Igor

The problem with moving averages generally is that they are lagging indicators; they only produce clear signals when the market is already on its way. By calculating the moving average of the moving average, the lag is reduced and traders can use the DEMA to catch signals earlier.

The double bottom price area represents a support level at which a stock’s price cannot go below. The buying point of the asset is when the price action on its way up from the second bottom breaks above the neckline.

It is a boundary around a market price of interest, where the top of the channel is the highest high over a given period and the bottom of the channel is the lowest low over the same period. There is a similarity between Donchian channels and Bollinger bands in appearance.

A doji signifies that there is some indecision of investors with regards to buying and selling of the currency pair. If followed by a candlestick that is opposite the preceding candlestick, it is a sign of impending reversal.

The essence of "displacing" a moving average is to make it fit better with price movements in order to counter the lagging nature of the indicator.

Contrarian traders use the disparity index to tell when an asset's trend is nearing exhaustion. A cross above the zero line is an indication that the momentum of the new trend is building.

DMI runs on a scale from 0 to 100, with values closer to 0 signifying a non-trending asset while figures closer to 100 show that the asset is trending.

At the areas where the price shows a peak, the lows of the candle show lower lows, while the candles show higher lows when the price start to decline. The trend lines drawn across the higher high-lower low and lower high-higher low parts of the pattern give the pattern a characteristic shape.

It is a good indicator of a potential downside breakout for traders to prepare to take short positions. As prices move towards the point of convergence of both trend lines, the asset is more likely to break out of the lower trend line. Traders can then trade this downside break using pending sell orders.

The peaks which gradually get lower is an indication of the negative sentiment that market players have on a security or asset, showing that traders are more willing to sell at progressively lower prices as time moves on.

Traders can use the descending channel to range trade an asset in a bearish trend by selling on the upper trend line and buying on the lower trend line. However, it is much safer to trade with the trend by selling on the upper trend line of a descending channel.

The indicator operates like an oscillator to show market risk areas. Values above 60 are seen as areas of reduced risk while values below 40 are indicative of higher market risk.

The long term moving averages are regarded as having a lot of market importance and when it is crossed by the short term MA, it is akin to a break of support and thus a change in market sentiment to a bearish one.

This pattern works best when it is found at the top of an uptrend. The long white candle represents the previous bullish price action, but in the uptrend, sellers come in to force prices downwards, indicating a change in sentiment from bullish to bearish.

The best application of the cushion theory is seen when there are market fundamentals that point to a bullish move on a stock or underlying asset where there are more short positions than number of shares being traded. As the traders on short positions look for ways to cover the losses they could sustain for being short on the stock, there will be net purchases on the stock leading to a sharp increase in price. A trader on the sidelines can watch out for the cushion effect and use it to take a long position on the asset.

This is a rare chart pattern formation that is mostly seen on the daily charts. The cup is usually followed by an area where the price action forms a small retracement, and two trend lines can be drawn above and below the candles in this area to form the “handle”. The entry point should be at the break of the upper trend line in the area where the price action forms the handle.

Description: This indicator uses pivot channels to determine breakout levels.It uses resistance levels, open and close candles to determine position entry and exit. Installation Instructions: 1. Download the file 2. Unzip using ZIP or RAR 3. Copy the mq4 file in the experts/indicator sub folder of your Meta Trader 4 installation folder.

Money Management Indicators library for TradeStation. Includes Ave Trade, Equity Momentum, Percent Wins, Trade Dependency, and Win/Loss ratio indicators. MMINDICATORS.ELD

Traders can use the length of the shadow, the position of the shadow (upper or lower) and the presence or absence of a shadow to derive trading signals as this information has an impact on the future price behavior of an asset.

The implication of this formation is that the sellers who came into the market after the Day 1 candle could not force prices down appreciably after three trials (the bearish candlesticks), and they got exhausted and pulled out of the market, allowing buyers to come in and force prices even higher.

A higher RVI value is seen as a bullish momentum while lower values are seen to have bearish momentum.

Market-With-Protection Orders give traders protection against price slippage in volatile markets. In some cases (such as major economic releases) asset prices can gap and fill trade orders at unfavorable prices. Market-With-Protection Orders can help traders guard against potential losses in these situations.

Investors looking to capitalize on Long-Term Growth will typically implement "buy and hold" strategies, and this is very different from the typical activities of a Daytrader. Long-Term Growth investors use wider time horizons for their positions in order to protect against short term price fluctuations present in the market.

A doji is ordinarily a sign of market indecision, but when three Dojis appear, it not only signifies extreme hesitancy on the part of the market players pushing the previous trend, but also tells those who want to take contrary positions to the underlying trend that it may be time to take over the market since the traders pushing the trend have likely had their fill.

Usually a broken resistance becomes a support and a broken support acts as a resistance. In both instances, if the price of the asset attempts to go back to the previous broken key levels, the re-test will be resisted and the price will resume in the direction of the breakout. This serves as a good confirmation that the breakout was a genuine one and traders can buy at the resistance-turned-support or sell at the support-turned-resistance.