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Trend-following indicators are technical tools that measure the direction and strength of trends in the chosen time frame. Some trend-following indicators are placed directly on the price panel ...
Surveys that show overwhelming bullishness, for example, are evidence that an uptrend may reverse; the premise being that if most investors are bullish they have already bought the market (anticipating higher prices). And because most investors are bullish and invested, one assumes that few buyers remain. This leaves more potential sellers than ...
On the technical analysis chart, a wedge pattern is a market trend commonly found in traded assets (stocks, bonds, futures, etc.).The pattern is characterized by a contracting range in prices coupled with an upward trend in prices (known as a rising wedge) or a downward trend in prices (known as a falling wedge).
For example, the price of a share reaches a high of $30.00 on Wednesday, and opens at $31.20 on Thursday, falls down to $31.00 in the early hour, moves straight up again to $31.45, and no trading occurs in between $30.00 and $31.00 area. This no-trading zone appears on the chart as a gap.
A "candlestick pattern" is a movement in prices shown graphically on a candlestick chart. This separation shown on the chart, is said to be caused by an exhaustion gap and the subsequent move in the opposite direction occurs as a result of a breakaway gap.
Some more examples of market bottoms, in terms of the closing values of the Dow Jones Industrial Average (DJIA) include: The Dow Jones Industrial Average hit a bottom at 1,738.74 on October 19, 1987, following a decline from 2,722.41 on August 25, 1987. This day is commonly referred to as Black Monday (chart [22]).
The horizon chart is a variation of the area chart. Having established a horizontal axis, negative values are mirrored over the horizontal axis, while positive values retain their position. As an alternative approach, rather than reflecting negative values, they can be shifted so that the smaller value aligns with the horizontal axis.
A chart pattern or price pattern is a pattern within a chart when prices are graphed. In stock and commodity markets trading, chart pattern studies play a large role during technical analysis. When data is plotted there is usually a pattern which naturally occurs and repeats over a period. Chart patterns are used as either reversal or ...