Trends are completely decisive movements to formalize the entry and exit of the stock markets. To the point that it will give you the signals so that you can carry out these operations with greater guarantees of success, as you will be able to check from now on.
Because in effect, they will generate more than one signal for you to invest the money without any rigor in connection with the strategies that you are going to apply henceforth. As an aid tool that will be very important for your next operations in the stock market.
Trend: bullish, the most desired
There is no doubt that the uptrend is the most desired by all types of investors. It is the one that is telling you that it is the most opportune time to open positions in a stock value. You will have the guarantee that you are always backed by the strength of the buying positions over the sellers. It is the ideal setting to strengthen your positions in the stock market. For all periods of stay: short, medium and long term. Until the evolution of prices gives some sign of weakness. It will be the moment in which you must undo the positions.
The uptrend also it is very easy to recognize and you do not need special knowledge or contributions from an outstanding financial culture. Because effectively, you can identify it with great simplicity and at any time. These are the scenarios where you should take advantage of to invest your savings, even with more aggressive purchases than usual. So that from now on you can use any type of strategy to make your assets profitable in a very optimal way.
Buying strategies
Whatever the case, purchases must be made in an orderly and disciplined manner. You must take advantage of the best purchase levels to make the most of the operations. Because purchases must not materialize at the highest levels of your listing. Of course not, but you have to do it at the lower levels of the charts. So that later he bandages them in the highest part of the movements formed. It will be a strategy that will give you great success from now on.
In spite of everything, one of the mistakes that small and medium investors usually make is to carry out these operations the other way around. Namely, buy the shares at the highest levels and therefore hinder any movement to make savings profitable. Whatever the case, it is an action that you should avoid so as not to find yourself immersed in a situation that is very unwanted for your personal interests. You should not fall for these scenarios if you want to make money in these financial markets. Don't forget it from now on.
Bearish trend, the most dangerous
It is undoubtedly the most dangerous trend you can find in the equity markets. Because It can make you lose many euros in each of the operations. On the contrary, it is a movement that can help you undo positions very quickly. Not surprisingly, it is a scenario that can last a long time and will have lethal effects on open positions. In this type of trend you should not trade, unless you are trading. In other words, you open and close positions in the same trading session. Even though to apply this unique investment strategy you must have a high experience in this type of operations.
Of course, it may be the possibility for you to get involved in the reverse operations. Or in other words, making sales on credit when you think that a security still has a long way to go. This is a class of operations that involves more risks. Where you are in the best position to earn more money on the stock market. But for the same reason you can lose a good part of your financial contributions. Because this is one of the reasons why this financial instrument is not suitable for all investor profiles.
It is always much more difficult to achieve capital gains in scenarios dominated by downtrends. You regularly have a high probability of losing money in this type of operation. At the same time, they are a scenario that appears with some frequency in financial markets. To this end, the intensity of this trend will be of special importance and may be reflected in the weekly closing of the securities selected to open positions in the financial markets. Either way, you should avoid trading this well-established trend.
Laterality is also a trend
On the other hand, there is a third scenario that you also have to take into account. It is about the lateral movements of the actions. Because indeed, many investors think that it is not a trend, but in reality it is. Is when moves under very narrow margins that make operations difficult for you. Because there will not be enough space to materialize successful sales. Where it will be much more difficult to get great benefits in each of the operations that are carried out. But what matters is that it is a trend and as such it must be understood to use any type of investment strategy.
This is one of the shorter trends in its degree of permanence. It rarely exceeds periods of one or two years.. Because the ultimate goal of laterality is to define oneself in one way or another. In other words, it breaks to go up or down and for this the evolution of its prices is focused. Once you've achieved this goal, that's when you truly drop the sideways trend. Whatever the case, one of the main characteristics of these movements is that they end up boring small and medium investors. Among other reasons because they do not know for sure what to do in these special situations.
What can you do with the trends?
- It is one of the most important keys so that you can restructure your portfolio on a certain moment. It will be useful to add or delete the values most likely to import this type of investment strategy. At the same time, it will improve the profitability of the positions opened until then.
- Each of the trends will have a totally different treatment. It is something that you have to take into account to make your savings profitable with greater guarantees of success. Whatever the case, always with great discipline in your actions in the financial markets.
- No trend is eternal in time, quite the opposite has an expiration date. It is a factor that you must anticipate in order to carry out the most appropriate strategy at all times and vary your lines of action in the stock market,
- You cannot forget that there are values in all the indices that are immersed in any of these trends that we have previously explained to you. So that you can operate with these financial assets in at any time and situation. You will never lack proposals of these characteristics.
- Before investing your savings you will have no choice but analyze the trend in which the value chosen to take positions is located. But also the general trend of the stock index to which it belongs. Not in vain, it will help you to carry out the operation in the markets with greater confidence in the final results.
- You must not forget that trends will be sold out some day. And therefore you must be ready to change your investment strategy. It will be a tactic that will improve the results of all your operations, regardless of the period of permanence to which they are directed.
- While your investment portfolio stay under the guideline of an uptrend You will not have to fear at all about the state of your accounts invested in the stock markets. It will be a very reliable signal of what can happen to you from the moment you buy shares.
- In short, it is a factor that must always be taken into account when starting your positions in the stock market. Above other technical and fundamental considerations. To the extent that it is the element that you should value the most in these situations. Both in purchases and sales. You will have gained more security in each of the operations made.
