Igor

The Fibonacci extension tool is used to predict the highest or lowest point the market will get to after resuming the previous trend from a retracement level.

The gap occurs at the end of a long trend, indicating that the momentum will soon taper off as traders offload positions. This causes reversal in prices that eventually fill the gap.

The exponential moving average are components of indicators such as the MACD. They are better than simple moving averages because they react quicker to trend changes on the chart.

The fade is popularly used by contrarian traders using the principle of retracement in a trend to try to pick profits from such periods.

A failed break is seen when a candle appears to have broken a key level of support/resistance, only for it to retreat and close above the support/below the resistance. If a trader opens a position prematurely without waiting for the candle to close, it will lead to a loss on the trade.

On the charts, a fakeout is recognized in several ways. Usually, it is seen when the price action appears to have moved in the direction of a signal, only for it to reverse after a short movement.

The long black candlestick that ends the pattern with a new low suggest that the downward pressure on the asset which is typified by the Day 1 bearish candlestick, is still at work.

False signals usually occur when analysis is made with lagging indicators without confirmation. Combining indicators (leading and lagging) with other methods of analysis helps eliminate false signals.

Fibonacci arcs are used in price retracement chart studies in technical analysis.

Fibonacci channels are used to identify points of support and resistance in a trending market.

The rate of change is depicted by the Greek alphabet Delta and is used very commonly in the options Fibonacci clusters are tools that are used by traders to quickly estimate the relative strengths of different support or resistance price levels.market.

It is a highly reliable candlestick pattern that shows that a peak has been seen, and is used by traders as a signal to open a short position.

Volume and price are plotted into single bars. Heavier volume is represented by thicker bars and thinner volume by thinner bars. Sharp price changes are usually preceded by heavier volume, so appearance of a thicker bar tells the trader that a significant change in price is coming.

It helps traders to either avoid the effects of sharp price movements or dampen their effects. Envelopes specify entry and exit points for trades.

It can be used to detect peaks and dips in prices and extremes in investor psychology.

The index’s component indicators; the bull power and the bear power, are obtained by using these respective formulas: For Bull Power: Bull Power = Daily High – n-period EMA (EMA – Exponential Moving Average). For Bear Power: Bear Power = Daily Low – n-period EMA.

Here, a positive number indicates an upward movement in price, while a negative number indicates a downward movement in price. The data on the ease of movement will guide a trader on when an asset will make a bullish run and when it will make a bearish run.

Values below 30 are regarded as oversold while values above 70 are regarded as overbought. The number of time periods of the DMI is inversely related to the volatility of the asset, making this indicator more sensitive to price changes.

The Dragonfly Doji signals market indecision on the part of buyers and sellers, and the direction of the next candle usually determines the direction the asset will assume. If the dragonfly doji appears at the top of a trend followed by a bearish candle, then the asset will undergo a bearish reversal. The reverse is also the case if it appears at the bottom of a trend.

Traders are usually advised to follow the trend, so when an asset is in a downtrend, it provides the signal for a trader to take up a short position.

The downtick volume is one of the indices used to calculate an asset's net volume, which could provide information for a buy or sell trade.

This is a bearish continuation pattern that shows that the pre-exiting downward trend is set to continue. The pattern also provides useful signals of upcoming price movements.

Down volumes are usually an indication of declining interest in an asset, which the trader can use to setup short positions.

In practice, OBV is a technical indicator which measures positive and negative flow of volume in an asset, with positive volume occurring when the asset’s present day close is higher than the previous day’s close, and negative volume occurring when present day’s close is lower than the previous day’s close. OBV was developed by Joe Granville in 1963.

The double top price area represents a resistance level at which a stock’s price cannot go above. The selling point of the asset is when the price action on its way down from the second top breaks below the neckline.