Sure glad to help....Here are some of my most frequent references, this should get you started and keep you busy for a while.
1. How to Make Money in Stocks, A Winning System in Good Times or Bad by William J. O'Neal.
2. Trader Vic - Methods of a Wall Street Master, Victor Sperandeo with T. Sullivan Brown.
3. CandlePower by Gregory L. Morris.
4. Internet Reference Sites: dailystocks.com; dailyrocket.com.
Stocksmart.com is no longer a free site. Below I've summarized the particulars regarding Bollinger Bands, Moving Averages, and Stochastics:
1. HOW BOLLINGER BANDS ARE GENERAL USED:
When stock's price is in a trading range, moving up & down but basically moving sideways:
- A SELL signal is generated when price touches upper band.
- A BUY signal is generated when it touches lower band.
When stock's price is trending up:
- A BUY signal is generated when price moves towards lower band [in strong uptrend, may not touch lower band].
When stock's price is trending down:
- A SELL signal is generated when price moves towards upper band [again, may not touch in strong trend].
WHEN THE STOCK'S PRICE MOVES OUTSIDE EITHER BAND, IT IS INTERPRETED AS A CONTINUATION OF CURRENT TREND.
2. HOW MOVING AVERAGES ARE GENERALLY USED:
- A BUY signal occurs when stock's price rises above MA line.
- A SELL signal occurs when stock's price falls below MA line.
MA Example = Average stock price for a specified price period. MA computed by using open, high, low or closing prices. Given a 10-day period on close: MA value computed by adding closing price & each past 9 days and dividing sum by 10 to obtain average price for 10-day period.
3. HOW STOCHASTICS ARE GENERALLY USED:
Stochastics compare stock's current price (open, high, low or close) against it's price range for a period of time ranging from 0-100%. Again, suppose 10-day: value of 0% indicates current price of stock is LOWEST price stock has traded during past 10 days; value of 100% indicates HIGHEST. Generally, when % falls below 20 and rises back above 20 indicates a BUY signal. Same for 80% - when it rises above and falls back below indicates a SELL signal.
Happy investing/trading.... |
