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Daily Candlestick Chart for MSVS
[img]stockcharts.com/c-sc/sc?s=MSVS
Bearish Reversal Candlestick Patterns: The Bearish Reversal Candlestick Pattern comes in over 12 different forms. These include the Abandoned Baby, the Bearish Engulfing Pattern, the Harami, the Dark Cloud Cover, the Evening Star and the Shooting Star. Bearish Reversal Candlestick Patterns should form in an uptrend and most will require Bearish Confirmation as reinforcement of the pattern. Use additional anaylsis to further support your findings.
Relative Strength: The price relative is a line formed by dividing the security by a benchmark. For stocks it is usually the price of the stock divided by the S
Daily Candlestick Chart for AGFL
[img]stockcharts.com/c-sc/sc?s=AGFL
Financial Analysis
The final step to this analysis process would be to take apart the financial statements and come up with a means of valuation. Below is a list of potential inputs into a financial analysis.
The list can seem quite long and intimidating. However, after a while, an investor will learn what works best and develop a set of preferred analysis techniques. There are many different valuation metrics and much depends on the industry and stage of the economic cycle. A complete financial model can be built to forecast future revenues, expenses and profits or an investor can rely on the forecast of other analysts and apply various multiples to arrive at a valuation. Some of the more popular ratios are found by dividing the stock price by a key value driver.
This methodology assumes that a company will sell at a specific multiple of its earnings, revenues or growth. An investor may rank companies based on these valuation ratios. Those at the high end may be considered overvalued, while those at the low end may constitute relatively good value.
Daily Candlestick Chart for RTXB
[img]stockcharts.com/c-sc/sc?s=RTXB
Convergence: Normally, the contract price of a futures contract is higher than the current price of the underlying asset (normally a commodity). The futures contract price is higher because of the effect of the time value of money. As the expiration date nears, the spread between the spot price and the futures contracts price becomes smaller and smaller. On the delivery date of the contract, the futures and spot prices should be equal.
This process of futures and spot prices approaching one another is called convergence
Daily Candlestick Chart for SNTL
[img]stockcharts.com/c-sc/sc?s=SNTL
Bullish Reversal Candlestick Patterns: The Bullish Reversal Candlestick Pattern has over 14 different pattern styles. These include the Bullish Engulfing, the Piercing Pattern, the Harami, the Hammer, the Inverted Hammer, the Morning Star, and the Abandoned Baby. To use Bullish Reversal Candlestick Patterns succesfully, look for the pattern in a downtrend and use Bullish Confirmation to validate your analysis. Further reinforce your results by using additional analysis to confirm the patterns.
Daily Candlestick Chart for RYPE
[img]stockcharts.com/c-sc/sc?s=RYPE
Daily Candlestick Chart for AUMY
[img]stockcharts.com/c-sc/sc?s=AUMY
Central Bank: Central banks play a key role in the currency markets because of their power over monetary policy. They have a direct influence over money supply, which in turn affects demand and price of the currency. Through the use of different policies, central banks can try to manipulate the markets so that they can keep their currency at specific levels. Some countries and their central banks try to peg their currency to that of another currency or basket of currencies (for example, China to the U.S.).
The central bank can participate in the forex market by buying and selling their currency at the spot market in order to keep it from changing too much. Another motivation for central banks is to keep the local currency at a specific price in order to make their local economy more attractive for international trade. If a country’s currency appreciates too quickly, it could actually make it less appealing to importers.
Remember that many transactions have to use the local currency. Thus, if currency that is needed rises too quickly, it effectively makes goods more expensive to foreigners, which in turn, hurts trade. To counter this, the central bank may intervene in the market by selling its currency and buying up other major currencies. This in effect, weakens the local currency so as to make it more appealing to foreign importers.
While the exact value of what percentage such central bank transactions take up isn’t known, take note that because these are the banks of national governments, such interventions can have a much larger impact on the market than any single commercial bank.
Short Selling Process
Here is the process:
Request the short sell from your brokerage.
Your brokerage will lend you the shares, if they have them available. It's not uncommon for the shares to be unavailable.
Your brokerage will immediately try to sell the shares on the stock market.
Cash from the sale goes into a special short-sell account that you cannot access. It is used as collateral for the shares that you borrowed.
Wait for the stock to go down.
Finish the trade by choosing "Buy to Cover." This action will buy shares from the market and return them to your brokerage. You will have made a profit if your short sale price was higher than your buy back price (minus any commissions).
Note that your brokerage may request that you return the shares at any time. They may need to return the shares to other customers.
Daily Candlestick Chart for ATDN
[img]stockcharts.com/c-sc/sc?s=ATDN
Daily Candlestick Chart for DEAR
[img]stockcharts.com/c-sc/sc?s=DEAR
How to Pick a Time Frame
The time frame used for forming a chart depends on the compression of the data: intraday, daily, weekly, monthly, quarterly or annual data. The less compressed the data is, the more detail is displayed.
Daily data is made up of intraday data that has been compressed to show each day as a single data point, or period. Weekly data is made up of daily data that has been compressed to show each week as a single data point. The difference in detail can be seen with the daily and weekly chart comparison above. 100 data points (or periods) on the daily chart is equal to the last 5 months of the weekly chart, which is shown by the data marked in the rectangle. The more the data is compressed, the longer the time frame possible for displaying the data. If the chart can display 100 data points, a weekly chart will hold 100 weeks (almost 2 years). A daily chart that displays 100 days would represent about 5 months. There are about 20 trading days in a month and about 252 trading days in a year. The choice of data compression and time frame depends on the data available and your trading or investing style.
Daily Candlestick Chart for EXPU
[img]stockcharts.com/c-sc/sc?s=EXPU
Daily Candlestick Chart for GSML
[img]stockcharts.com/c-sc/sc?s=GSML
British Industrial Production: Release Schedule: 8:30 (GMT); monthly, usually 26 working days following the reporting month's end
Revisions Schedule: Monthly revisions made to adjust for incomplete data.
Source of Report: Office for National Statistics (UK)
Web Address: http://www.statistics.gov.uk/default.asp
Address of release: http://www.statistics.gov.uk/statbase/Product.asp?vlnk=6230
Conclusion
Identification of key support and resistance levels is an essential ingredient to successful technical analysis. Even though it is sometimes difficult to establish exact support and resistance levels, being aware of their existence and location can greatly enhance analysis and forecasting abilities. If a security is approaching an important support level, it can serve as an alert to be extra vigilant in looking for signs of increased buying pressure and a potential reversal. If a security is approaching a resistance level, it can act as an alert to look for signs of increased selling pressure and potential reversal. If a support or resistance level is broken, it signals that the relationship between supply and demand has changed. A resistance breakout signals that demand (bulls) has gained the upper hand and a support break signals that supply (bears) has won the battle.
Daily Candlestick Chart for ATYG
[img]stockcharts.com/c-sc/sc?s=ATYG
DeMarker Indicator: The Demarker Indicator is a technical analysis tool developed by Tom Demarker for identifying high-risk buying or selling areas in a given market.
Two variants of the Demarker Indicator exist, one bounded by values from -100 to 100, the other bounded by values from 0 to 1. The basic principle behind the Indicator is the same in either case. If the high price for a period is higher than the previous period's high, the DeMax variable for that period is the difference between the highs; the DeMin variable for the period works similarly for the low prices. The Demarker Indicator is then the moving average of DeMax divided by the sum of the moving averages of DeMax and DeMin. Thus, the higher the value of DeMax relative to DeMin, the greater the value of the Demarker Indicator.
On the 0 to 1 Demarker Indicator scale, a value anywhere above .7 indicates that a downward price turn is imminent, while a value anywhere below .3 indicates that the price will shortly turn upward. Values between .3 and .7 indicate relatively low-risk periods for entering a given asset market. Thus savvy traders can use the Demarker Indicator either to determine when to enter a market, or when to buy or sell an asset in order to capitalize on probable imminent price trends.
Runaway Gaps
Runaway gaps are also called measuring gaps, and are best described as gaps that are caused by increased interest in the stock. For runaway gaps to the upside, it usually represents traders who did not get in during the initial move of the up trend and while waiting for a retracement in price, decided it was not going to happen. Increased buying interest happens all of a sudden, and the price gaps above the previous day's close. This type of runaway gap represents an almost panic state in traders. Also, a good uptrend can have runaway gaps caused by significant news events that cause new interest in the stock. In the chart below, note the significant increase in volume during and after the runaway gap.
Ford Motor Co. (F) Runaway Gap example chart from StockCharts.com
Runaway gaps can also happen in downtrends. This usually represents increased liquidation of that stock by traders and buyers who are standing on the sidelines. These can become very serious as those who are holding onto the stock will eventually panic and sell – but sell to whom? The price has to continue to drop and gap down to find buyers. Not a good situation.
The term measuring gap is also used for runaway gaps. This is an interpretation that is hard to find examples for, but it is a way of helping one decide how much longer a trend will last. The theory is that the measuring gap will occur in the middle of, or half way through, the move.
Sometimes, the futures market will have runaway gaps that are caused by trading limits imposed by the exchanges. Getting caught on the wrong side of the trend when you have these limit moves in futures can be horrifying. The good news is that you can also be on the right side of them. These are not common occurrences in the futures market despite all the wrong information being touted by those who do not understand it, and are only repeating something they read from an uninformed reporter.
Daily Candlestick Chart for GAEC
[img]stockcharts.com/c-sc/sc?s=GAEC
Bank of England: The Bank of England is the central bank of the United Kingdom. Sometimes known as the 'Old Lady' of Threadneedle Street, the Bank was founded in 1694, nationalised on 1 March 1946, and gained independence in 1997. Standing at the centre of the UK's financial system, the Bank is committed to promoting and maintaining monetary and financial stability as its contribution to a healthy economy.
The Bank of England has been in place for more than three hundred years, although it wasn't nationalized until 1946. It serves a dual role as both a consumer bank and a government bank. As such, the "Old Lady of Threadneedle Street," as the Bank of England is often called, holds a primary role in the financial status of the United Kingdom.
In 1998 the bank's governing body was changed by the Bank of England Act. Now the Bank of Directors is composed of sixteen non-executive directors, two deputy governors, and the bank's governor. This has modified the bank's responsibilities; their two main purposes now include maintaining the UK's Monetary and financial stability, although it still has as many small-scale account holders as it does large corporate accounts.
In regards to the foreign exchange market, the Bank of England manages the Exchange Equalisation Account. The EEA was formed in 1932 and is the account responsible for influencing the exchange rate of the UK's gold reserves. It also holds foreign currencies and gold for trading purposes
Daily Candlestick Chart for DEYU
[img]stockcharts.com/c-sc/sc?s=DEYU
ADX: The average directional index, or ADX, was developed by J. Welles Wilder as a measure of a current market trend's strength. The ADX is derived from two directional indicators, known as DI and DI-, which are in turn derived from the directional movement index (DMI).
ADX is calculated by finding the difference of DI and DI-, as well as the sum of DI and DI-. The difference is divided by the sum, and the resulting number multiplied by 100. The product is known as the directional index, or DX. A moving average is then taken of DX, typically over a fourteen-day period (although any number of periods can be used.) This final moving average is the ADX.
The ADX takes the form of a number from 0 to 100. A value of 0 indicates that the market is equally likely to move in either a positive or negative direction, meaning that there is no overall market trend. A value of 100 indicates that the market is exclusively moving in either a positive or negative direction, indicating an extremely strong trend. Values of greater than 60 are uncommon in practice, and any value of greater than 40 is considered to be a strong trend. Any value less than 20 is considered to be a weak trend, and may signal an upcoming reversal. Because the ADX is derived from both positive and negative directional indicators, it only measures the magnitude of a trend rather than its direction.
Bar Chart
Perhaps the most popular charting method is the bar chart. The high, low and close are required to form the price plot for each period of a bar chart. The high and low are represented by the top and bottom of the vertical bar and the close is the short horizontal line crossing the vertical bar. On a daily chart, each bar represents the high, low and close for a particular day. Weekly charts would have a bar for each week based on Friday's close and the high and low for that week.
Bar charts can also be displayed using the open, high, low and close. The only difference is the addition of the open price, which is displayed as a short horizontal line extending to the left of the bar. Whether or not a bar chart includes the open depends on the data available.
Bar charts can be effective for displaying a large amount of data. Using candlesticks, 200 data points can take up a lot of room and look cluttered. Line charts show less clutter, but do not offer as much detail (no high-low range). The individual bars that make up the bar chart are relatively skinny, which allows users the ability to fit more bars before the chart gets cluttered. If you are not interested in the opening price, bar charts are an ideal method for analyzing the close relative to the high and low. In addition, bar charts that include the open will tend to get cluttered quicker. If you are interested in the opening price, candlestick charts probably offer a better alternative.
Daily Candlestick Chart for CIIC
[img]stockcharts.com/c-sc/sc?s=CIIC
Day Trading
Most stocks only fluctuate 1-2% every day. So if you put $1,000 into the stock and made a profit of 1%, that would only be $10. Now if you put $50,000 into the stock, you would make $500. That is where the danger in day trading lies, however. Let's say the company suddenly reported bad news or something major happened in the financial world and your stock drops 8%. You just lost eight times your normal profit of 1%, which would be $4,000 on a $50,000 investment.
Daily Candlestick Chart for LQMT
[img]stockcharts.com/c-sc/sc?s=LQMT
Daily Candlestick Chart for CTIX
[img]stockcharts.com/c-sc/sc?s=CTIX
Daily Candlestick Chart for SUTI
[img]stockcharts.com/c-sc/sc?s=SUTI
Accumulative Swing Index: The accumulative swing index, or ASI, is a tool developed by J. Welles Wilder to measure the breakout potential of a given market.
The ASI takes the form of a number from 100 to -100, with positive values indicating an upward trend and negative values indicating a downward trend. Once calculated, the ASI can be charted in conjunction with a candlestick chart. The chief value of the ASI is that it's susceptible to the same technical analysis tools as a candlestick chart, allowing traders to use trendlines, wedges, triangles and other tools in order to determine support and resistance levels. However, ASI charts are much simpler and smoother than candlestick charts, making them both easier to analyze and less susceptible to indicating false breakouts. If the absolute value of the ASI for a given day exceeds the absolute value of the ASI at the time of a previous breakout, a new breakout from the trend is imminent, and traders can take positions accordingly.
The ASI is based on Wilder's swing index, which is an extremely complex calculation that incorporates high, low and close prices for an asset along with numerous other variables, some of them specific to certain kinds of markets. On its own, the swing index isn't particularly useful as a predictive tool, but the swing indexes for several successive days can be incorporated by another calculation into the ASI, which fulfills Wilder's original intention for the measure. Full instructions for calculating the swing index and ASI are available in Wilder's "New Concepts in Technical Trading Systems", and a number of popular pieces of trading software are able to calculate the ASI automatically.
The graph above shows the economic cycle in green, the stock market cycle in red and the best performing sectors at the top. The green economic cycle corresponds to the business cycle shown above. The centerline marks the contraction/expansion threshold for the economy. Notice how the red market cycle leads the business cycle. The market turns up and crosses the centerline before the economic cycle turns. Similarly, the market turns down and crosses below the centerline ahead of the economic cycle.
Daily Candlestick Chart for MWIP
[img]stockcharts.com/c-sc/sc?s=MWIP
Biflation: Biflation is a phenomenon where both inflation and deflation occur at the same time. This term was coined by Dr. Osborne Brown, a Senior Financial Analyst for the Phoenix Investment group.
During biflation, the prices of commodities and earnings-based assets (equities) rise while the prices of debt-based assets (bonds) fall
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