By Zak Mir of Zaks-TA.com*
Posted: Jun 12, 2009

One of the phenomena that many traders and investors try to avoid, and with good reason, is bear and bull traps. These can best be defined as brief breaks of support / resistance before the market returns to its existing range. The idea here is to actually take advantage of bull and bear traps after they have been identified so as to be one of the few who actually benefits from what can be powerful buy and sell signals.

The reason that this is the case is because the temporary breaks that traps represent are usually the result of stop losses being hit, thus causing an overshoot. The effect of this is to remove those from their positions who were actually correct in their view of where a stock or market was going.

By Guy Bower of www.guybower.com*

In the first article of this four-part series, we had a quick look at the concept of the delta. You will recall that the delta is a measure of how an option will move, given a change in the underlying. We all know the term is thrown around quite a bit by some options advisors and most warrant issuers. But, there is a lot more to it than the simple definition might indicate.