March 25, 2017: New comments S&P500
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Twice semi-finalist "Favorite Article" in the S&C 2015 Readers' Choice Award. Thank You!
AXIOM business books awards, bronze medal for my book! Thank You!
The basic ATR trailing stop trading method formula will switch from support to resistance and visa-versa when breaking support or resistance. For the ATR trailing stop method we calculate the maximum allowed loss based on the basic ATR function multiplied by a factor. HERE is the the formula.
Heikin-ashi, Japanese for “average bar”, is a technique using a special kind of candle stick bars for better visualizing price trends. This technique has been introduced by Dan Valcu in the February 2004 issue of Stocks & Commodities magazine. This indicator calculates the average heikin-ashi closing price?
The Smoothed Stochastic Invers Fisher Transform uses a rainbow smoothed closing price for creating a slow stochastic. Next, this stochastic is transformed to a fast switching high to low and low to high value by an invers Fisher Transform function. This creates clear entry and exit points based on the slow stochastic.
I have found that about 99% of the time, any move in the financial markets is composed of three or more up or down waves. The 1-2-3 wave count is based on this finding. To help count these waves, I will introduce a high-low zigzag indicator that is based on a fixed-percent price change between high and low pricesprices, or that uses an average true range (ATR) volatility factor. I have found that a combination of both methods makes a good indicator.
One of the rules for my swing trading strategy (IRSTS) involves recognizing a candlestick pattern at pivot points. There are several reversal patterns that could occur at these turning points, but I have observed one pattern that I could not find in the literature on candlestick patterns. I will introduce you to this pattern.
One of the indicator rules for my swing trading strategy (IRSTS) is to catch potential reversal points using the upper and lower boundaries of volatility bands.
When I created my zero-lag oscillator (SVEZLRBPercB), which is based on the Percent b, I used the same basic formula as the Percent b. However, before applying the formula, I manipulated the input data I used. In a July 1997 Stocks & Commodities article, Mel Widner introduced rainbow charts, which is the technique I used to convert the closing price data to a "rainbow" data series and give some extra weight for the less-smoothed data.
When in doubt, follow the expert — except that this expert is a trading system that will make your buy & sell decisions easier. Keep in mind there is no perfect expert that will make profitable trades all the time.
The IRSTS seven-part series has provided the components of the indicator rules for a swing trading strategy, from color-coding candlesticks to smoothing oscillators to creating an expert system. Now that all of the components have been detailed, here's how you can put this swing trading strategy to use in your trading.
What type of chart should you be using? Lines, bars, candlesticks… there are so many choices. In this first part of a six-part series, an overview of charting styles is presented that may help you make the right choice for analyzing the markets. Many types of charts are available to the trader. Here, I will look at the most common ones as well as some special ones.
Creating our own indicators and turning them into a trading strategy is something all technical analysts strive to do. Unfortunately, a lack of programming skills can often discourage us from accomplishing this. But there are ways to get around it. Here’s one way to create and backtest an indicator without writing any code.
Price projections estimate future price levels. I discussed already some basic price projection techniques based on support & resistance and trendlines. But there are also other methods to project prices. I’ll start with measured moves.