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Spotting Tops & Bottoms Before It Happens
by Jason Ng, Jas

Spotting tops and bottoms before it happens is definitely the Holy Grail to making a fortune in the capital market. Traders have been trying for ages to devise such a trading method. It doesn't matter which market you are trading; Forex, Options, Futures or Commodities, you can make a fortune as long as you are able to sell before prices start dropping and to buy just before prices start rising.

The problem is, is it even possible?

Is it possible to tell when a car is going to stop when the driver's foot is still on the accelerator? Is it possible to tell when a thrown ball is going to fall when it is still rising strongly? Of course not! At least not with any degree of consistency or confidence.

If there is a way to predict exactly when a stock would start turning around, why is Jim Kramer giving it away as a free report? Let's face it, anyone who tries to predict the stock market has been rewarded with nothing but disappointment. “Top analysts” trying to predict and call a bottom to the stock market has been rewarded only with more downside and losses. “Top analysts” trying to predict and call a top to the stock market has been rewarded time and again with nothing more than a total loss of profits as they sell and watch the market go higher and higher.

So, can we now agree that there is no way to “Predict” when the market will hit a top or bottom before it actually happens? Ok, good.

Now, as a professional hedge fund manager and options trading mentor, I have made a good living from sell near the tops and buying near bottoms, so, while I cannot predict when a top or bottom would occur, I could certainly tell when it has begun to do so for real and then take early action. This means that while one could not spot a top or bottom BEFORE it happens, one could certainly spot a top or bottom EARLY in its life cycle!

While we could not predict when a car is going to stop when the driver's foot is still on the accelerator, we could definitely tell when it has started to happen when the driver's foot leaves the accelerator and moves onto the brake pedal. While we could not predict when a rising ball would start falling, we could definitely tell when it has started to happen when the ball stops rising.

Yes, there are plenty of technical indications and techniques that you can use to identify when a move has started to happen and then take early action but you would definitely not be able to tell with any degree of reliability when it will happen BEFORE it happens. That is why professionals like myself trade NEAR tops and bottoms and not before them. While I would not be buying in at the absolute bottom or selling at the absolute top, the trades that I make have a far higher degree of success than those trying to PREDICT those tops and bottoms before it happens.

The Star Trading System that I invented is a system designed to trade high probability signals near those critical points. So, the next time anyone tells you that they have discovered a way of spotting tops and bottoms before it happens, please turn around and tell them that you have a better way to trade.

Jason Ng has sinced written about articles on various topics from Finances, Investments and Trading Strategy. Jason Ng is the Founder and Chief Option Strategist of Masters 'O' Equity Asset Management ( ) and author of. Jason Ng's top article generates over 301000 views. to your Favourites.
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