How to recognize a Top stock market?

US stock market continues to be very strong because any withdrawal remains shallow and is quickly reached by buying the application. The current movement of increase was now intact for almost two months now (since mid-December 2011) without any major interruption. The market is overbought and vigilant but these concepts do not mean the market will be removed. So, how we can recognize that the market is close to a high or was a?

More important to look at, of course, is the price. As long as there is a series of highest peaks and lowest cards daily and hourly main indices of shares, the trend is higher and must be respected. But can derive more knowledge if they take a blow of eye in two other important factors:

() The tendency of the VIX (volatility) index. Usually the VIX is lower that the market is moving trend. Then with the approach of top, VIX began to be more volatile. For example, VIX suddenly passed last week (first commercial full week of February) 16-21. But generally the first rise of VIX is not the time where reverses the trend of prices. What can we expect to see, is another lower VIX to its most recent lows (about 16) and only the second or the third highest attempt will be accompanied by a reversal of trend in the stock. You can see the dynamics of VIX between May and July 2011 for the direction of what we can expect here.

() The second thing to look at is the stock participation in the rally that it is coming to its end. The rally exhausts itself, it is logical to expect less and less of stocks and sectors to participate. Thus, it is important to pay attention every week to the tendency of some important stocks and major ETFs of the industry (or the same country international ETFs) indices. Once you begin to see more stocks and ETFs short sale candidates as the advance of the main index, this means that the rally is in its final stages.

The current market, I'm beginning to see signs of weakening but a top of page is not there yet. I think that we need to see at least a drop more before a high VIX can be done. Indeed, the market should become low internal (i.e. less and less than stocks participated in advance) before can reverse the trend.

Alexander Nikolov has more than 12 years of experience in the field of technical analysis and is one of the technical analyst more renamed to Bulgaria. He is the founder and editor of http://www.trendrecognition.com/

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How to prepare for your first stock trade market

Step 1: Create an account with a broker

If you plan to make your own trades, your best option is to go with an online discount broker. They are much cheaper than the full-service brokers because they don't give you all additional services such as investment advice and other services, you are probably not. If you create your own stock picks, you have to pay just to trade.

Make a quick search online and you will find many options for online brokers. If you want to be a dealer in the short term, also known as a day trader, seeking a site which offers good trades markets if you trade frequently. If you intend to invest long term, look for a broker who specializes in the supply of affordable trade costs in the long term.

Step 2: Learn the ropes

If you are ready to trade, you can probably skip this step. If you have decided that you want to invest, but you don't know how, take your time on it. It is extremely important to know what you are doing, otherwise you will just to the game.

Go to the library or bookstore and seek to invest a few books. Make sure that one is at least more specifically on stock investment. Learn more about the stock market and what are the stocks, how to choose stocks and how to implement a strategy. This is the important documentation, you make the best choice of stocks.

Step 3: Put in place a strategy and choose your investments

Stock of investment is all about strategy, not any how simple or complicated, you make your strategy. Use the information that you have learned from step 2 to set your own strategy. Tips for investors as Warren Buffett success using to build a strategy that works.

Remember that no matter how large your strategy, there are always risks. Simply because a choice of stock turned evil does not mean you are a horrible investor and must surrender. Just group, adjust your strategy if necessary, and move forward.

Step 4: money

Put money aside for investing. It is essential to invest in the stock market because without it, you cannot buy investment. Start saving your income as soon as possible and continue to add money to your portfolio on a regular basis.

Step 5: purchase

The last step is to buy stocks and move forward. You have made your choice, now go to your brokerage account and make your trade. Continue to periodically monitor your investment, purchase and sale when you feel necessary. As time goes by, enjoy the yields.

Make your first trade is not that difficult. Cynthia can help learn you more about how start to invest in stocks and build your own strategy.

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