What’s the Secret to Identifying the Greatest Aussie 200 CFD Index Trades

Many aspiring traders consider it high priority to nail a perfect trade on the Aussie 200 index. It’s not only that the rewards are great but if you picked the winning trade it will be a great boost to your confidence. Today we will delve into the top secret in trading the Aussie 200 index and to be always ahead of the game.

As the name says, the Aussie 200 index is a bench mark of the ASX or Australia Stock Exchange’s top 200 stocks. This can be calculated by means of market capitalization which signifies the size of a company relative to its contemporaries. By multiplying the total number of shares on issue by its current share price you will be able to derive the market cap for a stock or CFD. BHP possesses the largest market cap in Australia and it is followed closely by stocks like Telstra, Rio Tinto, National Australia bank and Commonwealth bank (CBA).

Now each stock can be weighted and that pertains to how largely it affects the Aussie 200 index. For instance the BHP contributes about 6-8% of the entire index each day, so if the BHP is having a bad day the index will surely suffer as well.
The stock weighted at 200 on the opposite side of the scale will be able to give the least percentage to the overall benchmark index. So you can assume fairly that the top 50 stocks will create the strongest impact to the index each and every day.

As an end result, the top secret in determining the best Aussie 200 CFD index trades is from a total analysis of the top 50 stocks every passing day. Now of there is time it’s smart to scan the top 200 stocks but since what we are aiming for is the largest value for our money so the top 50 stocks will fit that criterion well.

What you must do at first is to be comfortable with the time frame in which you are trading and to use the indicators that give reliable insights for short or longer time frames. You will most likely use short term oscillators like the stochastics or Williams %R, as well as short term candlestick patterns. This gives a great bench mark about what would most likely be the range for the given day.

Furthermore, make sure to find important support and resistance levels and use that as guide in your trades. If you are really confident about your levels then you can look to buying weakness and selling support in timed stop loss points.

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