Granola, Toby lent a nice clarification of Stochastics. Hope you don't mind if I comment more on TA. But, please keep in mind I am novice here, too, learning as I go.
iqc.com
The top graph is the candlesticks interpretation of daily action.
Below this are graphs for Stochastics, RSI, and Momentum. A simple type of TA is the use of Stochastics (supported by RSI and Momentum) when deciding to buy, sell, or hold.
When both lines are above 80 and the blue line is above the green line, watch for the blue line to cross the green line downward--this is a warning to sell. If RSI and Momentum also go south, strongly consider selling.
Similarly, when both lines are below 20 and the green line is above the blue line, watch for the blue line to cross the green line upward--this is a warning to buy. If RSI and Momentum also go north, strongly consider buying. A simple but reasonable use of TA.
You may also want to become aware of the double top formation--strong sell signal. I lost thousands because I didn't know this.
In regard to wfmi, stochastics is still bullish. Using the above scheme, if RSI and Momentum turn north, the bull has more support. Of course, the general market may have too much bear in it for this to happen.
hope this helps
--marc |
