Trade Signal
Definition of 'Trade Signal'A sign, usually based on technical indicators, that it is a good time to buy or sell a particular security. Trade signals come in a variety of forms, including bull or bear pennants, rectangles, triangles and wedges, as well as head-and-shoulders chart patterns. Trade signals may also bring attention to abnormal volumes, options activity and short interest. |
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Investopedia explains 'Trade Signal'Trade signals can also be combined with fundamental analysis to give investors another weapon in their stock trading arsenal. In volatile markets and/or with high-beta stocks, using trade signals can be invaluable to investors - not only to point out promising opportunities as they appear, but also to signal when they may disappear. |
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