What is the Traders Action Zone?

The Traders Action Zone (TAZ) is a buy and sell zone on a stock chart that swing traders can use to identify possible reversals in a stock.
First of all, let's take a look at all of the different types of traders involved in the stock market when looking at a daily chart.
Then, we will look at where they buy stocks. We'll focus on the long side only.

Position Trader

This type of trader is looking to hold stocks for long periods of time. They buy stocks that are first breaking out of basing patterns into a stage two uptrend. This is likely where you will see institutions buying stocks. This buying pressure is what starts the uptrend. They are hoping that the next two groups of buyers will push the stock higher.

Momentum Trader

This type of trader buys stocks that are, well, showing momentum! They buy stocks right after a major move in a stock and hold for a short period of time. They are hopping on a board a fast moving stock looking to capture short term gains quickly.

Swing Trader

This is where you come in! You are trading the swings within the trend. Here is a chart that may help you to better see how everything unfolds...

WHICH ONE SUITS YOU? STICK TO ONE AND PRACTISE EVERYDAY, SOON YOU WILL BE THE SURVIVOR IN THE MARKET!