What is US500 Trading Strategy? - Learn US500 Index
US500 Stock Indices Trade Chart
US500 Stock Indices trade chart is shown and illustrated above. On the above example this instrument is named US 500CASH. As a trader you want to find a broker that provides US500 Stock Indices trade chart so that you can begin to trade it. The example That is shown above is that of US500 Indices on MetaTrader 4 Forex Software.
Indices Trade Strategy for Trading US500 Stock Indices
US500 Stock Indices method of calculating makes it more volatile & hence there are more wide swings in the price movement of this Stock Index. Although this index in general moves upwards over long-term because American economy also shows strong growth & is also the biggest economy in the world.
As a trader wanting to trade this index, be prepared for wider price swing & a little more volatility.
As a trader you want to be biased and keep buying as the stock index moves upward. When America economy is doing well (most times it is doing well) this upwards trend is more than likely to be ruling. A good index trade strategy would be to keep buying the dips.
During Economic Slow-Down & Recession
During economic slow-down and recession times, firms begin to report lower profits and lower growth prospect. It is because of this reason that investors begin to sell stocks of companies that are reporting lower profits and hence Stock Indices tracking these specified stocks also will begin to move downward.
Therefore, during these times, trends are likely to be moving downwards and you as a trader should also adjust your trading strategy accordingly to suit the prevailing downward trends of the stock index that you are trading.
Contract Specifications
Margin Requirement Per Lot - $ 12
Value per Pips - $ 0.1
Note: Even though general trend is generally move upwards, as a trader you have to consider & factor in daily market volatility, on some of the days the Indices might move in a range or even retrace & pull-back, the market retracement move might also be a substantial one at times and hence as a trader you need to mark-time your trade entry precisely using this trade strategy: Stock strategy and at same the time use proper equity management principles just in case there is more unexpected volatility in the market. About equity management methods in indices lessons: What's indices equity management & indices equity management strategies.
