sector performance, and macroeconomic indicators. This approach is less…
Intraday trading, also known as day trading, involves buying and selling financial instruments within the same trading day to take advantage of short-term price movements. Unlike scalping, which involves very quick trades, intraday traders hold positions for minutes to a…
Position trading is a long-term strategy where traders hold positions for months to years, focusing on major market trends. It is similar to investing but involves active monitoring of economic conditions, sector performance, and macroeconomic indicators. This approach is less…
Position trading focuses on long-term market trends, with trades lasting several months to years. The goal is to capture major price movements rather than short-term fluctuations. Key Points: Similar to long-term investing but involves active monitoring and adjustments. Relies on…
Dow Theory, developed by Charles H. Dow in the late 19th century, serves as the foundation of modern technical analysis. It provides traders with a structured approach to understanding market trends, price movements, and investor behaviour. Though Dow never formally…