Educational tutorials (Written)

link to formations tutorial:

http://theengineeringtrader2.blogspot.co.za/2017/05/formations-tutorial.html

EXAMPLE

The Inverse Head and Shoulders pattern follows the same pattern as the regular Head and Shoulders, with a left shoulder, head, and a right shoulder but is flipped about the neckline which can be seen in the diagram below. The Inverse Head and Shoulders is thus a bullish formation

link to formations tutorial:

http://theengineeringtrader2.blogspot.co.za/2017/05/candle-stick-formations.html

EXAMPLE

Candle sticks are a powerful tool used in charting and technical analysis. They deconstruct the share price data by displaying four different sets of data in one “candle”. The candle can be seen below. The four sets of data displayed are: high, low, open, and close. Candle sticks can cover different time periods - daily, weekly, monthly, etc - as long as the consistency of representation is the same. The placement of each can be seen in the pictures below. The green candle is termed a bullish candle and the red candle is termed a bearish candle.

link to Stochastic indicator tutorial:

http://theengineeringtrader2.blogspot.co.za/2017/05/stochastic-indicator-tutorial.html

EXAMPLE

This technical indicator measures a shares momentum. What momentum means is, what is the share price doing, in relation to past data. This is one of the most popular indicators that traders make use of, and can be highly effective if used in the right way. The indicators output can be seen below.

The stochastic oscillator its self is bound between 0 and 100 and moves within this range. In the picture above one can see two horizontal lines one red and one blue. These indicate the overbought and oversold regions. They are placed at the 20 and 80 mark on the vertical axis. When the stochastic oscillator moves below the blue line at 20 on the vertical axis a potential buying region is indicated to the investor as the share is becoming oversold. Likewise when the stochastic oscillator moves above the red line at 80 on the vertical axis, this indicates to a potential investor that the share is becoming overbought and this is not a good opportunity to enter into the trade.

The first technique that will be discussed is the application of the moving average to the stochastic to find potential trade entries and exits. In essence the moving average provides a smoothed version of the stochastic data as it takes the average of several values and uses that to create points which form the moving average version of the stochastic. The chart below makes use of a slow stochastic with a 7 day moving average applied. The different types of stochastics will be discussed in the latter of this page

link to MACD and Ratios tutorial:

https://theengineeringtrader2.blogspot.co.za/2016/06/macd-and-into-to-ratio-analysis.html

MACD stands for moving average convergence divergence. This is a momentum indicator that track trends and is one of the most widely used and trusted. The standard MACD settings are 12-26-9 meaning, a fast exponential moving average of 12, a slow exponential moving average of 26 and a signal simple moving average of 9. The MACD makes use of two moving averages where it subtracts the longer period moving average from the shorter period moving average. The MACD moves above and below the zero line as shown in the example below. Unlike the Stochastic indicator, this indicator is not bounded, thus it does not signal overbought and/or oversold conditions. The blue line shown below is the MACD line which makes use of a 12 day exponential moving average, given standard MACD settings. The red line shown below is the signal line and makes use of a 9 day moving average. The green bars shown is the MACD histogram. The MACD is a very powerful indicator due to the fact that copious amounts of information can be read from this one indicator.

The crossover method is the most common method use for the MACD. It applies similar principles that create and operate moving averages and stochastic moving averages. Using the example shown below, this principle will be explained. The crossover method indicates.....