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    Stocks - r/Stocks Technicals Tuesday - Dec 25, 2018

    December 25, 2018

    Stocks - r/Stocks Technicals Tuesday - Dec 25, 2018

    r/Stocks Technicals Tuesday - Dec 25, 2018

    Posted: 25 Dec 2018 09:06 AM PST

    Feel free to talk about technical analysis here (not argue against it), but before you ask any question make sure you see the following information:

    Technical analysis (TA) uses historical price movements, real time data, indicators based on math and/or statistics, and charts; all of which help measure the trajectory of a security. TA can also be used to interpret the actions of other market participants and predict their actions:

    Measure: Is the security's price trending, has it dipped or is it a falling knife? Interpret: Does the current price mean investors think it's undervalued or overvalued; when did they buy/sell more and why? Predict: If price reaches a certain point, will there be a rally or get rejected?

    The main benefit to TA is that everything shows up in the price (commonly known as priced in): All news, investor sentiment, and changes to fundamentals are reflected in a security's price.

    TA is best used for short term trading, but can also be used for long term.

    Intro to technical analysis by Stockcharts chartschool and their article on candlesticks

    Terminology

    • Indicator - a calculation based on price and/or volume, it can be displayed as a line/number on a chart or watch list; some indicators use statistics like standard deviation such as the Bollinger Bands indicator
    • trade signals - when an indicator tells you that a buy or sell (short) entry is available (also called buy signal or sell signal)
    • lagging indicator - based on past prices, for example the Moving Average indicator
    • leading indicator - typically oscillators which fluctuate from 0 to 100 and back, and these typically measure the rate of change; they also generate overbought, oversold, and divergence, all of which help create trade signals
    • oversold - a trade signal for when to buy, for example RSI below 30, however it's best to wait when the RSI line points upwards past 30 before buying
    • overbought - the opposite of oversold; for RSI it's above 70
    • divergence - when an indicator and stock price move inversely which foreshadows a coming change in the price
    • whipsaw - when trade signals & price suddenly reverse either stopping you out or making you exit your trade
    • resistance - an area on a chart where price can't seem to go higher. The main reason is that no one is willing to buy above that price or there's more sellers than buyers.
    • support - an area on a chart where price can't seem to go lower. The main reason is no one is willing to sell below that price or there's more buyers than sellers.
    • breakout/breakdown - when price breaks support or resistance
    • alerts - a notification for when price hits your desired target, some software allows you to place the alert direction on a chart
    • level ii - This shows all bid & ask orders from market makers, usually your broker charges a fee for this, and is only really usual for day trading
    • trend line - can be a moving average, previous day's high, an indicator, you can even draw a line connecting all the highs or lows for example
    • Market participants - also includes market makers, institutions, and retail & institutional investors. Different markets have different participants such as futures (hedgers & speculators) and forex (banks & speculators).

    Useful indicators

    • Moving average (MA) - lagging indicator that averages previous prices, for example MA 20 will average the previous 20 days; MAs do not predict price movements, they smooth out price changes. Common averages are 10, 20, 50, 100, and 200. Typically you use 2 to 3 per chart.
    • RSI - relative strength index, takes the average gain of the stock price divided by the average loss over a number of periods, default 14; starts to reverse when it points down from 70 (sell signal) and reverses agian when it points up from 30 (buy signal)
    • VWAP - intraday indicator, takes the average price and weighs it by volume, basically you want to be short below VWAP and go long above VWAP; near the VWAP line (or price) there can be lots of whipsaw
    • MACD - combines momentum & trend indicators; gives off many trade signals including ovebought/sold and divergence, see link here note that the histogram in the center shows how wide the MACD & Signal line are from each other
    • ATR - Average true range gives a number that tells you how wide price movements are, great for helping set stops. ATR on a daily chart of 5 means average price movement of 5 points, typically you would have a stop loss 2x ATR so in this case it would be 10 point wide stop. If a stop loss of 2x ATR is too high for you, then trade a different stock.
    • Bollinger Bands (BB) - takes the standard deviation of price times 2 (default); in statistics, 95% of all values are within 2 standard deviations. BB is typically used for resistance and support, more info here.
    • Ichimoku clouds - Combines even more indicators, good for beginners, see here

    Methods or Systems

    • Trend Following - Basically you're buying shares as a stock is going up or shorting as it's going down. Investopedia's intro to trend trading.
    • Fading - shorting as price falls from resistance, or buying as price rises from support
    • Channels - very much like fading except you find 2 parallel trend lines that price has been bouncing between, see here
    • Patterns - Double tops, head & shoulders, and cup & handle are the most watched for, see here for more, don't get too caught up in patterns.
    • Breakouts/Breakdowns - while patterns can be attractive, breakouts/breakdowns happen all the time; here's one way to take advantage of them
    • Pivots - these used to be for pit traders in the exchange, just 5 numbers they needed to navigate the day's price movements, but are still used online and stock prices tend to breakout or reverse off these pivot lines

    Strategies: See the TA wiki here as this will be a work in progress, feel free to reply with your own strategy.

    See our past daily discussions here. Also links for: Technicals Tuesday, Options Trading Thursday, and Fundamentals Friday.

    submitted by /u/AutoModerator
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    Don't worry stocks are about to turn around.

    Posted: 24 Dec 2018 10:22 PM PST

    I lost all my gains for the last 5 years. I'm going to sell all my positions before I start losing my principle. So with my past investing luck, there is a really good chance that stocks will immediately rebound.

    submitted by /u/catfarts99
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    We are NO WHERE close to 2008 levels. This downtrend is NOT cause of economic woes, but lack of leadership and chaos in Washington and the world. The slowdown is expected to be moderate growth levels experienced from 2011 to 2017- NOT recessionary levels.

    Posted: 25 Dec 2018 12:24 PM PST

    https://www.nytimes.com/2018/12/24/upshot/the-economy-is-still-strong-the-risk-for-2019-is-that-leadership-turns-a-mild-shock-into-a-crisis.html?smid=fb-nytimes&smtyp=cur

    Its apparent that the market has gotten ridiculously SPOILT due to the extreme growth in 2017 and 2018.

    Everyone should just calm down. The economic numbers DO NOT indicate a recession, but a slowdown. ( not that it would help in reducing the fear in the markets)

    submitted by /u/Waitwhonow
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    Learning stocks

    Posted: 25 Dec 2018 12:47 PM PST

    Hi everyone,

    ​

    I am a 19 year old college student and I am becoming more and more interested in investing. When I was 14 my grandfather passed away and he gave me $5000 to invest with under my parents guidance. However, now I have saved up $1000 and I am looking to learn more about to stock market so I can invest it.

    ​

    So what I am asking is,

    1. Are there any good books/websites you read to learn about investing?
    2. Since the stock market is doing poorly now would it be a good time to invest?

    Thanks for the help!

    submitted by /u/malhksin
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    Where are my chart guys?

    Posted: 25 Dec 2018 01:08 PM PST

    All the other hearsay aside and I know it's just one indicator, but are there any of you out there who use Fibonacci retracements that could answer a few questions? Google does an alright job but particularly which high and low do you use? I'm very confused by this and can't seem to find a correct answer

    submitted by /u/Jimmy31987
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    how to invest in usa stocks from europe

    Posted: 25 Dec 2018 09:18 AM PST

    hi, I'm new to this, and have limited knowledge of the system.

    I'm interested in making long term investments in few tech companies (intel, amd,...), and few biotech companies. what's the best way for someone from EU to buy stocks of these firms. also, what are the most obvious things I dont know of when getting into this sort of investments (taxes, fees, etc.).

    submitted by /u/Lilith5th
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    Vanguard Roth IRA hasn't moved whole month?

    Posted: 24 Dec 2018 10:42 PM PST

    Curious as to whats going on with my Vanguard Roth IRA, it has not moved at all up or down, even with the market tanking. I don't know if these update shown online are live or not, but I typically get my statements the first week of each new month.

    If thats the case, I might not see the bloodbath until January when my statement comes out. Curious if anyone else might know whats going on.

    Thanks in advance.

    submitted by /u/zthrowaway281
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    r/Stocks Daily Discussion Tuesday - Dec 25, 2018

    Posted: 25 Dec 2018 04:07 AM PST

    These daily discussions run from Monday to Friday.

    Some helpful links:

    If you have a basic question, for example "what is EPS," then google "investopedia EPS" and click the investopedia article on it; do this for everything until you have a more in depth question or just want to share what you learned.

    Please discuss your portfolios in the Rate My Portfolio sticky..

    See our past daily discussions here. Also links for: Technicals Tuesday, Options Trading Thursday, and Fundamentals Friday.

    submitted by /u/AutoModerator
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    I think maybe we should be worried now,

    Posted: 24 Dec 2018 11:39 PM PST

    I posted this thread a while ago, and now to my dismay I see this happen today https://imgur.com/a/HawtzZ9

    I can't help but think the two are correlated, the 10 yr yield chart being the precursor to what can only be a long line of dumping across the board, today being the start.

    Does anyone have any ideas of how I could finally be wrong? I desperately need reassurance, but I will prepare for the worst I suppose.

    submitted by /u/FreckledMil
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    What would you call Q4 2018???

    Posted: 25 Dec 2018 10:51 AM PST

    How to draw accurate trend lines for bearish and bullish stocks?

    Posted: 25 Dec 2018 09:55 AM PST

    Before I begin, I want to preface by saying I have just entered the elusive realm of technical analysis and I am not sure if this is the best place to post this but it is what it is. Also, thank you in advance to those that try to help me, with any bit of information :)

    ​

    I've been taking notes and reading Investopedia's "Technical Analysis Basics" and they never really mention how to draw an accurate trendline. I looked online and found one video but it was still confusing. I understand the purpose of using trendlines but to accurately draw one, even after trying for about 30 minutes on Tradingview, I still can't do it.

    I assumed that it would work at any time, with any group of candlesticks (as that is the style of chart that I am using).

    ​

    submitted by /u/swagmonster55
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    Can newspapers and journalists use the information of their forthcoming articles to make stock purchasing decisions?

    Posted: 25 Dec 2018 02:01 AM PST

    Hi beautiful people, I was wondering, can newspapers, as organizations, and journalist use the information of their investigative journalism or whatever, for example uncovering a scandal in some publicly trade company, to make stock purchasing decisions before the story has been released by the newspaper?

    submitted by /u/gayporn111
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    New to this, advice asked

    Posted: 24 Dec 2018 11:01 PM PST

    Hey there Guys.

    Ive Wanted to get into stocks for a while now, and seems everything seems to crash now i thought Maybe this is the time to get it.

    So i live in the netherlands and got about 500 euro's to begin with. Any tips?

    Excuses me if this is the wrong way/aub

    submitted by /u/Trippehh
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    Zoom Inc IPO - my bet it will be the most profitable tech IPO of 2019

    Posted: 24 Dec 2018 03:18 PM PST

    For anyone who uses zoom or knows how beloved their product is, you'll understand why this thing is bound to explode upwards. Also rated the best company to work for on Glassdoor. Its got the trifecta. Customers love it, employees love it, and their SaaS business model is absolutely murdering and growing like crazy

    submitted by /u/BigSalad
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    Most common/basic indicators used for minute to minute intraday trading?

    Posted: 24 Dec 2018 02:43 PM PST

    I'm familiar with MACD, RSI, volume of course. Any other suggestions for minute to minute intraday trading? Any specific combinations someone had great success with? Thanks

    submitted by /u/bsd65
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