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Tuesday, 8 December 2015

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The art of Trading with Indicators

There are many ways to trade effectively in the Stock Market. The technical analysis is one of the ways which is used by a majority of the Traders. In the technical analysis the price and the volume are studied and historic price movements are used to anticipate the future price movements. There are more than dozen of indicators available in the Stock market to trade and anticipate the price movements.
Some of the common indicators used in the Technical analysis are MACD, RSI, Bollinger Bands and moving averages. The moving averages are the simplest of the indicators being used in the Technical analysis. MACD stands for moving average convergence and divergence. In case of this indicator two moving averages of different periods are drawn and convergence and divergence of these two moving averages is watched. The crossovers of the moving averages are seen as possible chances of trend reversals.
Besides the MACD, Bollinger band is an indicator which is used extensively by the technical analysts. The Bollinger bands are formed with the positive and negative standard deviation of the moving averages. The price movement is confined between the upper band and the lower band. A breakout from the bands can be taken as the potential chance of trend reversals. A breakout from the upper band can be considered as the start of the downtrend. And a breakout from the downtrend can be taken as a potential chance of starting of an uptrend.

The new traders can also trade on the advice and support of the advisory firms like Money Classic Research. The advisory firms provide the accurate stock market tips in the form of buy and sell calls with proper stop loss. Money classic research is a reputed advisory firm which is both SEBI registered and ISO certified.

1 comments:

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