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Trading Strategy – Break and Backtest
Brake and backtests are pivotal in understanding good Technical Analysis (TA) and understanding the reliability of trends. We know that the longer a trend stays in place, the more reliable it becomes. However, that also means that the longer it stays in place, the more significant the break of that trend becomes when it eventually […]
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Regression Lines
Regression lines are a tool that allows you t see the extreme upper and lower range of the vast majority of price action.It takes a block a data and runs a calculation which gives you a clear picture of the range on which the prices fall between. This tool is useful to identify where the […]
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Moving Average
Moving Averages are calculations of the average price over the last X amount of time. They are a great way to identify the overall trend an asset is going, enabling get a good picture of the overall direction and trend of the market. In addition, moving averages are great for identifying reverses in a trend, […]
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Counter Trends
One strategy to look out for to enter a trading position is the counter trend. Counter trends are reverses in a larger pattern – so what we’re looking for is a slight reversal during a long term trend. For example, if the monthly trend is ascending and we suddenly see an hourly descending trend, this […]
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Issues with Patterns and Psychology
First of all, we find patterns in noise. The stock market is primarily just financial noise data, completely random and only punctuated by periods of psychology based trading or algorithms that are mirroring psychology based trading. We need to be conscious of these issues so that we can mitigate the risk that comes along with […]
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Patterns and Psychology of TA
Patterns are wonderfully beautiful configurations of price action that are really visually appealing and easy to recognize and often can result in fantastic trade opportunities. They are are collections of price action that are confined by support and resistance. And what’s very cool and very important is that they represent market psychology. There’s a lot […]