Archive for american stock
May 23, 2008 at 1:22 pm
· Filed under Sigma capital markets, american stock, automated trading, chart, currency trading, exchange mini, flexible forex, foreign, interest rate, leading industrial nations agree algorithmic trading, market rate, mini forex, new, trading Sigma charts interest rate automated trading, trading Sigma charts
| Commodity Channel Index (CCI) |
CCI has been developed by Donald Lambert; it designed to detect beginning and ending market trends & provides an indication of overbought or oversold markets.
The CCI indicates the increasing in the prices compared to average prices as it moves towards +100.
As the CCI drops towards -100, it indicates that the price is increasingly low compared to average prices.
It provides a warning of overbought and oversold markets when the line crosses the +100 or the -100 levels.
The actual buy or sell signal is usually provided, however, when the line then crosses back over the +100 or -100 level.
Buy signals are generated when CCI dropped below -100 & then come back up through this level.
Sell signals are generated when CCI dropped below +100 or make strong thrust above +100 & then dropped back up through this level.
Zero line crossings it confirms buy or sell signals.
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May 23, 2008 at 1:21 pm
· Filed under Sigma capital markets, american stock, automated trading, chart, currency trading, exchange mini, flexible forex, foreign, interest rate, leading industrial nations agree algorithmic trading, market rate, mini forex, new, trading Sigma charts interest rate automated trading, trading Sigma charts
J Welles Wilder has developed the Average Directional Index (ADX) to define trend force, whether the trend will develop further or will gradually weaken.
The simplest trading method based on the system of directional movement implies comparison of two direction indicators: the 14-period +DI (yellow) one and the 14-period –DI (Green). To do this, one either puts the charts of indicators one on top of the other, or +DI is subtracted from -DI. W. Wilder recommends buying when +DI is higher than -DI, and selling when +DI sinks lower than -DI.
To these simple commercial rules Wells Wilder added “a rule of points of extreme”. It is used to eliminate false signals and decrease the number of deals. According to the principle of points of extreme, the “point of extreme” is the point when +DI and -DI cross each other.
- If +DI raises higher than -DI, this point will be the maximum price of the day when they cross.
- If +DI is lower than -DI, this point will be the minimum price of the day they cross.
The point of extreme is used then as the market entry level.
Thus, after the signal to buy (+DI is higher than -DI) one must wait till the price has exceeded the point of extreme, and only then buy.
However, if the price fails to exceed the level of the point of extreme, one should retain the short position.
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May 23, 2008 at 1:19 pm
· Filed under Sigma capital markets, american stock, automated trading, chart, currency trading, exchange mini, flexible forex, interest rate, leading industrial nations agree algorithmic trading, market rate, mini forex, new, trading Sigma charts interest rate automated trading
Parabolic Stop and Release was developed by J Welles Wilder. It is made up of a series of evolving points called Stop and Reverse (SAR) points. The position is reversed when the protective stop is triggered.
Parabolic SAR is more popular for setting stops than for establishing direction or trend.
Parabolic SAR is base on the following rule: to shift the levels of closing prices only in direction of opened position. If there is a long position opened before, it is possible to increase the level of closing prices, but not to decrease it. If the short position is opened, it is possible to decrease the level of closing prices. Once a Parabolic SAR is reached, the current position is exited and a new position in the opposite direction is taken.
Signal to buy is given when the upper SAR crosses the price line.
Signal to sell is give when the lower SAR crosses the price line.
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