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Oscillators

Correlation Coefficient + CCIPictured above is a graph of Royal Dutch Shell vs brent crude, the correlation coefficient between them, and the commodity channel index tracking the volume weighted moving average of Shell. I tested this indicator on a few energy stocks: RDS, MRO, BP and XOM. Negative correlation between brent crude and an energy stock coupled with an overbought CCI seems to give an indication of price reversal. Here we see two overbought CCI readings coupled with negative correlation, both followed by massive drops in the price of BCO and RDS. Likewise we see negative correlation coupled with upward CCI readings pointing to massive price rises in RDS. Seems to work on daily time frame as well but indicator length will need to be tweaked accordingly. Correlation coefficient going negative is an indication of pricing inefficiency and momentum potential, but does not give us an indication of price direction. The commodity channel index can give us a sense of where price momentum is pointed. Both put together give us a powerful indicator capable of foreshadowing both momentum and direction.
REducation
by Derivati_Capital
BTCUSD H4/D1 charts (2/15/2019)Good morning, traders. Price is attempting to push its way through the descending wedge's resistance as H4 RSI is pushing through its own resistance. H4 MACD is curled up and nearing a bullish cross above centerline. As we can see, the green target, which is based on the height of the wedge, is near the previous swing high. Traders need to be cautious as price nears that area. A close above that swing high is what is needed. A wick above but close below prints a bearish SFP which will likely have price reversing. However, a close above that swing high opens up the targets I discussed yesterday as price begins closing above the pattern resistances. While anything is possible at all times, there is little-to-no reason to think price is ultimately headed down from here at this time. At the very least, we should see price move up toward $3900. A daily close above $3615 should make this much more likely as that gets price back above the daily pivot. I am still not a big fan of the possible IHS but have left it for those of you who are interested in it. BTCUSD Shorts may be finding a temporary bottom at the very least. More importantly, they are nearing the area where they have previously bounced and price headed down as a result. Just because it has happened before does not mean it will continue to happen, though, but it is something to keep an eye on. If Shorts happen to drop below that level this time around it may be an indication that the market is reversing. Every day, we have a choice to act positively or negatively, so if you get a chance, do something decent for someone today which could be as simple as sharing a nice word with them. You just might change their day, or even their life. Remember, you can always click on the "share" button in the lower right hand of the screen, under the chart, and then click on "Make it mine" from the popup menu in order to get a live version of the chart that you can explore on your own.
BITSTAMP:BTCUSDEducation
by Chris_Inks
2
BTCUSD H1/D1 charts (2/12/2019)Good morning, traders. Price has continued within the flag and bounced off the 38.2% retracement on the D1 chart as I mentioned I was watching for yesterday. H1 is printing a short-term double bottom with a target of $3620, once price closes above the swing high of $3586 which would confirm it. H1 RSI is just under neutral at 47.3 and butting up against resistance, while H4 RSI has finally retreated to 52 as it bounced off the previous resistance area and is printing a descending broadening wedge, suggesting price may be readying itself to resume its upward momentum soon (as long as it holds). D1 RSI is holding bullishly around 52 while retesting resistance as support at this time as well. Price is sitting on the H4 21 EMA and just below the 21 EMA on the H1 while volume has been picking up in this area. This also puts price just below the daily pivot, so we need to see D1 price closing above that pivot to signal continued bullishness, though I really want to see price closing above the D1 TR's EQ of $3645. The more convincingly price can close above that level, the more bullish it becomes. However, if this level does not hold, I will be looking for the $3450/70 area to provide support. The pattern-based targets remain valid at this time. Ultimately, I am watching price within the pink descending broadening wedge. A move through the wedge's resistance provides a target above the flag's resistance which signals increasingly bullish likeliness if price can follow through beyond that target. That target happens to align with the D1 TR's EQ. However, a drop through the wedge's support signals, at the least, a test of the bottom of the local flag/EQ of the D1 descending channel. I see a lot of traders forcing entries right now. Don't. You should be waiting for price action to tell you which way to trade, not enter just to be in the market. The latter is the easiest way to lose money right after FOMO. BTCUSD longs and shorts are currently rising as a result. Volatility has also dropped off after the surge in action four days ago. Visible orders across the major spot exchanges and Bitmex show dominant demand right now which is a good sign if we can see an influx of buying. Every day, we have a choice to act positively or negatively, so if you get a chance, do something decent for someone today which could be as simple as sharing a nice word with them. You just might change their day, or even their life. Remember, you can always click on the "share" button in the lower right hand of the screen, under the chart, and then click on "Make it mine" from the popup menu in order to get a live version of the chart that you can explore on your own.
BITSTAMP:BTCUSDEducation
by Chris_Inks
1
13 tips for tradersI had this on my hard drive, I thought I would wipe the dust of it and write in in a clean manner in a post, helps me think more clearly. I need, and everyone can benefit from (new intermediate advanced legend even), having all of this in their mind: 1) Advice that trading is 95% psychology ===> Throw it in trash container Worse advice I have ever seen, or I totally missed something. Anyway, simple proof that this is all a load of feces: 5% of the population are psycopaths (not the murdering kind) so if this was that important they would all driving roll royce's. Also I am not a psycho (I think) and I do not have much issues with this... I guess not beeing dumb enough to go ALL IN *100 helps. Also... then, let's just let a bot do the trading. Making lists like this learning more everyday and always evaluating our own performance and track record, filter what does not work in certain market conditions... This matters 10000000 times more than "muh feeling :'(" 2) Look for ideas opposite to yours, especially beginners (less than 1000 hours trading/learning) Watching what others are doing helps, and when you have an idea looking for views opposite to yours really helps. Famous billionaires do this alot. Especially they surround themselves with people that view the world differently. Of course, do not waste time arguing with bagholders, and sadly alot of ideas opposite to yours you might find are trolls drawing arrows pointing up to unrealistic targets, it could even convince you that the "opposition" are clowns and there is no way you could be wrong, so do not fall for that trap. Just because someone is stupid does not mean they are always wrong. Consider bad TA as 50/50. 3) Noobs want a sure thing. Good luck with that one. 4) "It is impossible or super hard to make money you are competing against the best" ==> Trashcan advice... First, for lighting fast scalping they are using microwaves now... You are not going to win, sure. But not only is the competition really not that good (maybe I am a little biased here idk), but you do not even have to compete with them. Big money buys, just follow the momentum, ride on their backs. Forex is full of huge money (central banks, international companies buying a currency) they are not trying to rip traders off by hunting their stops, they actually need to exchange currencies, nothing more. Beeing arrogant and thinking every one is a dumb ape but you is probably a big plus :) All that matters are facts, "Is this pattern profitable?" "What is the winrate?" "What is the risk reward I get on average" "How long does the trade last?" "What are the fees?" "What are the odds of a massive selloff?". 5) "We dropped 90%, this HAS to be the bottom. How much further can we drop?" We can drop another 90%. And another 90%. And another 90%. And so on. I did not find any statistics but I am pretty sure that looking at ANYTHING that lost 90%, you would find that the vast majority of the time it was not "a huge opportunity" well it was, but not for buyers. Afaik some great traders made and make big money by shorting dead trash before it goes to zero. If a company is dead, how do shortsellers find buyers? Because to sell you need a buyer. Well, all the idiots that skipped math class and think "this is a great opportunity". Quit trying to fool me, I am insanely bad at maths, how can you drop 90% if you alreayd dropped 90%? How many more times can we drop 90%? * points and laughs with his redneck friends that only have 5 great-grandparents * x is a real positive number (R, +, .). y is an integer. x^1 > 0 since we have said that x is >0 and x^1 = x Now, consider x^y > 0. If that is the case, x^(y+1) >= 0 since x^(y+1) = x^y * x and the product of 2 positive number is positive. And if the result was 0 then it would mean than 1 of the 2 numbers was 0 (I think I don't need to prove this) so it will be > 0. There are plenty of stories of money managers that fell for "it CANNOT fall lower" and got destroyed. The internet is full of bagholders that get destroyed all the time with that insane logic. I do not even profit from this... Maybe I should rethink my whole strategy, when I see the sheer amount of bagholders with "buy the dip" mentality I could profit from...Might have been wasting my time this whole time when I could just short bagholder crypto's/stocks. Well maybe not crypto's as they are long sideways (complacency) lmao complacency @ -95% :D 6) "Soooo this means... y can be as high as we want it to, or in other words the number of times we can go down 90% before touching 0 is INFINITE." I do not know what the "record" is. I know that some companies have started at 10000$ and more and did not disappear even when their price was at 10 cents, that is a drop of 90% 5 times in a row. There are several examples, but 1 I see alot on social networks (lots of experts were recommanding to buy the dip "opportunity of a lifetime" when it dropped 90%) Of course it made 5 90% drops in a row looking at bottoms, but if we look at bounces from the tops after it bounced, it is obviously going to be more than 5. You just... cannot make this up.. And there are people defending it and claming they did the right thing when they "bought cheap" and are thinking of their yacht color etc. I cannot make this up. 7) Use excel. Have a process. This kind of stuff. Here is what I have for 1 of my strategies, I just wrote it down yesterday, helps me think more clearly and stop thinking about it: Pre-entry: Check previous occurrences on the chart, do some TA. Note where structures are. Entry: Entry is on the level or if we're past it a little after previous low. Target and stop loss: Initial target T1 is next structure, usually 1% for FX. Set stop loss to get a reward:risk of 2. Trade management: Close half at my target 1, stay until final target as long as the price stays above 0,382 to 0.5 fib. Here is an example of a winner I would have shorted following that strategy: Another one: 8) Money is made missing out. You make money when you miss out. Let me type this a second time: YOU MAKE MONEY WHEN YOU MISS OUT "You missed out" that sentence... wow. I do not know about others, but when I miss out a move, I like it, I am happy now, I really am. Because I know I am filtering all the bad trades. If even some good ones get caught, then I must be doing a good strict job right? Let's check the Bitcoin chart real quick. Here are a few moves I missed out: a- False break b- Buy the dip c- Big money is stepping in - Yes, people really thought a major bull market was starting. Easy to say how foolish that was in hindsight, but back then I was pretty lonely saying that was a bull trap. Even got banned from TV for calling it a bull trap. 9) Do you want to have a life? Or be exceptional at one thing? Having a life translates too: beeing basic sheeple that tries to mirror the people around him to avoid feeling different, does not have it in him to do whatever he wants but a slave to what others think of him/her, and has a boring depressing life he hates and should hate. Be a sheep or be a winner, your choice. 10) Day trading is bad, you can only make money bla bla bla. The only reason why daytrading is less profitable than say swing trading is spreads. I do not have the exact numbers here, but a broker analysed the millions of trades his clients took, and the majority of losers... Their losses equaled the fees... You aiming for an intraday 0.3% move and the spread is 0.02%? That is 6.6% of your profit. It can add up really fast. You need a large edge and alot of "margin" as in much more profit than losses to not get hit by fees. I was daytrading a couple of months ago, I filtered so much I had 3 trades a week. And all winners. 3. In a week. "More is better". There is NO WAY that someone making 10+ trades a day is only taking really awesome trades and not giving up alot of his profit to his broker, unless he is trading crypto on Gdax/Bitmex but crypto trading is dead now. I did it all, and it all works, from scalping for a few seconds to holding for 2-3 months. But you have to spend a little while writing down what you want to do, make sure the fees are small compared to the profit you realistically aim for. 11) Become a specialist. Find 1 strategy and spend all your time on that. Or find 1 market... but that one... Nah find 2 markets... What will you do when your market is sideways/dead? I have 1 single strategy, I am learning about other ones at the moment but I only really have one. 12) If you are new... go for a SIMPLE strategy, do not try to reinvent trading and be greedy. These are the strategies I am looking at: - My strategy is picking tops and bottoms where reversals happen (advanced, I would not recommend to most :p) - I am learning about hidden divergence (trend continuation) (intermediary difficulty) - I am interesting also in continuation inside bars when there is strong momentum (beginner friendly) Actually my strategy has to be one of the hardest there is. I use divergence as a filter + additional reason to go against the trend. I have become an amateur-expert at reversals. I know, this is terrible, every one says not to go for this, but it worked for me till now. I still can use ALOT more experience. Maybe one day I will call myself an expert. This strategy, if I am correct, is where greedy noobs get slaughtered. It is not easy, it is so dangerous. Sure you look at the chart and think "oh these divergences pop out, I could easilly buy here and sell here". Or "This was a clear bottom/reversal I could easily buy here". Nope. Sorry. You could not. What I started with was basic trendlines. I would look for anything bullish and buy when the trendline is touched, then sell when it goes ballistic, if it drops below the line I AM OUT. I was not very excited about making money when I started, but I really really did not want to lose any. I think this is the approach people should have (right?). Here is an example of a trade I took a year ago before I got bored and switched to another non recommended highly dangerous strategy :D 13) Trading is easy, but it takes time, and all these other qualities you have heard about. Take something simple: Support and resistance. Pretty basic. Just horizontal lines. Well, I think I am someone smart, I am a very fast learner, and I do not exagerate when I say I spent THOUSANDS of hours analysing support and resistance. Plus at least several hundred looking at RSI divergence alone. Plus hundreds looking at market life/cycles. Plus hundreds looking at different market conditions. Plus hundreds looking at moving averages. In total I am at 5k in a year. To become an engineer, you will need 5 years (is this the same in all countries? Can't be much different). You get 200 class days a year, 8 hours a day + 1 for homework (well maybe some people need more idk OR skip all lessons skip homework and rush rush before exams works too I guess) so that's 1800 hours a year or 9000 total. Of course you learn alot of useless stuff, but when you start working you have to learn your new craft anyway. Would you let an 18 yo surgeon on his year 1 operate on you? Would you expect him to reinvent surgery? Yes actually, but not in the good way :D Now trading does not require 10 years of studies (hey especially if you full specialize on 1 thing and 1 thing only), but I think you will need a couple thousand years under your belt to really know what you are doing. If you are lucky and have the qualities of a good trader in you as you start, and go for that 1 simple strategy and nothing else and respect all the rules (easy as you already have all the qualities) you could start making money pretty quick but not too quick (you have all of the qualities = you don't risk too much when you don't know what you are doing), you might get hit when a bull market turns to bear, but you will not get hit hard as you have all the qualities a trader needs. Otherwise, it will take time (or beginner luck), and in both cases before being really good you will need a couple thousands hours under your belt. So, the best advice you could get: if you do not like this, forget about it. Do not force yourself. The power of greed is not going to turn you into a millionaire even if you really really want to. It will turn you into a hobo thought, for sure.
Education
by MrRenev
What are the most used indicators? For someone that wishes to get an edge using technical indicators, which ones would be some of the best ones to have into your arsenal? To answer that question I will look at which ones are the most popular, I am only looking at oscillators here, overlays are not used that much (not talking about moving averages). First of all I tried looking at what hedge funds were using but that info is quite hard to get, but from what little I have seen I will guess it is going to be close to what you would expect. I check several sites and youtubes to see what THEY used. But most importantly, I looked at trading view ideas, luckilly I was tired and lazy so I just checked hundreds of ideas manually and noted what they used. Also, remember alot of people do not used oscillators (or overlays) at all. I myself have strategies based on naked chart. Actually I will probably make a script that hunts for daily inside bars (maybe fakey patterns) and I will publish that on TV. What I found on other sites is quite similar to my results on trading view. Here they are: I checked the top 180 FOREX ideas this friday and I found: 17 Stoch (%D) 40 RSI 22 MACD 14 Other (1 to 3 each) ==> Stoch = 18%, RSI = 43%, MACD = 24% Top 11 pages for Futures (18*11 = 198 ideas): 10 Stoch 35 RSI 23 MACD 18 Other ==> Stoch = 12%, RSI = 41%, MACD = 27% Top 6 pages for stocks 15 Stoch 36 RSI 30 MACD 40 Other ==> Stoch = 12%, RSI = 30%, MACD = 25% I do not really like stoch that much, but I can vouch for MACD and RSI. I got a strategy based on RSI (+ other factors of course) and another one with macd. They are both pretty decent. You can use any oscillators you want, but any strategy that uses oscilators I believe should have RSI or MACD included. There is a reason they are popular, and if you trade a divergence or whatever and every one sees it too, you really have the odds on your side. Stoch is quite popular, but I do not know what to make of it. The way it works... idk. You could make a condition "I will only enter long when stoch is below 20" but I looked at this, you give up winners and still pick up losers, does not look amazing. My recommendation would be: - Do not use 500 indicators. What is wrong with you? XD This is not how trading works. - Use MACD or RSI. - You can throw in a second one of your liking. I also found out the oscillator I use had a 0.6% occurence. Feelsbadman.
Education
by MrRenev
5
How To Trade Histogram IndicatorsHistograms such as MACD histogram or my Ichimoku histogram give two kind of trading signals. One is common and is triggered on each price bar. The other happens less often but is extremely powerful. The common signal is triggered by the slope of the histogram. When the most recent bar is greater than the one before, the slope is bullish. This is saying that bulls have the situation in control and that it is time to buy. When the more recent bar is lower than the one before, the slope is bearish. This shows that bears have control and that it is time to sell. When price action is going in a direction but the histogram in another, it tells us that the trend is losing its strength. Rule #1 Buy or go long when the histogram stops falling and rise a little. Use a protection stop under last support. Rule #2 Sell or go short when the histogram stops rising and falls a little. Use a protection stop above last minor resistance. In lower timeframes, it is not be worth to buy and sell every time the histogram reverses. A change of direction of the histogram incline is much more significant on higher timeframes such as Daily or Weekly. Rule #3 Bearish divergence: Sell or go short when the histogram is reversing from its second lower high and price is on a new high. Place a protection stop above the new high. Rule #4 Bullish divergence: Buy or go long when the histogram is starting to reverse from its second higher low and price is on a new bottom. Place a protection stop under the new low.
Education
by cyatophilum
Use your own eyes & experience over oscillators. My bread and butter is RSI and MACD divergence, I cannot look at 15 charts or more at the same time so I use alerts with those. But I know to trust my own judgement over what some indicator tells me. In these examples, and I could show countless more, what eyes tell us is what is right, not what the oscillators tell us. Yes, I know, I am comparing 2 different assets. Does not matter it works the same. Gigantic candle? You are not going to beat it all by yourself (well maybe in crypto you will if you are a whale that enjoys manipulating the price but why risk your money?). Wait for others to start buying/selling before you go in the same direction. "Experts" all say you win by going agaisnt the herd. Well they are all wrong, and stupid. The price moves in the direction of the majority, ALWAYS. Or to be more precise, where the most money is. 10 billion dollar buying and 1 billions dollar selling? The sellers won't win because they "go against the herd", 10 > 1 hence buyers are stronger ==> We go up!!!! Join the herd, simply be smarter. "Panic sell" before they do, wait for the front line to go in early and join after the battle started and the ones no one will remember died. They did the heavy lifting for you, all you have to do is wave your sword around, cut into pieces bruised tired solders, and get out before reinforcements arrive. You will be remember as the hero savior that destroyed them all 1 to 10, outnumbered! (Kinda like what the USA did when they "freed" europe, after the soviet union got 20 million casualties to destroy the bulk of the NAZI army - No I do not hate the USA lol I'm just saying) For GBPJPY: No divergence, but the sellers clearly showed up, and we went back up with less strengh I can see it with my own eyes. What the oscillators say does nto matter. They are simply here to help us. And for that Bitcoin example :) Also, Bitcoin went up and made a lower high with hidden divergence on both macd and RSI 1 hour chart. In this case, it can be used as further confirmation of "yep, sellers are back in force we going doooown!" I swear I picked examples at random not the "perfect ones". FOMO in and PANIC SELL quickly and you will be rewarded immensly. But FOMO while TAKING YOUR TIME. If you want to buy, wait for OTHER BUYERS to show up MASSIVELY before you join them. That all comes with experience. So if you are not there yet learn to play and git gud. NO ONE makes money by going in too early. EVER.
BITFINEX:BTCUSDEducation
by MrRenev
2
Making 112%+ Divergence Trading Bitcoin Long TermToday we have a fun one because I love making money. There is nothing better than nailing down an awesome trade and today I am going to teach you about something called 'divergence'. It might seem a bit complicated at first but it will be well worth it. As you can see in the BITFINEX:BTCUSD chart above, the prediction is stupid accurate. The Basics You are going to notice that I have a few lines drawn on the chart above and they tell you buy/sell scenarios. The return you would have had by simply following this would be INSANE! So I want you to keep an eye on it in the future. Here is what you need to know: (Disclaimer: Trading is never perfect. I am not saying there are not scenarios that are exceptions to the rules I am about to talk about. What I am saying is this stuff is gold and will make you money...so pay attention) So divergence can be done with any indicator but today I am using the RSI. Bullish Divergence (aka when to Buy): When the price created a lower low but the RSI creates a higher high - So you can see at all the 'buy' points the price of COINBASE:BTCUSD is making a lower low but the RSI indicator is making a higher high. Bearish Divergence (aka when to SELL): When the price created a higher high but the RSI creates a lower low - So you can see at all the 'sell" points the price of COINBASE:BTCUSD is making a higher high but the RSI indicators is making a lower low. Right now COINBASE:BTCUSD looks good based on divergence! It is moving in that positive direction and the price and RSI are both making higher highs. I will keep you updated on this thread for new developments. Oh yeah, before I forget...this can be used on short time frames! Be smart with it but it can be SUPER powerful. Let me know if you have any questions or need any help. Cheers!
BITFINEX:BTCUSDEducation
by UnknownUnicorn1542001
5
LTCUSD- Trading The Stoch RSIHi all, I would like to present to you an educational piece regarding a particular trading methodology. This involves using the Stoch RSI indicator as your primary utility. This trading strategy is only as good as your money management strategies are. Everyone employees different money management strategies, so how you approach this is up to you. This can be used for any coin/stock, so long as you set stop losses that you are comfortable with. This trading style requires you to be fairly liquid, and it's akin to a fast pace version of swing trading, depending on the time frame. This trading style works best on the smaller time frames (5m, 15m, 30m, etc.), and it's advised you set proper stop losses every time. The trading strategy is quite self-explanatory- when the Stoch RSI enters the oversold territory, you get ready to open a long. When it enters overbought territory, you exit the trade or open a short. The reason this trading style may be seen as favorable is because it allows you to circumvent extreme volatility, therefore minimizing extreme downside. Remember, the best traders are okay with losing trades, so long as they win on average. By employing this trading strategy, you are less concerned with the current price of the coin, or where it may be headed over the course of the next few days/weeks/months. What you are ultimately interested in is riding a 1-3% rally up, then promptly exiting. The beauty of this trading strategy is that you can find a multitude of coins that will go through this process, and if you get a good rhythm going, you can constantly find trades to set up and win. You must accept the fact that you won't win every trade you enter, and you must accept that you WILL lose money, but as long as you have a consistent strategy to follow that works, you will succeed. Just be aware that this particular strategy requires a level of attention similar to that of scalping. You can of course do this on larger time frames, but you will obviously be trading far less waves. In the example I've charted, for example, if someone traded all those intervals successfully, they'd have earned 45% over 9 days, which is obviously a great gain. No one is able to actually trade that accurately, but it's clear that the potential is there. Remember, successful trading is just as much a complementary positive psychology as it is anything else. If you get yourself into a winner's mindset, you will begin to win far more. Happy trading!
COINBASE:LTCUSDEducation
by NickPadovani
3] How to use Traders Dynamic Index and Complementary OverlayXtremePhaser = Thin Cyan line HighPhaser = Thin Blue line HighMBL = Thin Orange line Phaser = Thick Blue line Midline = Thick Black line & others. Just like the traditional use of moving averages, HighPhaser and XtremePhaser allows for higher time frame trend (by their nearness and crossover) to be seen and recognized by traders allowing them to respect market's condition to not imply what is not true and in the end 'lose it all'. It (TDI-CO) allows of course to show support and resistance. It also allows for support/resistance breakout to be evidenced as seen in 15 min chart with price being squeezed by Phaser (&Midline) and XtremePhaser. How to to trade retracements: Retracements come with the expectation of a trend continuation, therefore the safest trade is to continue trend not countertrend-trading with the pullback. Component lines aid in recognizing when the market is in a pullback as seen in image. HighMBL overlay did not allow price to rise any higher. Phaser and HigherMBL formed a channel because of their slope downward, but the importance of their steepness is major, as it should determine how you should trade. In summary you should trade in same steepened direction as the thick blue and thin orange line, but a breakout of a flat highLine is more promising for the adept swing traders.
Education
by YardleyRosette