What are Stock Patterns?
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I drill the need to focus on only the best stock market patterns to my trading challenge students every single day so that begs the question, what are stock patterns, exactly, and why do they matter?
Patterns are just what they sound like: predictable ways in which stocks perform. By beginning to identify patterns in stocks, you’ll be able to improve your trading and gain an edge which can help you become a more profitable trader…even though this is NOT an exact science so never think any pattern will be the exact same as before…although patterns like these are eerily similar as you’ll learn if you trade penny stocks long enough!
Here are some things to know when looking for the best patterns in penny stocks, reading this new book and memorizing this free guide will help you a lot too.
1. History repeats itself. When it comes to trading stocks, you don’t have to reinvent the wheel every single time you trade. As you begin to gain more prowess as a trader, you’ll start to identify distinct patterns that characterize a stock’s movement that can help your trading. Basically, exploring the question of “what are stock patterns?” can make you a better trader.
Now, when I say that history repeats itself, though, that doesn’t mean it’s exactly to the letter. There will be slight differences. This means that you always have to be on your toes. What you’ll begin to see is that patterns emerge, but they are always a little bit different. This means that instead of looking for the same exact things, you’ll really begin to identify markers that can help you choose the best stocks to trade.
2. There’s not just one type of pattern. As referenced above, there’s not just one type of pattern. There are many different types of patterns that can occur in the stock market. While in one regard they’re truly like snowflakes (no two are ever quite the same) there are some distinct types of patterns that I’ve identified over the years. Some of these include the Dip Buy, Push-Through, Daily Breakout, and more. I share these patterns with members of the Tim Sykes Million Challenge team so that they can begin to understand and identify them themselves.
Once you begin to understand a few basic types of patterns, you’ll be better able to work this knowledge to your advantage.
