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SML - Stock Market Directory

NASDAQ Trading

By: MarketVolume.com Team

Article Category: SML Index Trading

NASDAQ Exchange is the world's largest electronic stock market. NASDAQ trading is executed through NASDAQ's sophisticated computer and telecommunications network. Without size limitations or geographical boundaries, NASDAQ's "open architecture" market structure allows a virtually unlimited number of participants to trade in a company's stock.

When interpreting the chart above, you need to remember that the most important factor is the relationship between Index Price and the Volume Moving Average (VMA). This charts is an excellent example of a signal that confirms the bottom in the index. As the index was trending down from 13:30, we see a very large increase in the VMA; this is a signal that the index should change direction after the peak and begin to go up. In this case, after the peak the index did not go up, but it continued to go down. This new downward trend is still accompanied with an elevated VMA (as the VMA never returned to normal levels), and that signals that this market bottom is going to be a long-term resistance level and that it is safe to play up.

Below is an example of how one of our exclusive institutional investors used this signal for the index to maximize profits by trading some of the derivatives of the NASDAQ Composite index:

Details of the above trades, and the derivatives used for this index, can be found in the detailed overview and in the member's section of our site.

By trading index securities using our volume indicators instead of stocks, you gain stability and predictability that stocks do not have. An index is a far more logical in it's actions than the individual stocks it's based upon.