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Downtrend – How to Identify One

A downtrend consists of decreasing prices with observable lower price peaks and troughs. For prices to downtrend, bearish sentiment must overpower bullish sentiment. Therefore, supply is greater than demand.  A price trough is the lowest price level traded at...
Fibonacci Retracement Percentages

Fibonacci Retracement Percentages

Fibonacci Retracement Percentages Leonardo Fibonacci founded Fibonacci numbers and the Fibonacci sequence. They are numbers that are found to exist as part of a sequence that occurs in nature. Traders tend to open and close positions at these retracement percentages,...

Keltner Channels – How to Use/Why to Use

Chapter 3: Keltner Channels Keltner Channels were originally conceived by Chester Ketlner in the 1960s; however, Linda Raschke, a successful trader, updated and reintroduced this technical indicator in the 1980s. The most common formula is predicated on Average True...

The Alligator Indicator – How to Use

The Alligator indicator was popularized by Bill Williams in 1995. The Alligator indicator operates under the premise that markets, stocks, and other securities trend 15% to 30% of the time, and trade in sideways ranges the other 70% to 85% of the time. The Alligator...

DEMA (Double EMA) – How to Use

The Double Exponential Moving Average (DEMA) was originally constructed by Patrick Mulloy. DEMA was introduced as an indicator that abbreviates the amount of lag time encompassing traditional moving averages. Two exponential moving averages are incorporated in this...

STARC Bands – How and Why to Use Them

The Stoller average range channels (STARC bands) were originally conceived by Manning Stoller. STARC Bands incorporate two bands that are applied over and under a simple moving average of the underlying stock’s price. Starc bands are calculated by adding/subtracting...

How to Use the Demand Index (DI)

Demand Index (DI) is a volume indicator conceived in the 1970s by James Sibbet. It is used as a leading indicator to predict short to long-term price moves. The demand index computes two values, Buying Pressure (BP) and Selling Pressure (SP), and a ratio of the two is...

Technical Analysis Basics – For Beginners

Introduction Technical analysis was introduced by Charles Dow in the late 1800s and is a methodology for determining the future direction of a stock’s price by studying past market data. It uses patterns in market data to identify trends and make predictions....