Thomas R. DeMark is a successful technical trader whose two technical trading manuals, The New Science of Technical Analysis (1994, Wiley Press) and New Market Timing Techniques (1997, Wiley Press), are known for their analytical and intelligent approach to financial markets. As well, he’s assembled a fascinating collection of proprietary technical indicators.
Category : Indicators Tags : demarker, demarker oscillator, forex trading, oscillator
Forex trading is based upon momentum. A trending currency pair builds momentum from traders who believe in that trend, sufficient to crash through support and resistance levels. A range-trading pair loses momentum at these levels as investors jump off the bandwagon, slowing, stopping, and finally turning. And a consolidating currency pair can’t seem to build sufficient momentum to go anywhere.
One technical indicator for determining momentum is the accelerator oscillator. Designed and described by trader Bill M. Williams in his book Trading Chaos (Marketplace Books by John Wiley & Sons, 1995), the accelerator oscillator compares moving averages over various intervals to determine if the currency pair’s price action is losing momentum or gaining it.
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Category : Technical Analysis Tags : accelerator, accelerator oscillator, Forex, oscillator
The stochastic oscillator was developed by trader George C. Lane in the late 1950s and it was designed to measure the level of buying or selling pressure within a stock. Specifically, the stochastic relates the most recent closing price to the range of highs and lows achieved over a certain number of time periods. In simplest terms, if the closing price is most often closer to the high, then there’s buying pressure, but if the closing price is most often closer to the low, then there’s selling pressure.
When trading with online stock platforms, the stochastic is most often shown within a separate window beneath the chart. Similar in appearance to the RSI but with two lines, one representing a longer duration (called the %K) and the other a shorter duration (the %D or the trigger line), readings above 80 are considered overbought and readings below 20 are considered oversold.
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Category : Analysis Tags : oscillator, stochastic, stochastic oscillator, stock analysis
