Joe Ross
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This question was sent to me from one of our students: Hey Joe! What can I hope to learn from viewing long-term charts?
The longer term charts can be very revealing, even if you are a shorter term trader. Longer term charts are educational, and definitely help you see things in perspective. Pay attention to what you see, and analyze in accordance with the following questions:
Note the yearly ranges for the commodities you trade. What is this yearly high and low, are they higher highs, lows and closes compared to last year? Does the close confirm price action? What is the long term trend? How does this years range compare to last three years' average range? Should next year have greater volatility than this year? How much in dollars was the price move from the annual lowest low to highest high? How much did you take out of that range? What should next years high and low be for the commodities you trade based on the yearly trend analysis? These questions define the yearly long term price bars, use the monthly price bars to answer them. Use weekly price bars to answer major trend questions for monthly highs and lows.
The longer term charts can be very revealing, even if you are a shorter term trader. Longer term charts are educational, and definitely help you see things in perspective. Pay attention to what you see, and analyze in accordance with the following questions:
Note the yearly ranges for the commodities you trade. What is this yearly high and low, are they higher highs, lows and closes compared to last year? Does the close confirm price action? What is the long term trend? How does this years range compare to last three years' average range? Should next year have greater volatility than this year? How much in dollars was the price move from the annual lowest low to highest high? How much did you take out of that range? What should next years high and low be for the commodities you trade based on the yearly trend analysis? These questions define the yearly long term price bars, use the monthly price bars to answer them. Use weekly price bars to answer major trend questions for monthly highs and lows.
