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Heikin Ashi

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Heikin Ashi The three most traders use charts are candle stick, line chart and bar chart. Heikin Ashi comes next to these charts. Normal candle- In normal candle stick the next candle stick is not related to previous candle stick. The same day upper and lower price is shown.   In heikin ashi it’s a different case here each candle stick is calculated and plotted using some information from previous candle stick. We can read these candle sticks by using size, color, direction of candle sticks which can be adjusted using time frames ( 5 minutes, 15minutes,hourly and daily are most used time frames).Heikin Ashi candle stick is nothing but average bar which shows the new direction and strength of the trend which can help in forecast future trend. Steps involved for bullish trend- 1. First find the trend using heikin ashi 2. Secondly find the proper support area if you want to buy in     up trend. 3. The first bullish candle should have higher upper shadow...
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RSI Indicator - Relative Strength Index

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Indicators The Indicators are something which indicate what is happening in the market.Indicators help in analyzing the chart. One among the popular indicator is RSI indicator –   Relative strength index It compares the gain between recent gains and recent loses indicating over brought and over sold indications. It also measure the speed and change of price. The faster the market price speeder the RSI indicator and slower the market price the slower the RSI indicator The range in RSI is from 0 to 100 If the line reaches 70 then its overbought condition and there is probability that the market can reverse. If the line reaches 30 then it’s oversold and there is probability that the market can reverse. Note- Sometimes even when it reaches 70 (over brought condition) the price keeps going on. If RSI is combined with various indicators it can give more accurate results. Calculation The formula for RSI = 100-100/(1+RS) RS= Average profit/Average loss. Note - for s...
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MACD Indicator

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Indicator- Indicators are used to indicate something happening in the market. The most commonly used indicator is the MACD  indicator.  MACD Indicator- Moving average  convergence and divergence indicator   Moving Average – the moving average for any given number of time periods is the sum of the stock’s closing prices that is number of time periods divided by that same number For e.g.   a 15 day moving average is the sum of closing prices of past 15 days divided by 15. There are 2 line one is signal line (indicated by blue color) MACD line (indicated by red color) and a MACD histogram. MACD line – this line reacts faster on the indicator compare to signal line Signal line –this line reacts slower when compared to macd line BULLISH moment It   occurs when the MACD line is above the zero line in this the fast line is above slow line which is positive. BEARISH moment It  occurs when the MACD line is below the zero line in this the fast line ...
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Candle Patterns

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Candle patterns  So coming to the basic topic of what we see in the chart are the patterns. The patterns might be line, candle and so on. Here we will be discussing about candle patterns. As in line chart we can see only the end price of the day but in candle patter we can see closing price, opening price, and highest and low price for the day.  The basic 2 types of candles are explained below   1.Bullish candle-        If the price goes up on a particular time period then its bullish candle which is indicated in green color by default. Here as we can see in the figure the middle most part is the body of the candle and the top of the body is where the closing price is shown and bottom of the candle body is opening price is shown. The line above and below the candle are called wick also called as shadow where top line indicated highest price of the day and bottom most part of wick indicates lowest price of the day. Note : For example - if the ...
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Types of trading

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Here is a guide for you from basics of stock market.So in stock market there are companies with shares, broker and a trader.   There are 4 different types of trading depending on the time frame of investments they are as below.  1. Scalping 2. Day trading 3. Swing trading 4. Position trading 1. Scalping- Buying  a trade and selling it within a short term period around 10 to 15 minutes to gain 2 to 3% gain   is called scalping .A pure scalper should avoid over trading and should stick to the plan and  it demands high level concentration and time. As the saying goes         “if you want to sustainably make more and more money in the market using stock market you will have to learn how to manage your temperament”. Advantage- 1. Low Risk 2. You can make profit even if the market is slow or stagnant. 3. Gain profit from small capital as it as it will make small regular profit. Disadvantage- 1. Need high level concentra...
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