How to Analyze Market Trends and Merch + Tips

In the following report I will provide advice to an amateur merchanter looking to make money. I will show how to analyze market trends, how to flip and will give some tips.

Something you need to know:

Patience is a must, you're not going to make a mil in a day if you have 300k, it takes time to build up your money.

Money cannot be created from nowhere on the G.E, it is evened out by lost money potential and lost money. E.g. you make 300k on the G.E in one day, someone will lose 300k on the G.E that day (this is usually more than one person) and then there's the lost profit. This might be confusing but you will understand it later.

You will lose money occasionally, (failed merchs and flips) diversifying your portfolio will help reduce money but you will eventually lose money.

The more patient you are, the more money you will make.

Only put in enough money you can afford to lose.

The G.E has the potential to earn you more than your best money making skill, and used properly you won’t have to do money making activities and you can focus on power leveling.

The G.E updates randomly every time, I personally use this website http://www.geupdate.com/.


The first thing I will be covering is how to analyze a trend and basically predict a price rise and fall.

The method I use consists of identifying a month rise or month fall, I will basically stick clear of these items even if they are rising in the daily charts.

Dharok's Platelegs - 3 Month


Here I have highlighted the rises and falls within the 3 Month trend (blue line). As you can gather, I never even attempt to trade anything that's falling down within the month average. This is because of the instability of the item and I've been following this rule for a year. Meaning, I buy items that are in the green zone (monthly rise) so I have some security that the price won’t drop right down.

The reasoning behind this is that the monthly average shows an average market trend and what the price is more likely to do in the future. Whilst the day price is very unstable and erratic, harder to predict what will happen. This is represented in the graph.



In some ways it could be seen as the blue line is the line for long term investors and the daily line is the line for short term investors. But going on the prediction of one line is very stupid and wont get you very far.

To make things easier, I will call an item that is raising within a month average a high and an item falling in a month average a low. Or, monthly high, monthly low.

The next thing I will be discussing is daily falls and rises.

I will call daily rises highs and daily falls lows or daily high, daily low. With both lines together they will equal (monthly line),(daily line). So if the monthly line is rising and the daily line is falling it will be a high low (high,low).

In regards to the previous text, I look to buy at a high low and sell at a high high. You might want to buy at a low low and sell at a high high but this will take more time and I don't recommend it.

Looking at a graph in detail (the daily line will make sharp spikes and sharp drops). I've taken the previous graph and have highlighted the daily highs and lows.



So just to clear things up

Green Green = high high
Green Red = high low
Red Green = low high
Red Red = low low

Never trade with something starting in red (monthly fall), buy at green red and sell at green green.

You might be wondering what the lines between these falls and rises mean, well basically, these lines are either straight, rises or falls. The best item to merch is an item that has just his its Green red (high low) and is in the first update of it’s ascend. Grabbing onto this assures you of a rise for 3-5 days, you should then aim to sell just before Green, Green to prevent you being stuck with the item as it falls.

This is something I predicted yesterday.

Dharok's Platelegs yesterday, I took a picture of this and explained to my friend how to predict rises and falls, I then predicted it to rise 50-100k in one day considering how much these items are merched.



The day after this, the item rose 60k. If you hoped onto this and bought 10 you would've made a nice 600k, tomorrow possibly more. It just shows you how easy it is to make money on the G.E.

How to Flip

IMO, the safest way to make money of the G.E and done properly can be the best. It's basically buying an item than selling for more than you bought it for. Flips are usually done on 1-2 days. It your taking any longer than 2 days than you should either switch items or lower your goal profit. Don't be stupid, don't flip retarded items that you are stuck with after you buy them for lowest, don't buy junk (only flip useful things). And don't try and make a few k of a flip, it's just a waste of time.

Figuring out sell and buy price:
Buy one of your item for MAX. Look at the price it sells for, if it sells for max and no cash is given back then dont merch the item, if it doesnt sell at max then dont merch the item.
Get your sell price and remove 1-5%, (i personally do around 3.5%). To do this : sell price/1.02 (2%).

Things you need to remember:
You can't sell something on the G.E that you bought via trade or G.E until 4 hours.
There are certain trade limits on items, I can't list them off my head but it’s something like
10 Barrow Items
20k Raw Materials (skilling stuff)
2 Rare’s
100 Glories

I usually stay clear of the limits. Another tip, it doesn't hurt to look at an items G.E history before you buy so you know you're not buying a falling item that you won't be able to sell

Picture of my flips:



I'm happy to help anyone out with merching, just post a message.

 

thanks for the guide + few merching items

 

thanks i got enough money now to start merching + flipping so this guide helps me a lot

 

Try karils body if you have enough, it will most likely peak in 3 days and rose 125k in one update.

 

added a few more things to the thread