AI
Sunday, October 01, 2017 1:02:44 AM
If I could give just one charting lesson...
There are an infinite number of chart set-ups that will make money- but you only need to master one that appeals to you to make money consistently.
While I do enjoy the more intricate charts (and use them), my favorites are the simple ones- just two moving averages, and maybe a set of bollinger bands.
Three indicators are all you need... MACD and ADX when placed one on top of the other form recognizable patterns. Look for macd to be arching up, and for adx to be climbing. When ADX line is over 20 and coasting between the green and red you might have something special
MFI is my preferred money flow indicator. Note that I use three different time periods- overlayed in pretty colors
Ideally, if price is breaking out the indicators should also be breaking out- ideally.
Heikin-Ashi candles are used to weed out the excess noise... you want everything to be as smooth as possible- at least i do... i don't like surprises haha
To familiarize yourself with what to look for you want to study the winning charts- look at what ran- look at what they looked like before they ran (stockcharts provides a way to do this)... stare at them over and over until you understand their language.
Of all the patterns there is nothing like a classic breakout- it's a timeless pattern that works on any interval- daily, weekly, 30 minute, 1 minute- whatever. Determine how long you want to hold then use the appropriate chart interval. You get a spike on high volume- some sideways consolidation- then a new high is made on high volume. That's it, that's all there is to it! lol
(the problem of course is... emotions, fear, greed, hope, and actually being there when the breakout happens, among other things haha)
Without getting too deep into what bollinger bands are and why they work I will just say that you are looking for a pinch and expansion- the pinch is when the two lines face each other and the expansion is when they are pointing opposite directions... pinch and expansion, pinch and expansion, burn it into your brain.
Two moving averages can be very telling- a simple 5 and 10 are a good start- they should both be pointing north.
Ok here are three stocks that ran this week... note that they all share the same qualites of MACD arching, ADX climbing, MFI is high and strong, and above average VOLUME was present when the bollinger bands began to expand from a pinch. Stare at these charts- take mental notes of each candle of each day- what were the bollinger bands doing, what were the moving averages doing, etc... there are a hundred charts that right now look like these did before the run (on some time interval)... if you find one you get a prize- a cash prize... get to work!
Smooth, sinuous charts trading a lot of volume are the best- enjoy!
There are an infinite number of chart set-ups that will make money- but you only need to master one that appeals to you to make money consistently.
While I do enjoy the more intricate charts (and use them), my favorites are the simple ones- just two moving averages, and maybe a set of bollinger bands.
Three indicators are all you need... MACD and ADX when placed one on top of the other form recognizable patterns. Look for macd to be arching up, and for adx to be climbing. When ADX line is over 20 and coasting between the green and red you might have something special
MFI is my preferred money flow indicator. Note that I use three different time periods- overlayed in pretty colors
Ideally, if price is breaking out the indicators should also be breaking out- ideally.
Heikin-Ashi candles are used to weed out the excess noise... you want everything to be as smooth as possible- at least i do... i don't like surprises haha
To familiarize yourself with what to look for you want to study the winning charts- look at what ran- look at what they looked like before they ran (stockcharts provides a way to do this)... stare at them over and over until you understand their language.
Of all the patterns there is nothing like a classic breakout- it's a timeless pattern that works on any interval- daily, weekly, 30 minute, 1 minute- whatever. Determine how long you want to hold then use the appropriate chart interval. You get a spike on high volume- some sideways consolidation- then a new high is made on high volume. That's it, that's all there is to it! lol
(the problem of course is... emotions, fear, greed, hope, and actually being there when the breakout happens, among other things haha)
Without getting too deep into what bollinger bands are and why they work I will just say that you are looking for a pinch and expansion- the pinch is when the two lines face each other and the expansion is when they are pointing opposite directions... pinch and expansion, pinch and expansion, burn it into your brain.
Two moving averages can be very telling- a simple 5 and 10 are a good start- they should both be pointing north.
Ok here are three stocks that ran this week... note that they all share the same qualites of MACD arching, ADX climbing, MFI is high and strong, and above average VOLUME was present when the bollinger bands began to expand from a pinch. Stare at these charts- take mental notes of each candle of each day- what were the bollinger bands doing, what were the moving averages doing, etc... there are a hundred charts that right now look like these did before the run (on some time interval)... if you find one you get a prize- a cash prize... get to work!
Smooth, sinuous charts trading a lot of volume are the best- enjoy!
People who say it cannot be done should not interrupt the person doing it.
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