This article will show fairly effective methods for finding the winning deals and maximize profits. Even though in this article it may seem easy, the process of analyzing charts and direct trade still remains a difficult and painstaking work. Also, one should bear in mind that for better visibility, I chose the most prominent examples, which, of course, does not always occur in real markets.
The strength of trend lines
I am often asked what tools are best used when trading in the markets. I think that the best analytical tool is a straight line on the graph below the minimum bar to show the upward trend, and the maxima above the bars to show the descending trend. This tool is so simple that even does not need to use a computer. Nevertheless, given that traders still have computers, they are missing because of trend lines, and handle huge amounts of data through a complex formula to find the secret methodology that was never found. Forget it. I also did this and I know this firsthand. I continue to return to the simplicity of the manual construction of trend lines on the graph. When the graphical trend unfolding and breaks through the trend line, taken a new position.
Software package "Ensign Windows" is a very powerful and unique tool for "Auto Trends", which is illustrated in the chart above. Trend lines are shown and the program automatically in real time. The tool has proved effective and appreciated by many traders. Tool "Auto Trends" has several options that increase its value.
Warning trend line will show a window with a warning message in green, when the price breaks upward through the downward trend line and will show a window with a warning message in red when the price breaks below the ascending trend line.
The average trend is using the principle of parallel trends, and suggests a further trend, based on the average slope of previous trend lines. This feature is illustrated in the following chart.
The red trend lines are the average and the trend lines show a typical tilt, identified in earlier trends.
Lines channel and 50% s-line (mid-channel) can be added using the appropriate options for these options.
Option "Gann 1x1" will fit on the graph line of Hanna 1x1 key points of variation. Slope of the line 1x1 Hanna's own technology is used is determined by the square of the price and time.
The last two options for the tool "Auto Trends" can be used to show support and resistance and trend lines break, as shown in this graph.
The power of parallel lines
The first principle of analysis is that prices move in trends, but trends do not last forever. Ultimately, the price movement changes direction and breaks through the line of trend. The second principle, which I use, is that the trend lines are often parallel to each other. This means that there is a repeatable characteristic of the schedule in terms of the degree of price change. Similarly, a descending trend lines are often parallel to each other. I use this principle of parallel lines, which gives me ideas on how to be a typical bottom-up trend or down trend is typical when the price movement changes direction and begins a new trend.
Model "pennant"
Formation pennant indicates balancing the opposing market forces. Vympel is shrinking triangle, where prices do follow a lower maximum and higher minimum. Prices are usually from burst model "pennant" fairly quickly, often with the presence GEPa, plus a range of bars and increased volume. Come into the movement towards a breakthrough. A higher probability of break-up of a rising pennant, and downstream of the downstream pennants. Less frequent form of the pennant is a flag, where the price movement for a pause, and the price is moving sideways after a sharp movement. A higher chance of a breakthrough from the flag in the previous direction.
Fibonacci Price Levels
Fibonacci price levels are based, in horizontal lines on top and base of the recent trend. This band then further divided by horizontal lines on some parts of interest. I use most often three percentage of recovery - 38.2%, 50% and 61.8%. These percentages are members of the Fibonacci series of price levels. When used, the previous trend to predict subsequent values of a larger trend, I use the percentage of 161.8%.
Prices are often expanded or rebuilt to these Fibonacci price levels and then deployed. Confidence is growing, that trend has fulfilled itself when its slope is parallel to other trends, the number of bars in the trend corresponds to the Fibonacci and the reference price is about Fibonacci price level. Fibonacci price levels are built automatically in most graphics software simple task tops and bases of trend.
Another principle of horizontal lines is the fact that the previous resistance becomes future support, and previous support becomes resistance future. Always keep in mind the significant historical support and resistance levels, which are likely to remain relevant in the future, changing only its role in the opposite direction. Note in this example that point pennon joint on the horizontal line, I have identified as the base of the Fibonacci for the first 5 waves downward trend. In addition, this horizontal line was resistance to several peaks of the waves, which I marked '4 ".
Counting waves
The main forces acting on the market, forcing them to move means that form identifiable patterns or series of waves. Big trends are called impulse waves and each pulse is accompanied by a corrective wave. The theory, named after Ralph Elliott, says that will be 5 waves in the main trend, followed by 3 waves in the corrective movement.
I apply it fairly easy. I am looking for trends in 5 waves, and the correction of 3 waves. If I see a model, my confidence grows that the current price movement is due to turn. I also look at longer-term charts that take into account the direction of movement of the market a tool to better the picture. Deal with the trend and use the correction as an opportunity to join the main direction of the trend.
Calculation bars
Again and again I am amazed at the repetition of the number of bars in the trend. Account is often one of the following numbers: 3, 5, 8, 13, 21, 34 or 55. These numbers are members of a number of numbers called the Fibonacci sequence. Get the schedule and highlight any obvious trends. Consider the number of bars in each trend and the trend line, mark the number of bars. Each schedule will have the characteristics that will manifest itself. I allocate graphics that move up and down with regularity in the 5, 8 or 13 bar and then change direction. This approach can be used to know with greater accuracy, in which the bar formed the top or the base trend. In the example above, there are 8 bars in the trend of the point marked 4 to a point marked 5.
I hope that you made for yourself something useful from this article, which showed 6 simple and quite effective tool to analyze your schedules. Use these simple tools and stay on the right side of the market, trading in the trend.
The strength of trend linesI am often asked what tools are best used when trading in the markets. I think that the best analytical tool is a straight line on the graph below the minimum bar to show the upward trend, and the maxima above the bars to show the descending trend. This tool is so simple that even does not need to use a computer. Nevertheless, given that traders still have computers, they are missing because of trend lines, and handle huge amounts of data through a complex formula to find the secret methodology that was never found. Forget it. I also did this and I know this firsthand. I continue to return to the simplicity of the manual construction of trend lines on the graph. When the graphical trend unfolding and breaks through the trend line, taken a new position.
Software package "Ensign Windows" is a very powerful and unique tool for "Auto Trends", which is illustrated in the chart above. Trend lines are shown and the program automatically in real time. The tool has proved effective and appreciated by many traders. Tool "Auto Trends" has several options that increase its value.Warning trend line will show a window with a warning message in green, when the price breaks upward through the downward trend line and will show a window with a warning message in red when the price breaks below the ascending trend line.
The average trend is using the principle of parallel trends, and suggests a further trend, based on the average slope of previous trend lines. This feature is illustrated in the following chart.
The red trend lines are the average and the trend lines show a typical tilt, identified in earlier trends.Lines channel and 50% s-line (mid-channel) can be added using the appropriate options for these options.
Option "Gann 1x1" will fit on the graph line of Hanna 1x1 key points of variation. Slope of the line 1x1 Hanna's own technology is used is determined by the square of the price and time.
The last two options for the tool "Auto Trends" can be used to show support and resistance and trend lines break, as shown in this graph.
The power of parallel linesThe first principle of analysis is that prices move in trends, but trends do not last forever. Ultimately, the price movement changes direction and breaks through the line of trend. The second principle, which I use, is that the trend lines are often parallel to each other. This means that there is a repeatable characteristic of the schedule in terms of the degree of price change. Similarly, a descending trend lines are often parallel to each other. I use this principle of parallel lines, which gives me ideas on how to be a typical bottom-up trend or down trend is typical when the price movement changes direction and begins a new trend.
Model "pennant"Formation pennant indicates balancing the opposing market forces. Vympel is shrinking triangle, where prices do follow a lower maximum and higher minimum. Prices are usually from burst model "pennant" fairly quickly, often with the presence GEPa, plus a range of bars and increased volume. Come into the movement towards a breakthrough. A higher probability of break-up of a rising pennant, and downstream of the downstream pennants. Less frequent form of the pennant is a flag, where the price movement for a pause, and the price is moving sideways after a sharp movement. A higher chance of a breakthrough from the flag in the previous direction.
Fibonacci Price Levels
Fibonacci price levels are based, in horizontal lines on top and base of the recent trend. This band then further divided by horizontal lines on some parts of interest. I use most often three percentage of recovery - 38.2%, 50% and 61.8%. These percentages are members of the Fibonacci series of price levels. When used, the previous trend to predict subsequent values of a larger trend, I use the percentage of 161.8%.
Prices are often expanded or rebuilt to these Fibonacci price levels and then deployed. Confidence is growing, that trend has fulfilled itself when its slope is parallel to other trends, the number of bars in the trend corresponds to the Fibonacci and the reference price is about Fibonacci price level. Fibonacci price levels are built automatically in most graphics software simple task tops and bases of trend.
Another principle of horizontal lines is the fact that the previous resistance becomes future support, and previous support becomes resistance future. Always keep in mind the significant historical support and resistance levels, which are likely to remain relevant in the future, changing only its role in the opposite direction. Note in this example that point pennon joint on the horizontal line, I have identified as the base of the Fibonacci for the first 5 waves downward trend. In addition, this horizontal line was resistance to several peaks of the waves, which I marked '4 ".
Counting waves
The main forces acting on the market, forcing them to move means that form identifiable patterns or series of waves. Big trends are called impulse waves and each pulse is accompanied by a corrective wave. The theory, named after Ralph Elliott, says that will be 5 waves in the main trend, followed by 3 waves in the corrective movement.
I apply it fairly easy. I am looking for trends in 5 waves, and the correction of 3 waves. If I see a model, my confidence grows that the current price movement is due to turn. I also look at longer-term charts that take into account the direction of movement of the market a tool to better the picture. Deal with the trend and use the correction as an opportunity to join the main direction of the trend.
Calculation bars
Again and again I am amazed at the repetition of the number of bars in the trend. Account is often one of the following numbers: 3, 5, 8, 13, 21, 34 or 55. These numbers are members of a number of numbers called the Fibonacci sequence. Get the schedule and highlight any obvious trends. Consider the number of bars in each trend and the trend line, mark the number of bars. Each schedule will have the characteristics that will manifest itself. I allocate graphics that move up and down with regularity in the 5, 8 or 13 bar and then change direction. This approach can be used to know with greater accuracy, in which the bar formed the top or the base trend. In the example above, there are 8 bars in the trend of the point marked 4 to a point marked 5.
I hope that you made for yourself something useful from this article, which showed 6 simple and quite effective tool to analyze your schedules. Use these simple tools and stay on the right side of the market, trading in the trend.
Forex Magazine
on www.ensignsoftware.com materials
on www.ensignsoftware.com materials
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