How to Start a Food Business/Plan Review Prep

By: David Arts

Starting a Food Business

This guide is for prospective operators of food enterprises (food establishments, retail food stores, food warehouses, and food processors) desiring to open a food business in either their local city, county or state jurisdiction. This is a general overview and may not be all inclusive of the codes and ordinances in your locality. It is good to note that though this document will more than likely cover most if not all requirements for starting a food business in your jurisdiction, it would be in your best interest to familiarize yourself with the codes and regulations of your local city, county and/or state.

Operating Permits - Food Enterprises

A Food Establishment application can be obtained at your local city or county health department. If you plan to manufacture foods and package for retail sale you may be required to obtain a food manufacturer’s license from your state regulatory agency. If you plan to distribute your product outside of your state lines a federal license may also have to be obtained. It is recommended that you submit a fully completed application and fees at least one month prior to your anticipated opening date. This gives the local authority the needed lead time to process it and schedule any needed pre-opening inspections. Again, make sure that you provide ALL information required on the application. Incomplete applications may delay your approval.

Food permits are generally in effect for one year from the date of issue and are renewable each year thereafter when the appropriate fee is paid and as long as the establishment remains in compliance with applicable Health codes and regulations.

Home preparation of food for public consumption is prohibited. All food that is to be consumed by the public, whether free or for purchase must be prepared at a permitted establishment that is inspected by a federal, state, or local Health Authority.

Food Establishment Fee: Food establishment fees are variable depending on jurisdiction. Contact your local health authority to inquire about permitting fees.

NOTE: Larger establishments that have multiple food service operations on site may need to obtain a health permit for each operation. A separate application and fees may need to be submitted for each operation.

Food Enterprise Pre-Opening Processes

When starting a Food Enterprise business you may be required to go through either or both A) a change of ownership inspection or B) a plan review process. Read through options A & B below to determine which best fits your situation. Contact your local health authority if you need help in making that determination.

A) Change of Ownership Inspection Process-

Before opening for business you may be required to go through a change of ownership inspection. This inspection verifies your establishment complies with current regulations and that clearance to occupy the site has been granted by your city or county. This inspection may incur a fee and the fee for this inspection will more than likely be required to be paid before the inspector conducts the inspection. If applicable, a request for a Change of Ownership application should be available at the offices of your local city or county health authority. Again, to expedite your request, a fully completed application must be submitted. After submitting the application; call to schedule the inspection with your inspector. If the establishment doesn’t comply with current regulations you will be required to bring it up to code before your operating permit is approved. Prospective business owners, if available, it would be in your best interest to request a change of ownership inspection before finalizing the sale. This gives the prospective business owner a heads up on any items that may be required for the establishment to be in compliance with local city or county codes. Under no circumstances may you begin operations without approval from the local city or county health authority. Legal charges may be filed against you if you do.

B) Food Establishment Plan Review Process¬

A plan review will more than likely be required for any newly built business or in the event of an extensive remodel of an existing business. NOTE: This will also more than likely require a completed application and fees be paid in order to initiate this process.

A Plan Review is required whenever a building is constructed or substantially remodeled to be a food enterprise, whenever a substantial change is made to an existing food facility or may be required if a plumbing permit, building permit, or other construction permit is required by the local city or county development offices.

The Plan Review Application, including proposed menu, Fees, and 1 or more sets of building plans all may be required to be submitted as a package. Review all forms thoroughly to ensure accuracy of information provided. Incomplete or inaccurate applications could delay your plan review. The Plan Review Application should be available at the offices of your local city or county Health Authority. Upon approval, the plans are stamped by the Health Authority and the person submitting the plans will be called to pick them up.

Submit building plans after the type of food operation and menu has been determined and after receiving Building approval from your local city or county development offices. The building plans should be drawn to scale with most plans drawn in a scale of ¼” = 1Ft. and detail the layout of the kitchen, dining area, restrooms, storage areas, break room, wait stations and bar. The plans are to include a materials list of specifications for all floors, walls, and ceilings.

Certificate of Occupancy

All Food Enterprises will more than likely be required to have a Certificate of Occupancy (CO). A CO is issued after the Building and Health Officials inspect the building and find no violations of the Building or Health Codes during new construction and/or a remodel. The CO will also state the use for which the building will be used. The CO Inspection is usually required prior to getting final health approval but in some cases not only may a preliminary CO inspection be required prior to receiving your final health approval but a secondary (final) CO inspection may be required by your building inspector before your Operating Permit is approved. Inquire with your local health authority and building inspectors to see what process is required. NOTE: Contact the building inspectors at least 7 days prior to the time you are ready to schedule your inspection. This should insure that you get a timely response.

Permit Approval

Once you have completed the pre-opening processes and your Building and Health Inspectors have approved your operating permit, you may open for business. Under no circumstances may you begin operations without approval from both the Building and Health Inspectors. Legal charges may be filed against you if you do.

Other Approvals

Building Permits: Plans may need to be submitted for a Commercial Plan Review. If required, contact your local Building or Development Services Office to schedule this review and to obtain a building permit.

Industrial Waste: If you are taking over a previous business and changing the type of operation, ensure the grease trap meets the requirements for your new operation. For example, when a “sandwich shop” becomes a “fried chicken” location, the existing grease trap may need to be modified. Contact your local industrial waste inspector to ascertain if any changes need to be made to the existing system or to evaluate your engineered designs if your plans require the installation of an on-site septic system.

Fire Inspections: Building Inspectors are concerned with grease-laden vapors and proper hood protection in food facilities. All cooking equipment must be installed under an approved hood system. In addition, establishments in excess of 5,000 sq. ft. are required to provide a sprinkler system. Establishments with an occupancy load in excess of 50 people are required to provide fire alarms. Call your local building inspector, fire inspector or fire marshal to evaluate plans or to schedule a site inspection.

What to put in a plan Review

Include and Identify the following on your Building Plans

● Major pieces of equipment

Refrigerator/freezer units

Vent-hood

Ice machines/bins/dispensers

Steamers

Microwaves

Warming Drawers

Stoves

Prep tables

Ice Cream Dispenser

Ovens

Dish Machines

Beverage Station/dispenser

Grills

Mixers

Blender Station

Fryers

Food Processors Salad/Food Buffets

● Sinks

Hand sinks (food prep areas • ware-washing area • restrooms) Ware washing sinks Service Sink/Mop sink/curbed floor sink Food Prep Sink

● Dumpster

● Grease Barrel

● Chemical Storage areas

● Mop drying area

● Employee area for belongings

● Dry food storage area

● Doors

● Mechanical ventilation in restrooms

● Outdoor food prep areas (bars/wait station/BBQ)

● Grease trap size and location

● Water Wells

● Underground and overhead sewer and waste lines

● On Site Sewage Facility

Health Code Plan Notes

1) Refrigeration All refrigerated units are to hold foods at or below 41°F.

2) Restrooms (two are normally required). If the establishment has only carry-out or seating for less than 20 people, and less than 10 employees, then only one employee restroom may be allowed. Two restrooms may be required if alcohol is served on the premises or more than 20 seats are provided. Each restroom must have a hand sink with hot (at least 100°F) and cold water, mechanical air ventilation to the outside, and a solid, self-closing door. Restrooms may not open directly into a kitchen. The total number of restrooms for a Childcare facility is dependent on the “minimum standards” of the Texas. Dept. of Family and Protective Services (834-3195) as it relates to Childcare.

3) Sinks

A. Service Sink/Mop Sink/Curbed Floor sink: At least one of these must be available for mop washing and disposal of mop water in an approved waste water disposal system. A drying rack is required for mops to air dry. This sink must be provided with a backflow preventer on any threaded hose bib to protect the water supply. Note: the mop sink may be located in a different area of the building than the kitchen.

B. Hand washing sinks: Shall be located to allow convenient use by employees in food preparation, food dispensing, ware wash areas, and any wait station where ice is dispensed, bar area or in a walk-in where meat is cut or trimmed. At least one hand sink will be required; additional, separate hand sinks may also be required. Small kitchens with food prep and ware washing in close proximity may be allowed to use one hand sink to serve both activities. Other hand sinks must be associated with restrooms. Provide at least 12” tall splashguards if a hand sink is located near food prep, open food, ice, or clean food contact surfaces. Otherwise, the hand sink must have at least 18” lateral separation from these. A sign or poster that notifies food employees to wash their hands shall be provided to all hand washing sinks and be clearly visible. A small, swinging door (as in a bar area) could separate a hand sink from a work area, otherwise no doors separating hand sink from work areas.

Each sink must be supplied with hot (100°F) and cold water, soap and disposable towels. Childcare facilities must have hot water in the diaper changing area and kitchen. If plans do not provide sufficient hand sinks to meet the requirements of the establishment you will be asked to provide a revised plan with additional hand sinks.

C. Ware Wash Area: A commercial dishwasher or 3 compartment sink is required in most cases. Dish machines must be able to effectively sanitize all equipment and utensils. They must dispense a chemical sanitizer or provide a final rinse of at least 180° F. (single, stationary rack machines are required to reach 165° in the sanitize cycle). Test strips are required. Above-the-counter dish machines are required to have Type II vent-hood.

Ware washing sinks shall be of sufficient size to immerse the largest piece of equipment. Cold and hot (100°F minimum) water under pressure delivered through a mixing valve shall be provided. Provide at least 2 integral drain boards or 1 integral drain board and a mobile dish cart. Drying racks or shelves will aid in adequately air drying all wares. Facilities with very limited ware washing and using disposable containers may request a variance to install a 2 compartment sink (example: convenience store). These sinks are required to have a drain board. The sinks must have an indirect connection to the sanitary sewer (at least a one inch air gap). This includes all food prep sinks and ware wash sinks.

4) Ceiling Construction: Ceilings over open food, ice, soda fountains, ware washing, restrooms and bars must meet construction criteria and be smooth, durable, nonabsorbent, and cleanable. Open rafters, trusses or grid work and exposed duct work, pipes or utility lines are usually prohibited with no open structure permitted. If drop down acoustic tiles are used, they must be properly constructed. These tiles are washable and have a smooth surface without pinholes. Painted dry wall or boards are generally acceptable.

5) Walls/Floors: Must be constructed of approved materials. Cleanable water-based enamel paint is usually acceptable for most wall surfaces. Areas that are subject to regular cleaning and splash may be covered with FRP, stainless, or galvanized metal. Floor/wall junctures shall provide no greater than 1/32” gap. Baseboards are required. Caulk wall/floor junctures to prevent the collection of food particles and water. Masonry (brick/concrete) wall/floor junctures DO NOT require baseboards since a masonry juncture provides no gap. Raw brick and concrete in the kitchen area requires sealing. The sand grout of all tiles needs to be sealed. Epoxy grout does not require sealing. VCT floor tiles require a coat of wax to seal out liquids.

6) Solid Waste: Dumpster and grease barrels shall rest on a machine laid asphalt or concrete pad. These containers must have tight fitting lids and drain plugs in place.

7) Outdoor Cooking facilities: Barbeque pits or smokers shall be enclosed, and if screened in, at least a 1/16” mesh screen is required. They shall rest on a concrete or asphalt pad. The meat may only be placed on the smoker; no food prep allowed in this enclosure. Any seasoning, cutting, etc. must take place inside the establishment. Outdoor bars and wait stations will be approved on a case by case basis by your local health authority.

Water and Sewage Systems: All private onsite sewage facilities and wells serving a new food enterprise, an extensively remodeled food enterprise, or a food enterprise coming under new ownership must meet current standards. These systems are required to be evaluated with respect to whether the system (a) meets current standards and (b) is adequate for the proposed use.

NOTE: A food service facility or Childcare facility using a well may be considered public water supply and subject to specific restrictions and regulations. Consult your local health authority to inquire about any questions regarding the use of a private well.

9) Protecting the Water Supply: Threaded hose bibs are required to have a backflow prevention device attached. Spray hoses and fill hoses shall hang at least 1 inch above the maximum flood rim of a basin or the hoses shall be provided with an atmospheric vacuum breaker or backflow prevention device.

10) Indirect Connections: Jockey boxes, ice bins, ice machines and sinks (as identified above in # 3) must be provided with indirect connections to the sewer. Floor sinks are required on new construction.

11) Lighting: Adequate amount of light shall be provided to all areas. At least 20 foot candles is required where food is provided for customer self-service such as buffet and salad bars or where fresh produce or packaged foods are sold. At least 50 food candles is required at surfaces where employees are working with food using utensils or knives, slicers, grinders, saws, or where employee safety is a factor.

12) Outer Openings: All windows, vents and exterior doors shall be tight fitting. If needed, use weather stripping to provide a tight fit. All exterior doors shall have a self-closure. Screens on windows and doors shall be at least 1/16” mesh. Roll up doors to be screened or the proposed food service area provided with physical doors to create a separate walled room. Exhaust fans must be screened, or if they are louvered, must automatically close when the fan is disengaged.

13) Food Contact Surfaces: Stainless steel, Formica, polished marble, Corian, machined stone, approved ceramics or plastics may be used for food contact surfaces.

14) Counters: All raw wood must be painted in areas that come in contact with food, liquid or food containers of any kind. Included is the underside of the bar above the ware wash and/or hand sink (and the splash area).

15) Toxic Materials: Specify an area where chemicals are to be stored. A well-labeled, separate shelf or cabinet is best.

Food Manager Certification: The health codes of your State, County or City may require that one or more food managers of a permitted Food Enterprise to obtain a Food Manager Certificate. A Food Manager Certificate is recognition that a person has received training in food sanitation. Inquire with your local health authority to see if food manager certification is required and the necessary steps required to obtain proper certification.

Further information on our website at www foodcertified com in the blog section.

Article Source:
http://www.articlecity.com/articles/business_and_finance/article_11059.shtml

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Debt Collection Australia - Changes With Global Impacts

By: Neil Wood

The industry of Debt Collection industry in Australia ratified the formation of a new and very pro active industry association to be called Australian Collection & Debt Buyers Association (ACDBA) during the annual conference of the Institute of Mercantile Agents, held in Melbourne May 14 - 16.

This has enabled the industry to bring together the large national companies as well as the SME members of the industry in a positive way, and overcoming the lack of liaison prevalent in previous years.

The significance of the industry coming together could not be overstated with proposed legislation from the new Rudd Labour Federal Government (National Consumer Protection Bill 2009) about to be introduced, bringing further regulatory legislation competing with existing State and Federal law and causing higher costs to the industry as a whole just to remain compliant.

In addition to the compliancy costs, the act will also lead to increasing controls on how collection agencies may act, and whilst it is said this is aimed at providing protection to consumers from those companies who adopt overbearing and harassing tactics, its flow on effect is likely to lead to responsible and ethical collection agencies being impacted to the point they will reduce staff due to the increasing compliancy costs.

The ACDBA has sent a detailed professional submission May 22, 2009, to Geoff Miller, General Manager, Corporations and Financial Services Division, Department of the Treasury, pointing out the proposed legislation was prepared targeting finance brokers, finance companies and credit providers, and has the flow on effect of including the collection industry.

The move by the Rudd Government reflects a growing and justifiable concern by the Australian collection industry as to why the proposed legislation is necessary, when the industry has been working with state and (other) Federal Governments for more than two years to ensure the industry remains compliant with ethical, legal and community expectations, and begs the question ” What’s in it for politicians”.

The collection industry can be, and has been for many years a whipping post for media and politicians who know full well the industry will never be popular with the community at large, and will use one off incidents of rogue actions by collectors (whether by finance company, banks staff and not collection agencies) to create sensational headlines, and not take into consideration the millions of contacts made by the industry on an annual basis.

There is growing concern amongst the global collection industry that legislation like above, will be adopted by other Governments around the world unless the collection industry associations remain active and vigilant in lobbying against legislation that is based on political or media driven, and often ill informed, small groups of lobbyists driving a hidden agenda.

Research over the past year has confirmed that in Australian alone over twenty (20) million calls alone were made to debtors during 2008, in a population of twenty two (22)million, with less than fifteen hundred complaints made to regulatory authorities, whilst the industry was responsible for returning over $60 billion to the Australian community.

Article Source:
http://www.articlecity.com/articles/business_and_finance/article_11000.shtml

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Can a Home Based Occupation Really Save a Life?

By: Brandon Porter

A common question: “What is a Home Based occupation?” It helped me break out of my financial funk. I can now say that work is actually fun! Let me enlighten you on the idea of the home based job.

Dealing with a home based occupation can actually help out your life greatly if you can understand how to use it properly. It brings forth opportunities for the manager of the home based job to perfect his or her day so they can experience a flawless agenda. It may not be apparent to some, but the home based business leaves a sense of freedom different from those unoriginal nine to five jobs.

Home based businesses can offer an individual some sense of a stress liberated lifestyle because of the characteristics that it holds. For instance, one can do all the work he or she would like to do without a grouchy boss stating what should be done. You are the boss of all that happens for your business and will never have to consider unwise ideologies of upper management. The home based occupation allows you to generate executive decisions without the approval of some other, different to what can come about with corporate power structures–you have to ask if what you are doing is okay with your superior. You are the superior of whether the organization will build into something that is marvelous or stall for the following grand chance to shine; no board of choice makers will be capable to interfere with their views ever again!

When putting together an occupation, it would be cost effective to form a home based occupation due to the lack of expenditures. This differs from you average business where you have to think of mandatory budget blowing facets. Because home based jobs have very little expenditures affiliated with its performance, you will see way more disposable income in your pocket. Because home based businesses usually have different methods of operating, you will see how fast and effortless it is to get your introductory gains.

A affair to note is that with home based businesses you won’t have to handle what other jobs consider: Property Prices. This will now be an expense that is not mandatory with your business and its function.

Home based businesses rid you of dropping your money on clothing for the workplace and meals you require to help sustain your functioning during the day. You can now use that cash to expand your job. Since you have been saving so much money with your home based job, you can use it to build a more superabundant future for yourself.

If you establish your home based occupation, you will finally get all that time you need to spend with your family and friends. You will be prepared to test new approaches to tackle job obstacles because of the “liberated” feeling that comes with a home based business. This mental attitude will do wonders for your productivity and will potentially propel your job into marvelous circumstances.

Acknowledging that any individual should have another manner of attaining money exists due to the insecurity that come from average jobs–you can lose your job without notice and that can leave you in a damaging place. because of the many streams of income you can earn with home base occupations, you will enable yourself immeasurable protection within the area of work. If you have a “never-fail” way of acomplishing tasks and a firm occupation plan, you will definitely appear on top inside the universe of home based lines of work.

Article Source:
http://www.articlecity.com/articles/business_and_finance/article_10986.shtml

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IT Staffing Agencies Need General Liability Insurance

By: James Cochran

IT staffing agencies are familiar with their clients’ requirements for insurance coverage, and know that they have to have the insurance to get the business. But you may wonder if all that coverage is really necessary. The good news is that in almost all cases, the insurance coverage your client requires can be both affordable and beneficial to your business.

Beyond finding a reputable insurance agency, staffing firms need to do their homework to reduce their liability in client dealings. Typically, clients want their IT recruitment agencies – as well as the information technology subcontractors those companies hire on their behalf – to carry some or all of the following four types of coverage:

General liability insurance

General liability insurance for IT staffing agencies covers damage to property or injury to people. Client companies often require all of their vendors – from plumbers to IT staffing firms – to show proof of general liability insurance. In some cases, the mandate is driven by the client’s risk managers, who seek to reduce the company’s risk of financial loss due to lawsuits.

Any systems integrator you place on a job could accidentally damage hardware, cause a short or put a foot through a drop ceiling while pulling cable. Even a software developer, software engineer or programmer working at home could accidentally spill a drink on a laptop or drop a server in his or her possession.

When a client goes after one of your information technology subcontractors for compensation, you’re likely to be held responsible as well. IT staffing firms with liability insurance from a quality insurance agency are protected from the financial fallout that could result.

Professional liability insurance

Professional liability insurance for IT recruitment agencies is like malpractice insurance for these firms and the information technology service providers they place. Also known as E&O insurance, it protects your IT recruiting agency from liability arising from errors and omissions that you or your information technology subcontractors may make on the job. Clients require it because they know that people make mistakes.

Your client’s greatest risk in hiring you is that your mistakes could spawn a lawsuit or financial loss. For example, if your staffing firm places an information technology subcontractor on a job, and that individual makes a mistake that wipes out hundreds of thousands of dollars worth of client data, your client can claim the error was your fault and expect you to compensate the company. Without liability insurance, IT staffing agencies can expect costs to mount quickly.

Having professional liability insurance for IT staffing agencies just makes sense. Without it, IT staffing firms are liable for legal defense costs if their clients make claims against them and for settlement costs if a court finds them at fault. A misunderstanding may be all it takes to get sued. Once a client alleges negligence and communications break down, your legal expenses begin to grow.

Workers’ compensation insurance

Some states require companies to carry workers’ compensation insurance, while others don’t. If your client’s company is based in a state that requires it, your IT recruiting firm will probably be asked to carry it, even if your own home state does not mandate it.

Why? In some states, your client will be forced to cover you with its own workers’ compensation policy if you or your employees get injured on the job. Also, in some states, your client’s insurance carrier can bill your client for coverage for all subcontractors who don’t provide their own certificate of coverage. Both result in higher premiums for your client.

Workers’ compensation insurance covers medical costs as well as disability and compensation, should you or one of your employees get hurt on the job. If you’re a solo IT professional with your own health staffing insurance, workers’ compensation insurance may be redundant – but you may still need it to get the work.

If your IT recruitment agency does have employees, protecting them with workers’ compensation insurance is a smart thing to do. From carpal tunnel syndrome to a slick break room floor, any number of on-the-job hazards could jeopardize your employees’ health or take them away from their jobs. Workers’ compensation coverage ensures that your employees are taken care of and saves your company any expenses arising from their ongoing care.

Working with a reputable insurance agency, IT staffing firms can secure the right coverage to meet client and state requirements.

Fidelity bond coverage

Often described as employee dishonesty coverage, this type of insurance compensates your client if you or your IT staffing firm’s employees steal money or property on the job. If your IT staffing firm places an information technology service provider who turns out to be less than honest, you’re just as likely to be held accountable as the person who does the deed.

Clients in the banking and financial services industries typically want programmers, software engineers, software developers and system integrators to carry fidelity bond insurance from a reputable insurance agency because they’re entrusting them with sensitive information, such as customer account numbers, and personal information, such as Social Security numbers.

If your staffing firm has information technology subcontractors handling valuable property or customer information – even though you trust them – keep in mind that anything could happen. Computer equipment could disappear, or a programmer could obtain banking customers’ account numbers and passwords to steal from their accounts. If that happens, fidelity bond insurance for IT staffing firms compensates your client for the missing money or property.

By contacting a quality insurance agency, IT recruitment agencies can learn more about fidelity bond insurance and how much coverage is best.

Article Source:
http://www.articlecity.com/articles/business_and_finance/article_11044.shtml

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What is a Trading Edge and How to Get One

By: Chris Strudwick

One of things that comes with experience is a trading edge. If you are unable to develop a good trading edge over the other traders, you could end up losing all of your capital, even if you are very disciplined and organised.

In this article I will cover some pertinent factors that I quite often use in achieving my own personal trading edge.

Fundamental Analysis.

Fundamental analysis as we all know by now, is the best method of checking out the financial condition of a company. This is easily accomplished by using financial reports, price/earning ratios, incomes, market share, sales and growth, etc.that are available This type of analysis can be very time consuming but I find it well worthwhile the effort that I put into it.

Here are a few factors that I take into consideration when researching a potential stock.

1. Earnings Per Share (EPS) .This shows me the stock’s average short term (recent quarters) and long term (last three years) earnings growth rate actually is.

2. Relative Price Strength (RPS) This measures a stock’s relative price change in the last 12 months in comparison to other equities Iin the Stock market.

3. Sales + Profit Margins + ROE (Return on Equity). This shows you a company’s sales growth rate during the last 3 quarters, before and after profit margins and the return on equity.

If you like the idea of including fundamental analysis into your own trading plan, I would consider trading only stocks that meet some of the basic minimum requirements.

I personally like to use fundamental ratings for longer term trades such as the ones I plan on weekly charts. This won’t be of much help to you if you happen to trade intraday.

Fundamental analysis can be a phenomenal way to build up a list of good solid potential profitable stocks, or as an alternative you can utilise it as a way to filter out the weaker stocks, but that’s about its boundaries. It will not provide you with an objective method to either enter or exit your trades. All of my trading decisions (entry, exit, and stops) are all based on technical analysis. Which we will now take a closer look at below.

Technical Analysis.

Technical analysis is basically all about the analysis of prices and their behaviour. These price actions depict patterns on charts and because human behavior is notoriously repetitive in nature, these price patterns can also be seen as very repetitive as well. By being aware of this important element definitely puts the odds in our favour right from the start.

You can choose from a variety of chart types that are readily available. The Japanese candlestick charts I have found by far are the easiest to utilise and could quite possibly be the one chart that you will use the most.

There are entire books devoted to the study of these candlestick patterns - if you are really serious about studying candlestick charts, Just take a look at the free books available on www asxnewbie.com.

Support and Resistance:

This is one of the most important concepts in technical analysis. Support and Resistance forms the very basic foundation for nearly every trading decision you will make. To give it full coverage would require many pages but I will limit myself to some very basic definitions and just a couple examples:

Support level:

This is a price level that a declining market or stock has failed to penetrate and has rebounded off at this level.

Example: the low of the previous day forms an line of support and this price level is often frequently used as a stop loss.

Resistance level:

This is a price level that a rising market or stock has failed to break through and has rebounded off it and headed back downwards.

Example: a previous high in an uptrend forms an area of resistance and this can be used as a minimum future objective to take some profits once that level is eventually reached.

Oscillators:

An oscillator is a technical indicator that will tell you at a quick glance whether a market or a stock that is currently being traded has been either “overbought” or “oversold.” A few traders often use these oscillators to forecast a future change in direction. Some of these examples include the RSI, Stochastic Oscillator, and MACD just to name a few.

There are many numerous oscillators and technical indicators that traders employ, but I personally like to utilise them to weed out the weaker stocks. Particularly if I am lucky enough to have accumulated a list of too many good stocks to choose from. A very nice position to be in.

There are other indicators that I also use from time to time.

I look for support and resistance on the VIX (Volatility Index) daily chart to assist me to foresee reversals.

I look at the Put/Call Ratio (5 MA and 10 MA) on the daily chart to see if traders are too bearish (MAs > 0.8) or too bullish (MAs 1.2).

I also look at the McClellan Oscillator – the market is overbought if it rises above +70 and oversold if drops below -70. A buy signal is generated if it falls into the oversold area (-70 to -100) and then turns up - a sell signal is generated if it rises into the overbought area (+70 to +100) and then turns down. If it goes beyond the -100/+100 levels then it may be a sign of continuation of the current trend.

This article has not really been about about teaching you how to develop that trading edge. The idea that I had in mind was that it has hopefully shown you that there are many various and excellent tools available that can be used to improve your trading odds and increase your profitability.

It will take time and effort to find the right combination that will fit your trading personality and your own trading techniques. With persistence you can hone your trading skills to a level that gives you that vital edge over the average trader. If by chance that happens then my goal has been achieved.

I wish you profitable trading.

Article Source:
http://www.articlecity.com/articles/business_and_finance/article_11007.shtml

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