New Techniques  |  APR 2000

Ram Trading by Lorne W. Rae

Ram Trading by Lorne W. Rae With this simple daytrading method using candlestick formations and the opening action, this author demonstrates a high-probability, low-risk trading strategy that gets you in and out in a single day. Just as the battering ram had a single purpose in the earliest wars — namely, punching a hole in a barred city gate — what I refer to as the Ram trading method is focused on a singular goal: to identify and implement low-risk trades that make money. To a trader, time is all-important. For stock traders, the shorter the time interval between buys and sells, the less likely it is that something will go wrong. Ram trading minimizes this risk by concentrating on the shortest of trading time units — a fraction of a trading day. For consistency’s sake, the terminology in this analysis assumes that ""right now"" is just prior to today’s opening of trade. STOCKPICKING Candlestick analysis is one technique that concentrates on short-term price movement. It is an excellent method for determining today’s likely price trend. There is extensive literature about candlesticks, and there are software packages to do the charting. Candlesticks are simple to use, and all a trader needs are three or so days of prior price action to produce proper results.

by Lorne W. Rae