Technical Analysis for Beginners
- Thread starter veluri1967
- Start date
Sir,
Thanks for your valuable input for beginners.. You explained everything in a simple manner, if possible pls. add some chart with apply this pivot and indicator cross over. So that we get more clear picture and it will give a great help during our real time trade also. After look over the chart more doubt will raise for us and consult with you for better knowledge.
Thanks & Regards,
S.Saravanan.
Thanks for your valuable input for beginners.. You explained everything in a simple manner, if possible pls. add some chart with apply this pivot and indicator cross over. So that we get more clear picture and it will give a great help during our real time trade also. After look over the chart more doubt will raise for us and consult with you for better knowledge.
Thanks & Regards,
S.Saravanan.
Oooooops....
Though I do not personally like this indicator, but for the knowledge sake I find it more informative.
So here is
Stochastic
History
George Lane was the originator of the stochastic indicator in the 1970's. Lane observed that as prices increase in an up trend, closing prices tend to be closer to the upper end of bars and in a down trend closing prices tend to be nearer the lower end of bars. Lane developed stochastics to discern the relationship between the closing price and the high and low of a bar.
Typically used to identify overbought and oversold conditions the indicator consists of two lines: % K and %D. These two lines fluctuate in a vertical range between 0 and 100. Readings above 80 are considered overbought and readings below 20 are considered oversold.
Stochastics can also be used to generate buy and sell signals. When the faster %K line crosses above the slower %D line and the lines are below 20, a buy signal is generated. When the %K lines crosses below the %D line and the lines are above 80 a sell signal is generated.
My Own use Of Stochastics
Well, as usual just to be contrary to everyone else, I don't use the stochastic indicator to signal overbought or oversold although I do take note of the readings. I like to use it as possible buy and sell opportunities after defining a trend. If the trend is up I like to only take buy signals regardless of the reading as long as the trend remains in place. I ignore the sell signals. I purposefully weaken the stochastics to give me more signals and I use 8,3,3 as my settings.
This gives more signals and shows the hand of the weaker players. The same is true of selling in a down trend.
I ignore the buy signals and only take the sell signals. I don't use the stochastic indicator by itself as trading method as all the settings I have tried ultimately resulted in to many whipsaws.
Home work for the learners
Experiment with different settings and consider adding this indicator to your trading arsenal.
Wish u a great finder
veluri1967:clapping::thumb:
Though I do not personally like this indicator, but for the knowledge sake I find it more informative.
So here is
Stochastic
History
George Lane was the originator of the stochastic indicator in the 1970's. Lane observed that as prices increase in an up trend, closing prices tend to be closer to the upper end of bars and in a down trend closing prices tend to be nearer the lower end of bars. Lane developed stochastics to discern the relationship between the closing price and the high and low of a bar.
Typically used to identify overbought and oversold conditions the indicator consists of two lines: % K and %D. These two lines fluctuate in a vertical range between 0 and 100. Readings above 80 are considered overbought and readings below 20 are considered oversold.
Stochastics can also be used to generate buy and sell signals. When the faster %K line crosses above the slower %D line and the lines are below 20, a buy signal is generated. When the %K lines crosses below the %D line and the lines are above 80 a sell signal is generated.
My Own use Of Stochastics
Well, as usual just to be contrary to everyone else, I don't use the stochastic indicator to signal overbought or oversold although I do take note of the readings. I like to use it as possible buy and sell opportunities after defining a trend. If the trend is up I like to only take buy signals regardless of the reading as long as the trend remains in place. I ignore the sell signals. I purposefully weaken the stochastics to give me more signals and I use 8,3,3 as my settings.
This gives more signals and shows the hand of the weaker players. The same is true of selling in a down trend.
I ignore the buy signals and only take the sell signals. I don't use the stochastic indicator by itself as trading method as all the settings I have tried ultimately resulted in to many whipsaws.
Home work for the learners
Experiment with different settings and consider adding this indicator to your trading arsenal.
Wish u a great finder
veluri1967:clapping::thumb:
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