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Technical indicators - Aroon, ATR, CMO, ADX

AroonThis is a technical indicator developed 10 years ago and can be used to find out if a stock is trending and how strong the trend is. It has also been designed to show the beginning of a new trend. It consists of two lines, upper aroon and lower aroon. It uses mainly just one parameter – time periods. Upper Aroon line is the amount percentage of time between the start of a time period and the point at which the highest price during that period occured. If a stock make a new low of the give... Continue reading Comments (0) / Link to this topic - http://www.learning-to-invest.com/ Technical-indicators---Aroon-ATR-CMO-ADX--67.html
Elliot wave - guidelines for wave framework

Lets go on with Elliot wave theory and talk about the guidlines of the wave framework. Guidelines for the wave frameworkWhile there’s just 3 rules in the wave theory, there are a number of guidelines than in theory should make our lives a lot more easier, but in practice make it all more confusing. But in order to work with wave theory right, we also need to be aware of those. Relationships between waves that reflect the aspect of Fibonacci ratios are just tendencies, not permanent relationshi... Continue reading Comments (0) / Link to this topic - http://www.learning-to-invest.com/ Elliot-wave---guidelines-for-wave-framework--60.html
Introduction Elliot Wave Principle & Fibonacci ratios

Now it’s time to cover Elliot Wave principle basics. Firstly, if you make your trading decisions based on chart patterns then these decisions should be supported by some form of probability analysis – how potential such a move is and when is it likely to happen. Elliot Wave theory all by itself is unable to predict specific price movements but it does help us recognize the state of the market and probable price actions. By using Wave theory, it does help us find the most profitable wave format... Continue reading Comments (0) / Link to this topic - http://www.learning-to-invest.com/ Introduction-Elliot-Wave-Principle-Fibonacci-ratios--59.html
MACD histogram

Previously I have mentioned MACD indicator, now lets familiarize ourselves with MACD histogram. But before going there, remind yourself what MACD indicator was - „MACD is a variation of the price oscillator, it is calculated by taking the difference between two exponentially smoothed moving averages of 12 and 26 days. The MACD line is the differences between the two averages – longer one is subtracted from the shorter one. Then a moving average of 9 periods is calculated of this different... Continue reading Comments (0) / Link to this topic - http://www.learning-to-invest.com/ MACD-histogram--38.html
The Three Moving Average system

This system is mainly used to find markets which should be avoided when trading with technical indicators because they are often unprofitable. Three oving average system helps to find entry and exit points which could be profitable.This system consists of 3 moving averages with different time periods. The averages could be called as fast, middle and low. The length of the averages could be 5, 21 and 63 for example. Entry is signaled when he middle moving average crosses the long moving average... Continue reading Comments (0) / Link to this topic - http://www.learning-to-invest.com/ The-Three-Moving-Average-system--37.html
Technical indicators: Williams %R indicator

Previously I talked about Parabolic SAR indicator and that it can be used with Williams %R indicator. It is similar to Stochastic Oscillator with the difference that Williams %R has upside down scale while Stochastic Oscillator has internal smoothing.What is Williams %R indicator? Williams %R indicator was developed by Larry Williams and it is a momentum indicator. It is usually used to find overbought and oversold levels in non-trending markets. The value of William %R is static 0 to -100. Re... Continue reading Comments (0) / Link to this topic - http://www.learning-to-invest.com/ Technical-indicators-Williams-R-indicator--36.html
Technical indicators: Parabolic SAR (Stop & Reverse)

Parabolic SAR is a very useful technical indicator during trending periods. However, it shouldn’t be used if there is no trending period. Trend periods exist approximately 30% of the time.In trending markets it provides useful entry and exit points. The name parabolic comes from its shape which is like a parabola. SAR lets our investor follow the dots in an upward or downward trend until SAR is reached and then the trend reverses.SAR’s stop loss is calculated for each day via the previous days... Continue reading Comments (0) / Link to this topic - http://www.learning-to-invest.com/ Technical-indicators-Parabolic-SAR-Stop-Reverse--35.html
Bollinger bands

Bollinger bands are envelops that surround the price bars on a chart. Click here to see an example. Bollinger band consists of the middle band, upper band and lower band. Middle band is a simple moving average (N period), upper band is K times N period standard deviation above the middle average and lower band K times N period standard deviation below the middle average. For short term trading, the simple moving average is suggested to be 10-days simple moving average, 20 days for intermediate... Continue reading Comments (0) / Link to this topic - http://www.learning-to-invest.com/ Bollinger-bands--29.html
Relative strengh indicator - RSI

What is RSI? RSI is a momentum oscillator that compares stock’s or currencies magnitude of recent gains with magnitude of recent losses. It ranges between fixed values – 0 to 100 (where values usually move between 30 and 70). RSI is based on ratio of the average upward movements and average downward movements in a given period of time. Higher than 70 means usually overbought environment and below 30 oversold environment. How is RSI calculated exactly? We take some sort of period ( one of the m... Continue reading Comments (1) / Link to this topic - http://www.learning-to-invest.com/ Relative-strengh-indicator---RSI--28.html
Introduction to technical indicators II

In Introduction to technical indicators I we talked about moving averages, now lets go on with Oscillators. OscillatorsOscillator is an indicator that is generally said to swing forward and backward within a certain area (minimum and maximum). Often the minimum value is 0 and maximum value 100. What is Oscillator meant for? It measures market momentum or the rate of price change. It helps us search for strongest trends in their strongest momentum. Momentum oscillatorsMomentum oscillator calcul... Continue reading Comments (0) / Link to this topic - http://www.learning-to-invest.com/ Introduction-to-technical-indicators-II--23.html
Introduction to Technical indicators I

Technical indicators are basically mathematical formulas based on price activity. Technical indicators should be used together with chart patterns to get the best idea of what’s happening with a stock, currency or anything else and what sort of change could be expected. The primary input for technical indicators is close price, less often also open, low or high.Technical indicators can be mainly used to · Measure strength of a trend· Find support and resistance areas in trends·&... Continue reading Comments (0) / Link to this topic - http://www.learning-to-invest.com/ Introduction-to-Technical-indicators-I--22.html
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Learning to invest in financial markets is like learning how to play casino games. First, you have to start with the basics. You can’t expect to become a pro overnight. Second, you have to learn to lose sometimes. It happens to the best money managers and the best blackjack players.
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