FXCM Research Team

The U.S. and world markets are in the midst of another presidential election year, as of this writing (August 2016). The election-year rhetoric from candidates and their partisan supporters has ramped up to a din capable of bringing confusion to all but the most attentive and dispassionate observers. Analysts like to note that investors don't like uncertainty. However, with a divided U.S. electorate and candidates disposed to fight tooth and…

Among visual chart patterns, the head and shoulders pattern has gained status among the most reliable predictors of future price action.

Technical analysts can use simple geometric patterns such as triangle chart patterns to unveil signals that can indicate where the market could go next.

The rectangle pattern is a common and easily identifiable formation on charts when prices momentarily move into range-bound behavior.

The channel is a simple and effective technical analysis tool for charting and trading on a price trend. Channels can be used to identify a trend and the possible points of a reversal or a price breakout to a different trading level. What Is A Channel And How Is It Identified? Channels are customarily created by pinpointing the upper and lower limits of price action within an ongoing price trend…

The evening star is the name for a classic bearish pattern appearing in candlestick charts that signals the end of a price uptrend and the beginnings of a downtrend. The pattern appears at the climax of a trend as a cross-like star formation. It's often used to identify a selling opportunity upon a reversal or help traders prepare for further selling opportunities as a new bearish trend gains momentum. Candle…

A pennant is a triangle-shaped chart pattern formed by consolidating price action following a directional market move or trend. Pennants are classified as continuation patterns, meaning their presence acts as a signal that the market is merely taking a pause, and the preceding trend has a good chance of extending its range in the near future. Market Conditions In general, chart patterns have the most predictive value when they exhibit…

In the realm of technical analysis, a "flag" is a chart pattern that illustrates a temporary pause or compression in directional price action. A flag is classified as being a "continuation" pattern, suggesting that price is likely to resume movement in concert with a previously defined trend. Flags are widely accepted by long-term, swing and intraday traders as signals of potential breakouts. In addition, they provide technical traders a means…

In the financial marketplaces of the world, there are numerous different styles and trading methodologies employed with the goal of achieving profitability. One of the most prominent forms of trading used by both retail and institutional traders alike is known as "scalping." Scalping is a trade management strategy in which the trader elects to take small profits quickly as they become available within the marketplace. Often referred to as "picking…

In a not-so-distant past, investors who were interested in pooled investments commonly purchased mutual funds, where they could capture the returns of a diversified portfolio using a single investment vehicle. Those funds, however, came with some limitations, among these the fact that positions in them can normally only be adjusted after market hours according to their net asset value (NAV). In more recent years, a new type of pooled investment…

Dark pools are networks of privately held trading forums, exchanges or markets that provide a platform for the anonymous trading of securities. Dark pools facilitate non-exchange-based trading practices between broker-dealer firms and investors interested in placing orders for the trade of specific securities outside of public scrutiny. Dark pools are also referred to as "dark pool liquidity" or "dark liquidity." Purpose Of Dark Pools The main objective of a dark…