You’ve likely heard many of the potential dangers associated with the stock market: volatile energy prices, tightening credit conditions, slowing economic growth, inflationary concerns, and the possibility of further Fed interest rate hikes in the coming months. As a prudent investor, how can you help protect the value of your stock portfolio during periods of uncertainty and heightened market volatility?
A weak U.S. Dollar, global political uncertainties, and interest in “safe haven” investments have sparked renewed speculative interest in gold. Where gold prices will go from here remains unclear, but one thing’s for certain: Investors seeking new markets and opportunities, greater trading leverage, and portfolio diversification may want to consider gold futures!
Trend-following is among the most time-tested and potentially useful approaches to trading. Trading against the trend can be mentally taxing and difficult. By using trend following techniques, a trader can identify the major trend, trade with it, and stay protected with risk management tools.
During any market cycle, there will be leading and lagging sectors as well as industry groups within them. For bearish traders, the act of focusing on stocks in weak performing groups or sectors is one way to improve their probability of long-term success.
The overall market trend is important in bearish trading. It can be an extremely useful piece of information to have some ideas as to whether the current trend of the stock market – or any tradable asset - is presently bullish, bearish or neutral.
When thinking about establishing any trading strategy, considering your timeframe is very important. With Bearish strategies, however, it may be even more critical to your success due to the potentially unlimited risk involved.
Timeframe refers to the general duration of a given trade from the time the trade is opened to the time the trade is closed. The timeframe a trader selects is dependent on their overall trading strategy, motivations, and time commitment.
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