Hi to all,
I have started learning TA. I had a few queries which i hope to be answered here by so many senior learned members of the forum.
1. When we talk abt 15/20/50 day simple moving averages for a weekly chart we will have 15/20/50 week average. Right. Now my question is in a 20 day weekly simple moving average do they take the closing prices of every week(mostly fridays) and divide the last 20 weeks closing price by 20 or they take closing price of every day of the week and divide it by 5 days and come with every weeks average and then find 20 weeks average. Sorry i am not able to ask this question in a concise form but i hope u will comrehend.
2. Also when we see different indicators like moving average and cross over moving average. what time period should we look at. Like 20 day moving average. Should we use different time periods for weekly chart and monthly chart. Are certain time periods more suitable to indian stocks or does it depend upon the market volatility.
3. In RSI to find RS we take Average Gain= Total Gains/N and Average Loss= Total Loss/N. In this we take maybe a 14 day period. can we change the period and if yes do we increase the period or reduce and what effect will it have. Difference between First RS and smoothed RS and which one is better to use.
4. finally I would like to know do we need to know the formulas and undertsand the logic behind the formulas or just getting used to the indicators and time periods to do our study is enough.
Regards
Rahul
I have started learning TA. I had a few queries which i hope to be answered here by so many senior learned members of the forum.
1. When we talk abt 15/20/50 day simple moving averages for a weekly chart we will have 15/20/50 week average. Right. Now my question is in a 20 day weekly simple moving average do they take the closing prices of every week(mostly fridays) and divide the last 20 weeks closing price by 20 or they take closing price of every day of the week and divide it by 5 days and come with every weeks average and then find 20 weeks average. Sorry i am not able to ask this question in a concise form but i hope u will comrehend.
2. Also when we see different indicators like moving average and cross over moving average. what time period should we look at. Like 20 day moving average. Should we use different time periods for weekly chart and monthly chart. Are certain time periods more suitable to indian stocks or does it depend upon the market volatility.
3. In RSI to find RS we take Average Gain= Total Gains/N and Average Loss= Total Loss/N. In this we take maybe a 14 day period. can we change the period and if yes do we increase the period or reduce and what effect will it have. Difference between First RS and smoothed RS and which one is better to use.
4. finally I would like to know do we need to know the formulas and undertsand the logic behind the formulas or just getting used to the indicators and time periods to do our study is enough.
Regards
Rahul