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Moving Averages

Moving Average/Support/Resistance ExampleHere's a great example on how you can use a moving average to watch for trend reversals and to trigger trades in case you don't like drawing a lot of lines on your chart. In this example, when the 50 Moving Average (MA) crossed the 200MA in May 2019, it signaled a bearish reversal (known as a bearish cross). Later, in November 2020, it crossed again signaling a bullish cross and an uptrend. If you had shorted the stock, you would've gotten around 60% gain. Now, if I was in this trade right now, it's near a recent high and just poked over a global (weekly chart) resistance line, so if it fails to stay on top of that, instead of turning into support for a continued uptrend, it may stay as a resistance level and begin a downtrend. Watch for consolidation at it's current level and be ready to change your strategy.
NASDAQ:ANGOEducation
by collintwols
A Quick Guide to Multi-Timeframe ScalingQuick Intro =========== Regardless of what type of trader we are, most of us will look at the same chart in different timeframes to help make the "case for a trade". The risk of doing so is that we need to understand the fundamental concept of Multi-Timeframe Scaling (let's call it MTF scaling) as we inspect the various timeframe charts of the same underlying, otherwise, we risk receiving confusing signals - that rather than helping a trade decision, will possibly hinders the decision, if not even triggering the wrong decision. This concept has possibly been published about here before - i though it won't harm to put together a quick primer / reminder if it helps some of our new fellow traders on TradingView - if this sounds interesting, please read on. What do I mean by Multi-Timeframe Scaling? ------------------------------------------------------- in my trading, and as i check if there's a good trade to make on, say TSLA- i would first look at the daily chart -- cause i'm a position trader. is there a trend forming? has there been a recent consolidation? is there a possible breakout soon ? ..etc i then "zoom-out" to a larger timeframe -- say the weekly chart. i need to see the prevailing sentiment and the "context" - this is important because even if it looks like a bottom is forming on the daily, if TSLA on the weekly shows a diminishing momentum, i would avoid making a long trade assume the larger (weekly) timeframe is favorable -- so i will then "zoom-in" to find an ideal entry - using a smaller timeframe chart - the 1hr or 15mins so what did we do here: ===================== Larger timeframe = Context and prevailing sentiment Medium timeframe = Trade Decision Shorter Timeframe = Trade Execution i will do the same for exits as well - i assume most traders have a similar "protocol" before they hit the trigger - but may use different "preferred set of timeframes" based on the type of trading -- day traders may use 15min for trading, with 1min for execution and 1 or 2Hrs for context -- swing traders may use 1hr for trading, with 10 mins for execution and 1 day for context and so on .... the problem for many traders, as they switch between the charts of various timeframes is, they will see conflicting signals .. the indicators/charts many of us use are usually not "sync'ed" - to demonstrate how this looks like, look at the chart on top - to demonstrate what happens when there's lack of indicator scaling across the timeframes, i used a 3-SMA basic system -- but the same concept applies for any indicators you use (RSI, MACD, ADX/DMI, Stochastic)....etc -- the list goes on :) -- so what's wrong here and how can it be fixed? ---------------------------------------------------------- There's nothing "really" wrong, it's just there's an element at play that we may not be aware of here - We need to get very familiar with that concept of "MTF scaling" when we switch between different TF charts - the concept is really simple, and the key is the "scale factor" the 1 day chart has 7 x 1hr bars (for stocks) -- so, for example, if i look at an SMA or EMA of length 9 on the daily chart, i need to look at the
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NASDAQ:TSLAEducation
by RedKTrader
67
Popular Trading Indicators (Simply) ExplainedEvery full-time trader knows that rule number 1 in this business isn't to make money; rule number 1 is: don't lose money. Hence, any successful, long term trading strategy must inherently focus on managing risk. I know that lately the word risk carries next to no meaning, and that's because the more risk you take, the more you're rewarded, while those who manage their risk, and are potentilly risk averse in general, pay the price (in purchasing power terms). Having said that, in this context, trading with risk in mind is critical to following rule number 1, and it's essential to managing your risk exposure, and creating a sustainable, successful trading strategy. Moving averages (MA): Sifting through dozens of mathematical functions to help understand, and predict price action can be very challenging. But, having an understanding of why we use certain indicators is a great place to start. Let's begin by talking about MAs. The name is self-explanitory, of course, and it's not much more complicated than that. When we're looking at a MA, what we're seeing is an average of the price over a specified period of time. Now, you could say that using a 20 day simple MA is better than using a 21 day exponential MA (which places more emphasis on recent PA). But, this is a moot conversation, because we don't actually know what they mean until we explore what the MAs reveal for the timeframe being analyzed. By knowing and focusing on industry standard MAs, we can see what larger institutional desks might be seeing, and those MAs include the 20 day MA (20DMA), 50 day MA (50DMA), 100 day MA (100DMA), and the 200 day MA (200DMA). When we apply these MAs across multiple timeframes to derive a thesis on price action, it all starts to make sense, and you can see these industry benchmarks being respected on the longer time frames, clearly. However, when you look at price action post 2008, it's almost as if the intraday MAs are seemingly ignored completely. The HFT EFT flows are so heavy and they distort price so drastically, imo it's a losing battle trying to day trade based on intraday MAs. Relative Strength Index (RSI): The relative strength index (RSI) is a great momentum indicator used to gauge whether or not a financial instrument is overbought or oversold. It's analyzed as a line graph with a range of 0 to 1, the latter being the top of the range, with overbought conditions identified at a value of greater than 0.70, and oversold conditions being observed with a value of 0.30 or lower. These polar extremes often indicate that a reversal is about to occur. Fibonacci Retracement (Fib): The Fib is a very popular and is used to gauge the magnitude of a price retracement. For example, if a stock falls 25%, and then bounces hard on high demand, we could apply a Fib to benchmark the move against previous, similar moves. How the Fib works, is it uses a mathematical formula which adds the previous two number together to get the next. For example, starting at 0, the Fibonacci sequence is as follows: 0, 1, 1, 2, 3, 5, 8, 13, 21, etc.. Within the Fib indicator, there are 5 key levels to watch after you've applied the 0 and 1 ranges to your price move, which includes the 0.236, 0.382, 0.5 (not officially included but useful), the 0.618, and finally the 0.786. Typically, I divide the asset price by the money supply (M2), to find tradable Fib levels (a lot of price distortion currently as I mentioned). Volume: When the price of an underlying security changes, what we're witnessing is the demand and supply (discovery) process. While this does tell us a lot, volume tells us the power of the move, and hence also the weakness of a move. For example, when we're seeing price rise as volume falls, the power of the move is diminishing, therefore it tells us that the move/trend could be nearing exhaustion. Placed together with other indicators that may also be flashing "red" could help us make better, and more informed decisions. In forex, however, volume points to the number of price changes which occured within the specified time interval. This is a bit different than stock or bond price volume, but essentially speaks to the depth of the market as well as the participation rate, just as it's peer does.
AMEX:SPYEducation
by Hedge_Of_The_World
4
Alligator Indicator (How To Use It)Alligator is the indicator which is designed to show a trend absence, its formation and direction. Bill Williams saw metaphorical resemblance between alligator’s behavior and the allegory of the market’s one: sleeping gives way to price-hunting after which it’s again time to sleep. The longer the alligator sleeps the hungrier it becomes and logically, the stronger the market movement will be. The indicator includes 13-, 8- and 5-period smoothed moving averages each with its own displacement (8, 5 and 3 bars respectively) which are colored blue (jaws), white (teeth) and red (lips) thus representing the alligator’s jaw, teeth and lips. Alligator is sleeping when the three averages are intertwined progressing in a narrow range. Therefore, more distant averages indicate sooner price movement. To Buy: If the averages go on in an upward direction (red followed by white and blue) this shows an emerging uptrend interpreted as a signal to buy. To Sell: If the averages go on in an downward direction (red followed by white and blue) this shows an emerging downtrend interpreted as a signal to sell. See two examples on GBPUSD 15 minute chart: 1st) possible sell trade was during Tokyo session, with low liquidity and low volume, for 50 pips. Would or should you trade this? No or Yes. 2nd) possible buy trade was during London and NY session, with high liquidity and high volume, for 70 pips. Would or should you trade this? No or Yes. You can use just 15 minute naked charts with only this Alligator Indicator on it. If These alligator lines are in correct buy or sell order during either London session or London/New York overlap session- I would highly recommend you make this trade. Alligator Indicator can be used on all charts.
Education
by Anbat
5
Asynchronous BB Timeframe Indicator - BTCUSDTThis indicator allows you to draw Bollinger bands using higher timeframes. Note: The timer of your Bollinger Bands must be a multiple of the current chart of the chart. For example: If your chart is 4 h and you set the sync value to 3, the Bollinger Bands will be drawn with a 12H time frame. 3 * 4H = 12 If the sync is equal to 1, normal Bollinger bands are drawn and will be no different from the normal Bollinger band. Using this indicator may be appropriate for fractal perspectives. Indicator name: Asynchronous Bollinger bands - Async BB
Education
by Chikamoto
TradingPit Scalping Strategy - EUR/USD 15MThe strategy uses a short (30) and long period (200) exponential moving average which you can both change in the settings. The strategy is trend following and designed to only trade in the direction of the trend. It looks for pullbacks against the direction of the trend to buy and sell into the trend. Long Entry Conditions: - Short EMA above long EMA and price above short EMA - Pullback below short EMA - Entry on close above short EMA Short Entry Conditions: - Short EMA below long EMA and price below short EMA - Pullback above short EMA - Entry on close below short EMA
Education
by TradingPit
Simple Indicators and Setups #1: 200HMA on D1 Time ScaleThis is the beginning of what will probably only be a few posts about basic indicators/setups. Everything I chat about in these will be something that I personally use, something that is very simple to use, and something that is historically incredibly reliable. Something to keep in mind with TA is that there's a lot of garbage out there, and often times the more complex someone's TA is the more magical/fake it is. TA is never, ever, ever 100% accurate and wild cards come up that break the mold of even the most reliable setups, so keep that in mind if you decide to trade using these setups; previous results are not guarantees of future performance. Keep this in mind please and always watch out for yourself. 200 Period Hull Moving Average on the One Day Time Scale When it comes to reading price action, there are few indicators that are as useful as moving averages. The idea behind a moving average isn't to tell you where the price of an underlying has to be it's to help expose a baseline of where the market at large has been pricing an underlying over a set period of time. Moving averages provide us with price support and trend confirmation information by removing the noise of daily volatility and price swings to give a less chaotic view of price action over time. Of the different types of moving averages, my favorite is the Hull Moving Average (HMA). This is a very fast, smooth moving average that in many cases can eliminate the lag you find in Simple or Weighted Moving Averages. In fact, the HMA is kind of a sped up, bastardized Weighted Moving Average: HMA= WMA(2*WMA(n/2) − WMA(n)),sqrt(n)) One of the most reliable uses I've found for the HMA is to view underlying price in against the last 200 daily periods of price action. This is way more reliable on large to mega-cap companies but it does work reliable on the more "boomer-y" of the midcaps. In my opinion, the biggest thing that technical traders will have to look for are assets with the least potential for meme-ability and those assets are the best for this strategy IMO. So How do You Use This? I very, very, very rarely take bearish positions because for the large part stonks really do only go up for the most part. However, I've had the most success with this indicator as a bearish indicator. For me personally, this isn't an indication for me to take a bearish position necessarily, it's an indicator to deleverage and pull some money off the table until I can see what the next few days holds. So using SPX futures as an example, when the price of an underlying falls below the 200HMA on the D1 time scale, it is an incredibly reliable indication of either a downturn or a sustained period of volatility in markets. My backtesting on the assets I've used this on has shown it to be roughly 90% reliable over the past 5 years I looked back. That being said, just like with any TA, it's not reliable 100% of the time. You can see a recent (early Feb 2021) example showing an instance where price shot right back up followed by a sustained period of volatility in the markets (Mar 2021). When this occurs on larger market indexes, I do the following: Wind down on exposure to long, market reactive assets (ie: $AMD for a drop in NQ, etc) Open up long volatility plays such as $VIX or inverse ETFs Completely close 100% of my shorter dated long options plays (less than 2 months) When the daily price action falls below the 200HMA on the D1 candle, it's telling you that the underlying has approached a level of weakness that is extreme in comparison to its total performance over the past 200 days, which is no small thing. Generally, the market reacts with fear as prices weaken and sell-offs of varying degrees follow or at least rotations from sectors that increase overall volatility in the markets. The best TA is simple, it's easy to understand, and it's easy to connect with real-world motivations of how actual people behave and think. The 200HMA is a great example of this in my opinion, and is something grounded in reality that produces actual results instead of being yet another of the waterfall of fantastical garbage people like to throw out as TA.
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CME_MINI:ES1!Education
by SwingTradeAssassin
69
The trend is your friend!In this article, we will present some basic information about the bedrock of technical analysis – the trend. Technical research is founded on one main assumption: market prices move in trends as they are freely traded. Traders and investors hope to buy a security at a low price at the outset of an upward trend, ride the trend, and then sell the security at a better price when the trend stops. While this technique is straightforward, putting it into effect is incredibly difficult. Trends come in all shapes and sizes, from long-term patterns that last decades to short-term patterns that emerge minute by minute. All trends tend to have the same characteristics. Investors must choose which trend is most important for them based on their investment objectives, personal preference, and the time they are ready to spend watching market prices. Trends are obvious in hindsight, but ideally, we would like to spot a new trend right at its beginning, buy, spot its end and sell. However this ideal almost never happens, except by luck. What exactly is a trend? 1. An uptrend or upward trend occurs when prices reach higher highs and higher lows. 2. A downtrend or downward trend is the opposite: when prices reach lower lows and lower highs. 3. A sideways or flat trend occurs when prices trade in a range without significant upward or downward movement. From the investor/trader’s perspective, a trend is a directional movement of prices that remains in effect long enough to be identified and still be profitable. The most popular method amongst traders to identify a trend is looking at a graph of prices for extreme points, tops & bottoms and to draw lines between these extreme points. These lines are called trend lines . By drawing lines between tops and bottoms we get a „feeling” of the direction of price movement, rate of change of movement, and also its limits. When those limits are broken, they can warn us that the trend might be changing. Another method for the study of trends are the moving averages which smooth out and reduce the effect of smaller trends within longer trends. The number of trend lengths is unlimited. The ability for trends to act similarly over different periods is called fractal nature . When we say that the trends are fractal in nature we mean that in any period we look at we see trends with similar characteristics and patterns as each other. The trend length of interest is determined solely by the trader’s period of interest . This doesn’t mean that different trend lengths should be ignored. Because shorter trends make up longer trends, any analysis of a period must include analysis of longer and shorter trends around it. Trends are determined by supply and demand. As in all markets, whether apples, oil or used car components the economic principle of interaction between supply and demand determines prices in trading markets. Each buyer bids for a certain quantity at a certain price and each seller asks for a certain quantity at a certain price. When the buyer and seller agree and transact, they establish a price for that instant in time, whatever the reasons might be for the buyer wanting to buy and the seller wanting to sell. The technical analyst, therefore, watches the price movement and the rate of change of prices and doesn’t concern himself/herself with the reasons of the transactions because most times they are indeterminable. The number of players and the number of different reasons for their participation in supply and demand is close to infinite. Thus, for the technical analyst, it is futile to analyze the components of supply and demand except through the prices it creates. Furthermore, when someone invests or trades the price is what determines profit or loss, not corporate earnings or Federal Reserve policy. The bottom line is that the price is what determines success and fortunately, for whatever reason, prices tend to trend. . Trade with care. If you like our content, please feel free to support our page with a like, comment & subscribe for future educational ideas and trading setups.
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TVC:DXYEducation
by financialflagship
134
Bitcoin 57k-53k Sell BreakdownBitcoin 57k-53k Sell Breakdown In this video I go over my personal overview on the move BTC made from around 57125-53300. The video is broken down into 2 parts! First me showing my full markup of everything pieced together. The second half is a breakdown from scratch of how I put the pieces together. Market structure was a little bit shaky as the buyers are trying to hold control but the story is able to be identified from the 4HR TF and below. Especially on the 15min price action gave all the answers to the test to see the sell. Patience is key and always pays. I utilize the Fibonacci and Elliot Wave Sequences to provide a different perspective on the sell. Giving more confirmations to follow the price action. Market structure is King & Price Action is Queen . As always THANK YOU and if you found this video helpful, please let me know by hitting that like button and/or leaving me a comment below. Also, feel free to share your opinion on this setup or other setups that you have. The more ideas we can generate together, the more informative these ideas become for newer traders. STAY BLESSED! ~T$
BITSTAMP:BTCUSDEducation
by OkayTrev
Etherum 1780-1660 Sell BreakdownEtherum 1780-1660 Sell Breakdown In this video i go over my personal overview of the sell setup that Etherum made from 1780 down towards the 1660 area. From the 4HR TimeFrame price action was telling the story that lined up beautifully for the continuation towards the down side. From the lower time frames the buyers were attempting to hold the support levels but failed to continue the trend once it made its way above the 50EMA. I utilize the Fibonacci and Elliot Wave Sequences to provide a different perspective on the sell. Giving more confirmations to follow the price action. As always THANK YOU and if you found this video helpful, please let me know by hitting that like button and/or leaving me a comment below. Also, feel free to share your opinion on this setup or other setups that you have. The more ideas we can generate together, the more informative these ideas become for newer traders. STAY BLESSED! ~T$
Education
by OkayTrev
PB&J: Shadow-30PB&J: SHADOW-30 If you are new to trading, then start with this pattern! It is easy to identify, easy to learn, and easy to trade. What more could you ask for? HOW TO TRADE THE SHADOW-30 CHART PATTERN This can be an "everyday" pattern because of its reliability. It is easy to spot and simple to trade. THE SETUP The name Shadow-30 refers to a "shadow" that slices through the "30" period exponential moving average. This looks like a Hammer on the chart but it doesn't have to be perfect to be considered a Shadow-30. - The color of the real body is not important. - The shadow on the chart flushes other traders out of their position. Note: There is nothing special about the 30 period moving average. It is just a reference. Look to the left on the chart to determine support and resistance. When you are trading any kind of long lower shadow or Hammer pattern, always look for volume to be higher than the previous day . - This suggests that many traders were shaken out and demand is picking up. - This is important! THE ENTRY If you are able to trade during the day then buy on the day of the Hammer near the end of the day. You do not need any kind of "confirmation" or anything else. You only need to see that price is at a support level and that demand is coming (volume). That is all the confirmation you need. If you cannot trade during the day then place your buy stop above the high of this Hammer day. The next day you'll have to check to see if your order gets filled and then place your stop loss order. You could also use a bracket order. THE STOP LOSS ORDER There are two options for the placement of your stop loss order. Each has advantages and disadvantages. You decide what is right for you. Option 1: - Put your stop under the low of the Hammer. The advantage to this is that your stop is far away from your entry price and you will not likely get stopped out prematurely. The disadvantage to this is that because your stop is so far away, you will have to buy fewer shares in order to comply with your money management rules. Option 2: - Move down to the 1H chart and put your stop below the support area closer near the real body of the candle. The advantage to this is that you get to buy more shares because your stop is closer to your buy price. The disadvantage to this is that because your stop is so close, you may get stopped out more often, before a big move happens. TAKING PROFITS When you are trading wide range days like Hammers you will find out that many times the chart will trade sideways for a day or two. That is fine. You are already in the trade just waiting for other traders to enter. Also, the days that follow a Hammer are typically low volatility, narrow range days like Doji. Be patient! Do not get anxious to move your stop up. Wait for price to actually move in your favor before you begin trailing your stop. Once price moves in your favor, then you safely begin to trail your stop loss using your favorite exit strategy to lock in profits. TRADING TIPS Focus on those charts where the real body of the candle is close to the 30 EMA. You want as many traders as possible shaken out of this before you get in. This setup is reversed for short positions except now your are looking for charts with a Shooting Star pattern through a declining 30 EMA. Give more weight to setups where price gaps away from the previous candle to end the day in a Hammer. Always look to the left on the chart to make sure price is at a significant support or resistance area. WHEN GOOD CHART PATTERNS GO BAD Yes, you will have losing trades with this pattern. There is no pattern that will guarantee all winning trades! But with proper money, trade, and self management, you can do very well with this setup.
INDEX:BTCUSDEducation
by zerocashcool
New Technical Tools Back Tested on Old Extreme MarketsIntroduction If traders back in the day would have had the modern technical analysis tools they could have forecasted the market crashes more easily. Once the past is gone it's gone forever, but we can always go back to learn from it. Those who ignore the past are doomed to repeat it. In this publication I back tested a couple of tools which basically detect the trend direction, trend strength and momentum. Market at a Glance The charts should follow the K.I.S.S. principle, (Keep It Simple and Stupid), the simpler the better. An indicator should provide as much meaningful information as possible without being overwhelming and without pushing the limit to the analysis paralysis level. I use the classical Madrid Ribbon indicator to determine the Bias at a Glance. This indicator is very simple, and it only needs one parameter, exponential moving average or the default simple moving average, the rest is done by the script. At a glance I can get the bullish or bearish bias by just looking at the color of the indicator, green for bullish, red for bearish. The screams are all the same When the market sells, it sells, at first there is no way to know if this is a selloff or just a profit taking and an opportunity to buy the dip. By looking at the indicators, I can determine if the vector is in the red, then it's a selloff, and probably the start of a bear market, if the vector is showing weak momentum, or if it is in the brink of going in the opposite direction. A selloff is not always the same, and the indicator can help to determine the best strategy to follow. Going back to normal After a bear market, once the indicators show a weak momentum to the downside it is time to get ready to load and wait for the confirmation of the reversal to the bull side. In the following examples I back tested the Madrid Ribbon and the MAdrid Vector to get an idea of how the indicators reacted under an extreme condition, like that of the market crash in 1929, the Black Monday of 1987, the Dot Com bubble and I finally used it to glance at the present market. The Great Depression 1929 "The Roaring 20's" The feverish Stock Market. The time when everybody wanted to get in because everybody was making money. The Bull Market of 29 started in June 1924, when the Madrid Ribbon confirmed a Green Bull after a double bottom from November 1923 and May 1924. There was a reversal of the Bear trend in November 1921. The "Madrid Attack Vector'' indicator confirms the times of the duration of the trend. It shows a dull market in November 1922, a Peak and an exhaustion with a Bearish reversal. In May 1926 there was a painful correction, pinpointed by both the Vector and the Ribbon, a consolidation and a continuation of the Bullish market. In August 1928 the mass committed to the euphoric upward move for a juicy 60% return for the year. A correction and another leg of 30% which would make around 90% riding the trend with perfect timing. After this point the buying stopped. No more bidders, no more upside, smart investors and short term traders run for the exit. By lack of demand the ask price tumbled until it found bidders. This happened pretty fast but it is detectable. The initial drop was recovered (buy the dip) still in the bull territory, but there is a warning, the vector already displayed a divergence between the trend and the trend strength, it was weak and it is not a good sign, the trend had reached exhaustion and it's time to be extremely cautious. The correction made the index dipped -30%, after which point one wave of short sellers were covering their initial short positions, and some other dip buyers were stepping in. At this point, both Madrid Ribbon and Madrid Vector show the trend is already in bear territory, so this "back to normal" was only the start of the historic decline. It was not a free fall, it was a stepped fall with approximately -30% declines and recoveries of +20%, until the total market fall from peak to bottom reached -90%. The accounts were wiped off and the bankruptcies piled up. Both the Vector and the Ribbon show the "Sell the Peak'' points. Everything in the red means the Bear Market is going on, until the Vector shows a weakness in the selling and the Ribbon shows no new "Lower Lows" are made, this signals a Bullish Reversal. Black Monday 1987 Once the Madrid Ribbon signaled the trend reversal going from red to green, the Bull Market was pinpointed to start in July 1984, from that point the Market went up, it reached 100% return from bottom to top, it corrected about 10% and kept on going until it peaked at 2700 points. By 1987 the computers had taken over the stock market, when several bulls took profit at around the target level, this event triggered the circuit breakers and liquidated the positions, the Flash crash took a dive of 35% from top to bottom. The Madrid Vector detected the last low momentum and the Madrid Ribbon detected the double top, this signals a momentum divergence and a possible reversal. Note that during the time the Dow Jones reached 1940 points and it started to consolidate. At some point the Madrid Vector signaled a low momentum and trend divergence, which didn't finish the bull market since the market found support. The old saying says "never short a dull market", it applies here, the Madrid Vector remained signaling a Bull Market with low momentum, but never went to the Bearish side. Nobody becomes poor by taking profits anyway. The market went for two more cycles, from July 1986 until April 1987 and the grand finale from May 1987 to September 1987. The expansion from the Madrid Ribbon shows the level of euphoria in the market. The Market became too complacent and overconfident. That's the point where there's liquidity in the market to exit at a profit if the entry was well calculated. This bear market didn't last for too long, and once the Madrid Vector signaled a low bearish momentum the market was ready to resume the uptrend. The Dot Com Bubble This case was similar to the Black Monday, euphoric market, almost no momentum to the upside according to the vector, a failed double top and a reversal. The low momentum signaled at the end of the trend is a sign of a reversal. The Madrid Ribbon shows the closing prices are already under it and in the red, this is a Bear Market. There are short recoveries where the short sellers and the target pivots act as temporary support, which is shortly after broken. This Dot Com Bubble shows a sign of relief in 2002, but the Madrid vector shows the little momentum to the upside, and not enough to trigger a trend reversal. It is on the second weak momentum point where the price starts to find a floor, there are less sellers and the institutional money is positioning. The uptrend was ignited in April 2003 and the bull rally started. The end of this leg is signaled also by these two indicators. The Ribbon shows a bearish development, the trend tries to go back to normal, but at this time the Madrid Vector already shows a very deep red level, the recovery is the "Going back to normal" trap which is used to liquidate the positions and ride the Bear. Present Day 2021 2016 showed two big dips, one in August 2015, the second in January 2016, These were two big testing points, a double bottom that was used to see how firm the ground was before going long and strong in 2016. The red dips are shown in the Madrid Vector and the Madrid Ribbon. Once the trend picked up and the Market started to make new highs (HH) the euphoria picked up until January 2018 when a full expansion of the ribbons was suddenly stopped by a critical low momentum on the Vector, it is a divergence that signaled a reversal, the market tried to make a second top but the momentum was very weak and the market just consolidated. Later in September 2018 the market went for the double top on weak momentum, this is a very bearish sign that ended in "The Nightmare Before Christmas", plus the Santa Gift for those who traded on Christmas Eve and rode the late 2018 early 2019 Santa's Rally. A couple of dips with strong upward momentum on three waves and then COVID put a halt in the market. This is signaled by a weak bull momentum at the double top, again a bearish reversal. The only thing is this has been a huge reversal that practically wiped off the last four year rally. The market took the dip, the vector signaled a weak bear momentum and it is a sign of bullish reversal. The momentum was weak when the Madrid Ribbon was changing colors. This is the Support/Resistance fight, and the market could have taken another dive down to test its commitment, however the market decided to go in full force and the momentum started to timidly grow until what we see today. We have again a full bullish momentum, with an expanding Ribbon. So we're completely in the green and with an Euphoric market .... again.
Editors' picks
TVC:DJIEducation
by Madrid
97
A 100% profitable strategy on BitcoinHello guys, in the Daily chart of Bitcoin after last candle close, recently something bullish happened, short term 5 Moving average crossed long term 20 Moving average. MACD is also supporting the further upward movement in the daily chart. this is a bullish signal in an uptrend. this is one of my swing trading strategies in Bitcoin market. I'll go long with a low leverage margin, whenever this daily Moving average crossover happens. I'll close the position as soon as the opposite situation happens which is short term 5 daily MA crossing down the long term 20 daily MA. A useful tip to this strategy is to combine it with a oscillator indicator like MACD or STOCHASTIC to prevent the fake outs. For example do not go long if the STOCH is at overbought territory and do not go short if It is at oversold territory. Disclaimer** This strategy doesn't work in a range market condition. Only use it in trendy markets. You can go back in the chart and backtest this strategy, it is pretty great for swing trading. Please like and share this idea if you like it. Thanks for your attention
Education
by TiranTrading
3
How to import Quandl data into TradingViewQuandl is a data library with all sorts of useful macroeconomic data. Unfortunately a lot of it you have to pay for, but there are also many data series you can access for free, including the "Blockchain" library with lots of useful data such as Bitcoin transaction fees. To access Quandl data, go to quandl.com. In the left-hand column, check the "Free" box to ensure your search results include only free data sets. Then type what you're looking for in the text box (e.g. "US wages" or "Bitcoin transaction cost"). Click the name of a data set in the search results. You should now see a chart. On the right hand side of the chart, click the "TradingView" button to import to TradingView. For an example of how to use this data, watch the video or check out my previous idea on Bitcoin transaction fees as a predictor of Bitcoin's price:
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BEducation
by ChristopherCarrollSmith
42
Bollinger Bands - Contraception for your Price ActionSo i thought i’d do another educational post, this time on the Bollinger Bands. I’ll try and keep this as a brief introduction to the basics of Bollinger Bands so you can do your own research to fully understand what the indicator is doing and showing, there is no point putting a fancy indicator on your chart if you have no idea what it is showing you. Bollinger Bands measure, Price & Volatility, potential Support and Resistance, & it can also give you a sense of if an asset is Overbought or Oversold, although its best practice to use another indicator to get confirmation of being Oversold or Overbought because the price can walk the Upper and Lower Bands for extended Periods. The Standard Bollinger Bands is composed of a 20-period Simple Moving Average (SMA) which is its Middle Band, it also has an Upper Band & a Lower Band which envelopes the SMA. The outer bands are a +/- 2 Standard Deviation (StdDev) of the 20-period SMA in whatever timeframe you are in. A Simple Moving Average (SMA) is an unweighted average of the Previous 20-period Values in whatever timeframe you are in, so for the 1min chart, the SMA period will be an unweighted average of the previous 20 mins, for the 1hr chart, the SMA period will be an unweighted average of the previous 20 hours, for the Daily chart, the SMA period will be an unweighted average of the Previous 20 days and so on and so on. You are able to change the SMA to any period you want, some trading sites also allow you to change the SMA into an Exponential Moving Average (EMA). Changing the timeframe from the standard 20-period SMA to a faster SMA like a 10-period, will allow faster entry into possible buy & sell points but could be prone to false signals, because of this, most people keep the SMA at the Default of 20-periods to avoid possible false buy/sell signals. You can change the StdDev settings, but you must know what you are doing as you cannot just add any number for shits and giggles, for example, a 20-period SMA is 2 StdDev, a 10-period SMA is 1.5 StdDev and a 50-period SMA is 2.5 StdDev as default. For those interested, & from my understanding of it, the Population Standard Deviation used in the Bollinger Bands system is a measure of the +/- dispersion/variation of the mean or the sum of a collection of values, the values being the 20 periods, so a +/- deviation value away from its Midpoint Basis in whatever timeframe you are in. I won’t go into the calculations because everyone will stop reading & it’ll also hurt my head because i cannot even count. So the + is the Upper Band and the - is the Lower Band. So looking at the Bollinger Bands, we now know that the Middle Band is the basis & the Upper and Lower Bands are +/- Standard Deviations of that Middle Band Basis in whatever timeframe you are in. With Low Volatility, the closer the Upper and Lower Bands are to its Price & Middle Band Basis. The more volatile the Price action is in either direction, the further away the Price will move from its Middle Band and move closer to its Upper or Lower Bands depending on if it’s Bullish or Bearish. Along with the Price, the Upper and Lower Bands will also expand outwards and move away from its Middle Band. With extreme volatility the Price may even wick out or close a candle out of its Upper or Lower Bands. If there has been a period of Volatility which has come to an end, then you will see the Upper and Lower Bands start to contract inwards. You can use the Middle Band as potential Support and Resistance Levels depending on if the Price is above or below it. You can also use the Upper and Lower Bands as potential Resistance Levels, and also as potential entry levels for longs or shorts respectively. The Lower and Upper bands will point outwards and inwards depending on if the Price is contracting or expanding respectively. With normal volatility, if you use the default 20-period SMA & 2 StdDev settings, then the price action will possibly remain within the bands for roughly about 90% of the time. The Price will eventually move back in to the Upper or Lower Bands if there has been a period that the Price has been outside of the Upper or Lower Bands. What is great about the Bollinger Bands is that you can apply it to any chart and timeframe that has enough previous trading data, and use it to get a feel for the assets volatility over time. A key thing to look out for is the Bollinger Bands Squeeze, this happens when you buy latex contraception that’s too tigh……… sorry…… this happens when volatility has slowed & the Upper and Lower Bands contract, envelope and stay close to the Price & Middle Band so essentially Price action is trading sideways within a channel made up of the Lower and Upper Bands. The Bollinger Bands Squeeze Pattern can potentially end in a big breakout upwards or downwards. Bollinger Bands can also be used to see Bullish W-Bottoms or Bearish M-Top signals in the Price. These signals have 4 steps that need to happen for it to be considered valid but i’ll let you do your own research on that. The Price can also walk along the Upper and Lower Bands for an extended period of time depending on if the Price is Bullish or Bearish. It’s best practice to use complementary indicators like Volume, RSI, ADX, STOCH or MACD to try and get confirmation or any potential breakout. I actually use the Bollinger Bands on my charts in conjunction with the Ichimoku Cloud. On a side note, having a grasp of the basics of the original Bollinger Bands crated by John Bollinger is the first step to really understanding it and properly using it to enable you to make wise decisions with your money/investments. If you have an understand of the original Bollinger Bands, then that can help you with understanding other price enveloping indicators like what David ‘WycoffMode’ Ward has created. David has created his own genius take on the Bollinger Bands called Bad Ass Bollinger Bands, which is quite fascinating because it shows multiple +/- Standard Deviations for whatever timeframe you are in. You could potentially use these as multiple Support and Resistance Levels for whatever timeframe you are in and also look for any potential cascading effect from lower to higher timeframes using these multiple +/- StdDev levels, he does state however that to get the best out of it, you have to use it with his Phoenix Ascending indictor, which from what I’ve seen, i think it complements his Bad Ass Bollinger Bands by showing Momentum, Upwards and Downwards Pressure & potential Trend Crossover, this agrees with what i have said above, about using other complimentary indicators with your Bollinger Bands like RSI or MACD. From what I have seen of David’s Bad Ass Bollinger Bands, one of the many benefits of having multiple +/- Standard Deviations, 8 in total, 4+ & 4-, is that you end up with a closer to 95-99% of the Price action staying within the Bollinger Bands for more accuracy. 99% because if there is extreme volatility, that may still cause a Candle Wick to poke its head out. This new indicator is potentially a real game changer. This is just my opinion from what i have seen of it, so i could be completely wrong & David could say it doesn’t mean anything that i've typed and he’s gonna hunt me down for typing complete bollox. Below is a pic to show you the differences between the original Bollinger Bands and the Bad Ass Bollinger Bands. In any case, it’s best practice that when using your charts, you should have a range of indicators to complement each other, an indicator for Momentum, Volatility, Trend, Price, Volume ect. You do not need to add 4 indicators on your chart that show the same thing. If your using RSI then you don’t really need the STOCH, If you’re using MACD then you don’t really need ADX or Parabolic SAR. If you’re interested in learning more about the Ichimoku Cloud System, please click on the below pic which will take you to an educational post i did about it. I hope you have found this brief intro helpful & i hope it encourages you to do your own research to find the best trading strategy for you. Cheers 👍
BINANCE:ADAUSDEducation
by entertheroach
6