Commodity Channel Index (CCI)

The commodity channel index (CCI) is an oscillator originally introduced by Donald Lambert in 1980. Since its introduction, the indicator has grown in reputation which is currently a very common tool for traders in identifying cyclical trends not just in commodities, but also equities and currencies.

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Accumulation Distribution Line Indicator

The accumulation/distribution line or accumulation/distribution index (ADL), formulated by Marc Chaikin is a technical analysis indicator meant to relate price and volume in the stock market and also works like a leading indicator of price movements.

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Understanding On-balance volume (OBV)

On-balance volume (OBV) is a technical analysis indicator which is designed to correlate price and volume in the stock market. OBV measures buying and selling pressure as a cumulative indicator that adds volume on up days and subtracts volume on down days. When the security closes higher than the previous close, all of the day’s volume is considered up-volume. When the security closes lower than the previous close, all of the day’s volume is considered down-volume.

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Importance of Volume

Volume is among the most basic and effective concepts to understand when trading stocks. Volume is actually the number of shares (or contracts) that trade over a certain period of time (e.g.a day for daily timeframe). The higher the volume, more active the shares. Volume plays a significant role in the buying and selling of the stocks. Most traders combine the volume with the price of the stock to take the trading decision.

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Ichimoku : How to use Ichimoku Indicator

Ichimoku Kinko Hyo called Ichimoku is a technical analysis method that builds on candlestick charting to improve the accuracy of forecast price moves. The indicator was developed by Goichi Hosoda, a Japanese journalist. He spent 30 years perfecting the technique before releasing his findings to the general public in the late 1960s. Continue reading

Stochastic Oscillator : How to use Stochastics

Stochastics Oscillator is a momentum oscillator that helps to measure the current price in relation to its price range over a period of time. It functions as an overbought/oversold oscillator. It consists of 2 lines (%K & %D). Continue reading

Fibonacci Retracements : How to use Fibonacci Retracements

Fibonacci retracement is a method of technical analysis for determining support and resistance levels. Fibonacci retracement is based on the possibility that markets will retrace a predictable portion of a move, after which they will continue to move in the original direction. The Fibonacci retracements example can be valuable for swing traders to distinguish reversals on a stock chart. They are named after their use of the Fibonacci sequence. Continue reading

How to use MACD

Moving average convergence/divergence- MACD is one of the most reliable trading indicator used in technical analysis, created by Gerald Appel in the late 1970s. MACD indicator demonstrates the duration of a trend, strength, direction, and momentum of the price changes which helps in foreseeing a perfect entry/exit point for a trade. Continue reading