Wednesday, June 2, 2010

Hanging Man and Hammers!



Trading Tip of the 
Week

Reading stock charts isn't always as easy as A, B, C. In
fact, a lot of times it's more like trying to decode some
ancient language in a foreign script. That's because, as
with many dead languages, CONTEXT is paramount -- and
that's especially true when comparing hanging men and
hammers
.


Hanging men and hammers are both single-candlestick
formations that have virtually identical characteristics.
However, one is bullish and the other is bearish. What is
the difference between the two? CONTEXT.


Even in the English language, there are times when a word
might mean one thing in one context and another in another
context. We're so accustomed to these double (or triple or
quadruple!) meanings of words, they've become second-
nature to us -- just as the contextual meanings of words,
phrases, and characters of ancient languages were second
nature to the people who used them.


Well, after studying this episode of TradingTips.com, the
contextual differences between hanging men and hammers
will be second nature for you, too!

Watch this week's episode now.

In this episode, you'll learn:
- The basic characteristics of a hanging man formation
(0:35)
- How to interpret hanging men and what factors increase
your probability of successfully trading them (1:09)
- How a hammer is similar to a hanging man -- and the one
key difference! (1:26)


In conclusion, it's important to remember that hanging men
and hammers
are not opposites -- they are in fact very
similar. Their only real difference has to do with the
CONTEXT in which they occur... And in this case, CONTEXT
is definitely everything!

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