101. Near the beginning of important moves, oscillator analysis isn’t that helpful and can be misleading. Toward the end of market moves ,however ,oscillators become extremely valuable.
102. When the oscillator reaches an extreme value in either the upper or lower end of the band, this suggest that the current price move have gone too far too fast and is due for a correction of some type.
103. The oscillator is most useful when its value reaches an extreme reading near the upper or lower end of its boundaries. The market is said to be overbought when it is near the upper extreme and oversold when it is near the lower extreme. This warns that the price trend is overextended and vulnerable.
104. A divergence between the oscillator and the price action when the oscillator is in an extreme position is usually an important warning.
105.-Oscillator-The crossing of the zero line can give important trading signals in the direction of the price trend.
106.Because of the way it is constructed, the momentum line is always a step ahead of the price movement. It leads the advance or decline in prices , then levels off while the current price trend is still in effect. It then begins to move in the opposite direction as prices begin to level off.
107. RSI is plotted on a vertical scale of 0 to 100. Movements above 70 are considered overbought, while an oversold condition would be a move under 30 .Because of shifting that takes place in bull and bear markets, the 80 level usually becomes the overbought level in bull markets and the 20 level the oversold level in bear markets.
108. The first move of RSI into the overbought or oversold region is usually just a warning. The signal to pay close attention to is the second move by the oscillator into the danger zone. If the second move fails to confirm the price move into new highs or new lows, a possible divergence exists. At that point ,some defensive action can be taken to protect existing positions. If the oscillator moves in the opposite direction, breaking a previous high or low, then a divergence or failure swing is confirmed.
109. Stochastics simply measures , on a percentage basis of 0 to 100, where the closing price is in relation to the total price range for a selected time period. A very high reading (over 80) would put the closing price near the top of the range ,while a low reading (under 20) near the bottom of the range.
110. One way to combine daily and weekly stochastics is to use weekly signals to determine market direction and daily signals for timing(it depends from the type of the trader). It’s also a good idea to combine stochastics with RSI.
111. Most oscillator buy signals work best in uptrends and oscillator sell signals are most profitables in downtrends. The place to start your market analysis is always by determining the general trend of the market. Oscillators can then be used to help time market entry.
112. Give less attention to the oscillators in the early stages of an important move, but pay close attention to its signals as the move reaches maturity.
113.The best way to combine technical indicators is use weekly signals to determine market direction and the daily signals to fine-tune entry and exit points. A daily signal is followed only when it agrees with the weekly signal. (daily-weekly, 4 hour-daily,4 hour-1 hour).
114. The failure of prices to react to bullish news in an overbought area is a clear warning that a turn may be near. The failure of prices in an oversold area to react to bearish news can be taken as a warning that all the bad news has been fully discounted in the current low price. Any bullish news will push prices higher.
115. -Elliot Wave Theory- A complete bull market cycle is made up of eight waves, five up waves followed by three down waves.
116 -Elliot Wave Theory- A trend divides into five waves in the direction of the longer trend.
117-Elliot Wave Theory- Corrections always take place in three waves.
118-Elliot Wave Theory- Waves can be expanded into longer waves and subdivided into shorter waves.
119-Elliot Wave Theory- Sometimes one of the impulse waves extends. The other two should then be equal in time and magnitude.
120-Elliot Wave Theory- The Finobacci sequence is the mathematical basis of the Elliot Wave Theory.
121-Elliot Wave Theory- The number of waves follows the Finobacci sequence.
122-Elliot Wave Theory- Finobacci ratios and retracements are used to determine price objectives. The most common retracements are 62%, 50% and 38%.
123 -Elliot Wave Theory- Bear markets should not fall below the bottom of the previous fourth wave.
124 -Elliot Wave Theory- Wave 4 should not overlap wave 1.
125 .Support and resistance are the most effective chart tools to use for entry and exit points. For purposes of placing stop loss, support and resistance levels are most valuable.
126. One of the commodities most effected by the dollar is the gold market. The prices of gold and the U.S. dollar usually trend in opposite directions.
127. The Yen is sensitive to changes in the price or structure of the raw material markets.
128. The commodity-producing countries (Canada, Australia, N. Zealand ) are more dependent on Japan than the other way around.
129. The Yen is sensitive to the fortunes of the Nikkei index, the Japanese stock market and the real estate market.
130. The majority of the pound transactions take place in London with a volume decreasing significantly in the U.S. market, and slowing down to a trickle in Asia. Therefore, in the New York market, many banks have to stop quoting the pound at noon.
131. Swiss Franc has a very close economic relationship with Germany, and thus to the euro zone.
132. The major markets are London, with 32 percent of the market,New York with 18 percent and Tokyo with 8 percent. Singapore follows with 7 percent, Germany has 5 percent and Switzerland, France and Hong Kong have 4 percent each.
133. Don’t use the markets to feed your need for excitement.