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eLEARN ON 4 TYPES OF INDICATORS
I was supposed to give some few tips on how to check some market movements through some of indicators which I Also use.
Bullish or Bearish indicators are classified depending on what they indicate; They either indicate;Volatility , Momentum, Volume and Trend.
I will give an example on each type.
Volatility Indictors show price action change in a given time,Tells nothing about direction but how the fast the price will change for you to make profit. Example is Bollinger bands.
Momentum indicators show how strong the trend is, with them you can detect when a pullback is going to occur or a reversal. Example is RSI indicator.
Volume indicators show how volume is changing with time like the OBV.
Trend indicators tell you which direction the market will be moving to like MACD. Mostly are oscillators.
I will cover an example on each in 4 episodes.
In Trading all indicators have their limitations and one can not depend only on 1 indicator , I will also show you on you can use several indicators combined.
EPISODE 1
Bollinger bands - Volatility Indicator.
They consist of a simple moving average, and 2 lines plotted at 2 standard deviations on either side of the central moving average line. The outer lines make up the band.
Simply, when the band is narrow the market is quiet. When the band is wide the market is loud.
Trading when market is trending, Bands try to squeeze to each other and that indicates that Breakout is about to happen either and Uptrend or down trend.
If the candles breakout below the bottom band, the move will generally continue in a downtrend.
If the candles breakout above the top band, the move will generally continue in an uptrend.
An example of Bollinger indicating a breakout.
Point to NOte:
If the candles breakout above the top band, the move will generally continue in an uptrend
If the candles breakout below the bottom band, the move will generally continue in a downtrend.
Bullish
Bearish
When Trading in a ranges when coin is maybe accumulating or distributing, Bollinger bands act as Resistance and support at that particular time. When you want to enter the market, You can always enter at the bottom of the lower band and sell at the top band to avoid a breakout which may happen which could be a down move or uptrend. If you enter for a long at the bottom of the range or short at the top of the range, The price naturally returns to the average as time passes.
That’s what Bollinger bands are all about; keep following, next episode is well lined up.
Bullish or Bearish indicators are classified depending on what they indicate; They either indicate;Volatility , Momentum, Volume and Trend.
I will give an example on each type.
Volatility Indictors show price action change in a given time,Tells nothing about direction but how the fast the price will change for you to make profit. Example is Bollinger bands.
Momentum indicators show how strong the trend is, with them you can detect when a pullback is going to occur or a reversal. Example is RSI indicator.
Volume indicators show how volume is changing with time like the OBV.
Trend indicators tell you which direction the market will be moving to like MACD. Mostly are oscillators.
I will cover an example on each in 4 episodes.
In Trading all indicators have their limitations and one can not depend only on 1 indicator , I will also show you on you can use several indicators combined.
EPISODE 1
Bollinger bands - Volatility Indicator.
They consist of a simple moving average, and 2 lines plotted at 2 standard deviations on either side of the central moving average line. The outer lines make up the band.
Simply, when the band is narrow the market is quiet. When the band is wide the market is loud.
Trading when market is trending, Bands try to squeeze to each other and that indicates that Breakout is about to happen either and Uptrend or down trend.
If the candles breakout below the bottom band, the move will generally continue in a downtrend.
If the candles breakout above the top band, the move will generally continue in an uptrend.
An example of Bollinger indicating a breakout.
Point to NOte:
If the candles breakout above the top band, the move will generally continue in an uptrend
If the candles breakout below the bottom band, the move will generally continue in a downtrend.
Bullish
Bearish
When Trading in a ranges when coin is maybe accumulating or distributing, Bollinger bands act as Resistance and support at that particular time. When you want to enter the market, You can always enter at the bottom of the lower band and sell at the top band to avoid a breakout which may happen which could be a down move or uptrend. If you enter for a long at the bottom of the range or short at the top of the range, The price naturally returns to the average as time passes.
That’s what Bollinger bands are all about; keep following, next episode is well lined up.
Disclaimer
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