An Introduction to Technical Analysis of Stock Charts

[tech/a]

Re: An Introduction to Technical analysis of Stock Charts.

Yes it appears my Altzhimers has kicked in.

Its really played Havoc with my HINDSITE analysis.

 

[ozambersand]

Just bumping this so I can find it again more easily. So much to digest, can't do it in one sitting!
Thanks for all the info and work that is in the thread too Tech/A

 

[lvt]

Hi,

I am brand new to the forum, have not looked around much but will.

I have question on Steidlmayer. More specific the construction of the VAD.

Can you help? I urgently need to understand this.

Thank you,
Leon

Hi.
Technical analyisis is the study of price action.
There are many ways to study price action here are a few.

Bar charts,Candlesticks, Point and Figure,Steidelmayer,Renko,Kangi.
Oscillators(RSI,Williams,Stochastic,MACD etc),Indicators,Fibonacci,Time and Price analysis (Gann--Elliot)
Pattern recognition (Triangles,Flags,ledges,Rectangles(Including Darvas),Head and shoulders,diamonds,broadening tops and bottoms(Go on a diet!!)wedges and then simply the bars themselves(Open,High,Low,Close,Volume).

Initially Ill limit discussion and examples to the more common.
Indicators Oscillators and Bar Charts,pattern recognition and Bar analysis.
This will take sometime to work through and Ill be away again in early June till mid June.Ill also endeavour to give chart examples when explaining something.
The old picture says 1000 words.

Firstly Id like to have everyone understand the most common mistakes that occure using technical analysis.
(1) Incorrect use of an indicator---lack of understanding as to what it does.
(2) Using indicators and oscillators in the wrong context.The most common being looking for buy opportunities in a falling stock using OVERSOLD from an oscillator.(Oscillators are to be used WITH the prevailing trend---the only exception being Divergence with oscillator and price,Type A,B.or C).
(3) A signal from an oscillator means NOW----simply any oscillators signal means AROUND now unless proven otherwise.Think of it as a CIRCLE around a price area and not a DOT.
(4) Ocsillators and indicators are made up of PAST data and as such cannot be predictive.
(5) Signals remain valid for an infinite time.(There is a time when a signal is clearly wrong--- you must know when and take action).
(6) Analysis should start from monthly or weekly and move toward daily and then intraday.
(7) Over use of analysis.Many try to find Something,anything to justify their position---
(8)Price action DOESNT LIE.

For the purposes of education though I will start with Price bars and move out from there.
So things run smoothly Ill complete a topic and charts and post all at once this could take a while as time is scarce.My apologies.
Looking forward to discussion if there is anything specific please let me know and Ill answer it as we get to the relevant topic.You can private mail me if you wish.

TOPIC (1)
PRICE BARS---interpretation--reversals---gaps---volume

So if there are any specific questions to Price bars then lets hear them!
Im sure there will be some after the Price Bar module topic is posted.

 

[tech/a]

leon.

How to actually plot the VAD?

Its all by hand
using 15 min bars--generally.
Very quickly
Each price bar is plotted starting with A (TPO's)
If there is already a plot at that price you place the plot to the right of it.
As time goes by a profile of the days trading developes.
The VAD
is the region where 70% of the days trading was facilitated.
This Zone then becomes the area from which breakouts or retracements are likely to originate from or fall back to.

 

[Timmy]

I have question on Steidlmayer. More specific the construction of the VAD.

What's a VAD and how urgent is it that you understand it?

 

[pennywise75]

Re: An Introduction to Technical analysis of Stock Charts.

I have a free method which returns around 150% a year and I only know of 18 people who use it all with similar results to my own.

But traders (God Bless em) just love to re invent the wheel!!

There is NO magic bullet----all patterns/indicators/and methods fail its what you do when they do and what you do when they dont thats important.

(Rule (1)Now what you and many others here need to do is find out "WHAT IT IS YOU HAVE TO DO")

In the coming months I will go through "What" you need to develope a startagy---infact there is enough here to develope a simple short term trading methodology even now.---But thats beyond this thread.In time I think we should devise and trade a few.The Good The Bad and the down right Ugly---so we can see success and what to do when we have failure!

If you or anyone else likes an idea here I suggest you make a note of it under "Entry or Exit" technique and have a play "ON PAPER" with a few ideas.

I only trade with price action-----1 Moving Average and thats it!
150% for the last 3 yrs!

If I can do it EVERYONE CAN!
Read Rule (1)
In time everyone will be able to answer Rule (1)
My FCN thread may be of interest.

Tech/a thanks for the great post
What happened to this thread?

I am new to the forum and have spent much of my weekend reading through past threads... think i need a lay down due to brain overload.

I was really looking forward to hearing about MA's.

Did you follow this up in another thread?

keep up the good work

 

[tech/a]

Too long ago.

There is much over the years in various threads.
Just doing a bit on VSA (Volume spread Analsysi). In the Pullbacks thread (beginners forum)

 

[fiftyeight]

Love this thread.

Not sure how many times I have read it now