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Writer's pictureLester Davids

Trading Strategy: Bearish Continuation

IGNITING BAR:

Bearish Continuation or AT/Near start of Bearish reversal


What does this strategy entail?


The instrument is in a short-term consolidation range or upward trend, from which a large red candle develops. This suggests that traders should: (2) TAKE NOTE of a potential change of trend and (2) TAKE NOTE of the start of potentially aggressive selling.


The tickers highlighted assume no existing position held by the trader while the setup is confirmed on the preferred candle structure developing during the upcoming session(s) i.e. follow-through.























MARKET NEUTRAL / PAIR TRADE IDEA: BUY SHARE 1 / SELL SHARE  2 


What does this strategy entail?


Simultaneously buying one instrument and selling another, which over the medium to long term have been closely correlated.


A successful pair trade can be realized in 1 of 3 ways: (1) The long position rises while the short position falls (2) The long position rises faster than the short position rises (3) The short position falls faster than the long position falls. Market Neutral Strategies can be seen as part of risk management within a broader portfolio.


Unum Trade is your Profit Partner, guiding you through each week’s market journey and strategies. To learn more, contact our Trading Desk team at tradingdesk@unum.co.za or call 011 384 2923.

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