Tuesday, October 02, 2018
INDICATORS FOR TRADING
The most useful information from indicators is here. Traders use it for assessment of the market scenario before trading.
- Direction of the current market trend
- Momentum in the investment market
- Chances of profit
- Volume assessment to know the popularity of the market
- Demand and supply trading theory
The crux lies in finding a right mix of the indicators for profitable decision. Too much of information might spoil the strategy. Use always best combination of indicators for day trading.
Oscillators
Oscillators type of indicators reflects up and down flow. Popular oscillators are Stochastics, CCI or Commodity Channel Index. Others are MACD and RSI.
Volume
Volume indicators are a mix of price data with volume. They determine how strong the trends in the terms of prices.
Overlays
Overlays indicators are Moving Averages and Bollinger Bands. Parabolic SAR and Fibonacci Extensions are other Overlays. Moving average determines trends. Fibonacci isto plan profit targets. CCI have a good number of uses like trends and trade triggers.
Breath Indicators
The Breath Indicators are stock market related. The major ones are Ticks, Tiki, Trin and also the Advance-Decline line. They relate to the sentiment of the traders. They reflect what the large part of the market is doing.
Bollinger Bands
This comprises three lines. The lines show moving average, lower limit, and the upper limit
Saturday, September 29, 2018
Tuesday, September 25, 2018
Monday, September 24, 2018
Tuesday, August 28, 2018
Inside Bar
What Is Inside The Inside Bar?
Our testing revealed that wide range inside bars (with range more
than 75% of the range of the preceding bars) out-performed our
benchmark by the largest margin. These are bars that barely make
it as inside bars and represent only a slight contraction.
We also found that inside bars that closed in our trade direction
seems to have an edge. Inside bars that support our trades did
considerably better than inside bars that did not.
The other two factors open-to-close spread and volume did not
show significant improvement.
We focused on wide range inside bars that closed in the direction
of our trade.
The results are encouraging. Most of the futures contacts show
an improvement of over 8%. This is a significant edge in the
competitive field of day trading. Of course, I must emphasis the
naive and simplistic assumptions we made. This includes the 1:1
risk to reward ratio and using the 20-period EMA as a trend filter.
Our results are not meant to be used in isolation as a complete
trading system. However, this is a good start to understand more
about inside bars that occur in day trading time frames.
Our testing revealed that wide range inside bars (with range more
than 75% of the range of the preceding bars) out-performed our
benchmark by the largest margin. These are bars that barely make
it as inside bars and represent only a slight contraction.
We also found that inside bars that closed in our trade direction
seems to have an edge. Inside bars that support our trades did
considerably better than inside bars that did not.
The other two factors open-to-close spread and volume did not
show significant improvement.
We focused on wide range inside bars that closed in the direction
of our trade.
The results are encouraging. Most of the futures contacts show
an improvement of over 8%. This is a significant edge in the
competitive field of day trading. Of course, I must emphasis the
naive and simplistic assumptions we made. This includes the 1:1
risk to reward ratio and using the 20-period EMA as a trend filter.
Our results are not meant to be used in isolation as a complete
trading system. However, this is a good start to understand more
about inside bars that occur in day trading time frames.
Relative Volume of Inside Bar
Relative Volume of Inside Bar
Our hypothesis is this: High volume inside bars contain more
activity which leads to stronger breakouts. “High” is relative, so we
compared the volume of the inside bar to that of its preceding bar.
In our testing, inside bars with volume higher than 75% of the
volume of the preceding bar are considered high volume inside
bars. Inside bars with volume lower than 25% of the volume of
the preceding bar are considered low volume inside bars.
Our hypothesis is this: High volume inside bars contain more
activity which leads to stronger breakouts. “High” is relative, so we
compared the volume of the inside bar to that of its preceding bar.
In our testing, inside bars with volume higher than 75% of the
volume of the preceding bar are considered high volume inside
bars. Inside bars with volume lower than 25% of the volume of
the preceding bar are considered low volume inside bars.
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