WorldWideMarkets Community

Forex Trading, Market News & Technical Analysis

CFD: Ideas You Can Trade - USTech100 Inches Above Resistance

Posted by Steven Hatzakis on Jun 4, 2014 12:14:00 PM

USTech100: Ceiling near 3740 Re-tested as Prices Move slightly Higher to 3743

The short term daily candle chart below shows the price history of the USTech100 contract for difference (CFD) trading near 3746 (around time of publication) as the underlying index (NASDAQ) this CFD aims to track inched higher in today's trading session.

Last time this CFD was covered in the Ideas You Can Trade series, resistance was encountered near 3740, which provided a reversal of the upward momentum, causing the index to return to 3420 before rebounding to current levels.

Over the last week, resistance has been encountered in three of the last five trading sessions, with a higher-high reached today. If this resistance line fails to reverse the uptrend, a sharp reversal would follow and cause UStech100 to trade lower. However, if this ceiling that has been building near 3742 can be overcome a continuation of the uptrend should cause this CFD to make a new fresh multi-year high.

Below are examples of how to trade a bullish continuation or a bearish reversal:

1.  BULLISH BUY ENTRY ORDER: Create a “Buy Entry Stop” @ 3,747 with a Limit to take profit @ 3,789 and a stop-loss @ 3,703 Risk/Reward Summary: Limit risk = +44 points profit / (-42) Stop-loss risk = Gain to Loss ratio = 1.04

2.  BEARISH SELL ENTRY ORDER: Create a “Sell Entry Stop” @ 3,568 with a Limit to take profit @ 3,517 and a stop-loss @ 3,611 Risk/Reward Summary: Limit risk = +51 points profit / (-43) Stop-loss risk = Gain to Loss Ratio = 1.18

Short term chart (daily candles) using prior trend lines and new lines:

ustech100daily june 4 2014 note

A note on CFD’s: A Contract for Difference, or CFD,is a financial contract allowing traders to potentially profit whether markets move up or down and include risk of loss. CFDs are cash-settled based on the difference in the value of an underlying asset from the time a trade is opened to the time the position is closed. A list of available CFDs that can be traded with (WWM) can be found on the WWM website.

In addition to CFDs, WWM - through a third-party - offers direct access to non-US residents to trade exchange trade equities on the US Stock Markets, with more information also available via the WWM homepage.


Tools & Educational Resources

Forex 101LEARN MORE >>
Learn the basics of Forex and how to practice trading the markets.

GlossaryLEARN MORE >>
Confused by the language? Click here and search for key trading terms.

Browse our frequently asked questions and find your answers right away.

Access to the educational lessons, webinars and platform walkthroughs.


Get started with a FREE $10,000 Demo Account and experience the Forex Market RISK FREE!