The Chaikin Money Flow is a technical analysis indicator that is used to measure the buying and selling pressure in a stock over a period of time. Intro In the world of trading, huge market movements are usually triggered by the actions of giant hedge funds, mutual funds, pension funds, brokers, and other whales that trade the vast majority of volume, as opposed to small investors and traders. If you can identify where these whales are going to put their money next, then you can make massive returns. This is why technical analysis indicators/oscillators are so import ..read more

  What’s up everyone? Ross here from Warrior Trading. So in this video, I’m going to talk to you about the 4 indicators every beginner trader should have on their charts.   Number one, you should be using candlestick charts. If you’re not already using candlestick charts, step back, slow down. You got to start using them. If you’re using line charts, using bar charts, they are not going to cut it for day trading. You’ve got to be using candlestick charts. A candlestick gives you four pieces of information: the open, the close, the high and the low. So those four pieces of informatio ..read more

The Island Reversal Pattern is a chart pattern that involves a gap in price, consolidation and then another gap in the opposite direction (creating an island of candles as you’ll see in the below charts). Intro In their attempt to understand the movement of prices in different financial markets, pioneers of technical analysis techniques have found out that the price of a stock or security usually follows a specific direction after forming a specific pattern. This discovery has become a trading discipline, which is widely used by traders today. While there are several categories of chart patter ..read more

All right, so in this episode we’re going to talk about gaps and windows on both daily charts and intraday charts. Get the Micro Pullback Strategy PDF download and more free gifts here This again is another episode in this multi-part series on technical analysis and how to read stock charts, especially for day trading. But again, not exclusive to day trading. If you’re a short-term investor or swing trading, you can certainly apply gaps and windows to those strategies as well because we’re going to talk quite a bit about daily charts. Now, a reminder as always, these levels are critical and t ..read more

Most of the mainstream trading literature is chock full of references to patterns with funny names, like the megaphone pattern. To novices looking to learn the ropes, this can come off as a practice in reading tea leaves or moon cycles. And while the trading world admittedly has its fair share of quacks, the purpose of learning stock market patterns is not to memorize enough patterns that you know exactly where the market is going at a given time. Instead, patterns are heuristics. They’re rough guides that allow you to quickly categorize and understand price action. So, while the “megapho ..read more

A pivot point is a crucial turning point in the price of a stock or security that a lot of traders tend to trade around. It’s basically a price at which the stock stops going up or down and reverses in the opposite direction. It’s the price at the foremost extreme of a rally.  Pivot points can only be accurately identified after the fact, as you need to have price action following the pivot point to know if it’s actually a pivot point.  How to Find Pivot Points? There are two views on pivot points in trading: technical and discretionary. Finding Pivot Points Through Quantitative Mean ..read more

A candlestick shadow represents the extremes of where the price visited during the life of a candlestick on a chart before closing at its ultimate price. On a bullish candlestick, the shadows represent the difference between the closing price and the high price (upper shadow), and on a bearish candlestick the shadow represents the difference between the open price and the low price (lower shadow).  The Basics of How Candlestick Charts Work If that is at all confusing, let’s go over the basic definition of a candlestick. A candlestick on a chart looks like the following: It represents the ..read more

The trend is an important feature of trading that traders use to help them read the market movement better, so they can execute their trading strategies at the perfect moment. Trend strength simply refers to the level of influence buyers or sellers have over the market over a particular time. In a weak downtrend, the trend may be bearish, but it still experiences great upward pressure. But in a strong downtrend, the trend is completely bearish, and the bulls usually watch from afar. This article will highlight the Average Directional Index (ADX), which is an important indicator that is used to ..read more

Technical trading is such a diverse method of trading that you really can’t pigeonhole it. There’s trend traders, mean reversion traders, breakout traders, and pullback traders. You can trade support and resistance levels, forecast volume and volatility, or even do technical analysis on the VIX or the Federal Reserve’s balance sheet (maybe that’s not a great idea though!). And the quality of said analysis varies very widely. On a long or short enough time frame, there’s a technical trading strategy that correlates to nearly whatever intellectual non-technical trading/investing strategy you can ..read more

  A mountain and a hill both have ups and downs, but the slopes of a hill are likely to be less steep compared to those of a mountain. If you are hiking and using a street map as your guide, it might be challenge to determine the steepness of the slopes. You may need to use a detailed trail-mapping hiking app to help you do a comprehensive analysis of the topography. Similarly, when looking at trends on stock charts, it may be easy to spot a bullish or a bearish trend, but it can be even more important to determine the strength of that trend and when it will make a reversal. As traders of ..read more