The relative strength index (RSI),one of the most well-known technical indicators, created by J. Welles Wilder and published in a 1978 book, New Concepts in Technical Trading Systems, and in Commodities magazine (now Futures magazine) in the June 1978 issue. Continue reading
Support/Resistance breakouts are used by traders as buy/sell signals. However, often times a stock breaking out of a resistance or support line can lead to false breakouts. One situation this can occur is if too many resistance or support lines are very close together. When this happens, it is best to club nearby lines and treat them as a support or resistance zone rather than trade them separately.
We are pleased to announce a new release of Investar, Version 5.2 with the Auto-SR addon and other features. A new video explaining the usage of the key features is available, “What’s New in Investar 5.2“. The Auto-Support/Resistance addon features are demoed in Using Auto-Support/Resistance .
This article discusses the need for Auto-Support/Resistance and why it makes it incredibly easy for all those traders who want to use Support/Resistance strategies in their trading.
Pivot Points are theoretical support and resistance levels based on the previous day’s open, high, low and close values: PP,R1,R2,R3,S1,S2,S3. PP is the Pivot Point, R1,R2,R3 are resistance levels, and S1,S2 and S3 are support levels. They are only valid as support and resistance levels for intraday trading. Pivot Levels can be calculated based on Classic, Camarilla or Woodie based formulae. Continue reading
Open Interest is the third most important indicator after price and volume. It is defined as is the number of contracts outstanding at the end of a day. Open Interest is very important for any Future and Option Trader. Continue reading
Futures and Options are also called derivatives because their prices depend on some underlying entity. In case of the NSE Futures and Options, the underlying entity is usually the stock or index. This post is a beginner guide for those who are trading in equities but want to venture into Futures. Continue reading
In a previous post, we had explained about the two main type of technical indicators: oscillators and trending indicators, giving an example of an oscillator (RSI) and a trending indicator (EMA) and shown the reader how the Buy/Sell signals occur in each. Each of the indicators have there pros and cons, but which one is better to use? Rather than using one or the other, in this blog post we will talk about a strategy where we show how a combination of an oscillator and a trending indicator can be used to greatly minimize false signals. Continue reading
Many times I have heard statements from traders who say something like, “I bought XYZ stock with the intention of day trading, but because it turned it into a loss, I converted it into delivery (i.e. a short-term to long-term investment).” This kind of strategy is a recipe for disaster for any portfolio and let me explain why. Continue reading