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Beyond Technical Analysis

MARKET GAPS - Short and Simple explanationGAPS are areas on the chart where no trading activity took place. In an uptrend, for example, When the opening price is higher than the highest price of a previous day, leaving a blank space on the chart, it will be called a GAP-Up opening. Likewise, in a GAP-DOWN situation, the opening price will be lower than the previous day's lowest traded price. Now we will go through different types of gaps, how to identify them, and what they may signal. TYPES OF GAPS : NORMAL GAP : From the name itself, it's a fairly common type of GAP. Such common gaps are made with lower volume and can be spotted frequently on hourly/daily charts. Common gaps are most likely to be filled . Such gaps can be used strategically to plan entries. For example, when the market made this gap (Referring to nifty chart), I was certain that it will be filled, and as soon as the market touched line L1, I took a CALL position hoping that market will bounce back after filling this gap. BREAKAWAY GAP : Breakaway gap occurs after forming patterns (Triangles, Wedges, etc) or breaking major trendlines signally a possible trend reversal. This gap is formed with heavy volume signaling a significant market movement. Consider this: If an Ascending triangle pattern formation is spotted and there is a break with high volume forming a gap, it's a sign of an uptrend. RUNAWAY/MEASURING GAP : This type of gap occurs when the market is in a particular trend for a while. Runaway / Measuring gaps signals a strong momentum in a trend. Say, the market is in an Uptrend, and a runaway gap occurs, this means the market is strong and will continue the upward movement. In an uptrend, it signals Strength, whereas, in a downtrend, it signals weakness in the market. This type of gap occurs with moderate volume. This is also known as measuring gaps because they generally occur at about halfway in a trend . EXAUSATION GAP : This last type of gap can be spotted at an end of a move. This gap is quickly filled and signals a reversal. For example, the market is moving in an uptrend and an upward gap appears that fails to sustain and slowly fades away. This signals weakness in the uptrend and a trend reversal may happen shortly. Prices closing under the gap will signal that an exhaustion gap has been formed. This type of gap indicates a state of panic in the market . TIPS : Volume is an important factor while identifying gaps. It is important to include other indicators/patterns to confirm the movement while trading gaps. //Healthy discussion is really powerful. Let's start one in the comments. Feel free to through in your ideas// Follow me to get notified of my new posts/analyses, I will be very active on this platform :)
NSE:NIFTYEducation
by pranaytrades
2
MARKET GAPS - Short and Simple explanationGAPS are areas on the chart where no trading activity took place. In an uptrend, for example, When the opening price is higher than the highest price of a previous day, leaving a blank space on the chart, it will be called a GAP-Up opening. Likewise, in a GAP-DOWN situation, the opening price will be lower than the previous day's lowest traded price. Now we will go through different types of gaps, how to identify them, and what they may signal. TYPES OF GAPS : 1) NORMAL GAP: From the name itself, it's a fairly common type of GAP. Such common gaps are made with lower volume and can be spotted frequently on hourly/daily charts. Common gaps are most likely to be filled. Such gaps can be used strategically to plan entries. For example, when the market made this gap (Referring to nifty chart), I was certain that it will be filled, and as soon as the market touched line L1, I took a CALL position hoping that market will bounce back after filling this gap. 2) BREAKAWAY GAP: Breakaway gap occurs after forming patterns (Triangles, Wedges, etc) or breaking major trendlines signally a possible trend reversal. This gap is formed with heavy volume signaling a significant market movement. Consider this: If an Ascending triangle pattern formation is spotted and there is a break with high volume forming a gap, it's a sign of an uptrend. 3) RUNAWAY/MEASURING GAP: This type of gap occurs when the market is in a particular trend for a while. Runaway / Measuring gaps signals a strong momentum in a trend. Say, the market is in an Uptrend, and a runaway gap occurs, this means the market is strong and will continue the upward movement. In an uptrend, it signals Strength, whereas, in a downtrend, it signals weakness in the market. This type of gap occurs with moderate volume. This is also known as measuring gaps because they generally occur at about halfway in a trend. 4) EXAUSATION GAP: This last type of gap can be spotted at an end of a move. This gap is quickly filled and signals a reversal. For example, the market is moving in an uptrend and an upward gap appears that fails to sustain and slowly fades away. This signals weakness in the uptrend and a trend reversal may happen shortly. Prices closing under the gap will signal that an exhaustion gap has been formed. This type of gap indicates a state of panic in the market. TIPS : Volume is an important factor while identifying gaps. It is important to include other indicators/patterns to confirm the movement while trading gaps. //Healthy discussion is really powerful. Let's start one in the comments. Feel free to through in your ideas// Follow me to get notified of my new posts/analyses, I will be very active on this platform :)
NSE:NIFTYEducation
by pranaytrades
AN ADVICE TO THE BEGINNERS IN TRADING FROM A HARD WAY LEARNERLEARNING IS A PROCESS JUST WE ALL HAVE GONE THROUGH OUR SCHOOL DAYS. THANKS TO THE PARENTS WHO GIVE THEIR STUDENTS A TUTOR TO GUIDE. ELSE IF WE ALL HAD NOT TAKEN HELP FROM THE TUTOR . I DOUBT WE HAD LEARNT ANYTHING. TUTOR IN THE SENSE CAN BE SCHOOL TEACHERS, PRIVATE TUTION TEACHERS, OUR OWN PARENTS TOO. HENCE WE NEED AN ADVISORY HELP JUST LIKE A TUTOR TO HELP US IN ORDER TO SURVIVE THE MARKET IN THE BEGINNING DAYS. ELSE THERE IS A HARD WAY TO LEARN EVERYTHING. TILL THAT HARD TIME OVERS AND YOU SURVIVE THEN YOU CAN APPLY YOUR LEARNINGS IN YOUR PRACTICAL LIFE. I MEAN TO BUILD A SETUP OF YOUR OWN AND WHAT'S ITS WINNING PROBABILITY IS WHAT A BEGINNER OR AN INTERMEDIATE TRADER FAILS TO DEVELOP. IN THE EARLY DAYS, A BEGINNER TRADES AND LOSE THE MONEY ON A CONSTANT AND IN A REGULAR BASIS. BEFORE THAT I THINK THEY MUST FIND A MENTOR AND THEN GET INTO THE TRADING FLOOR. THERE ARE SO MANY ADVISORY WHO GIVES OR PROVIDES TRADE CALLS. DO YOU REALLY THINK THE ARE BOTHERED ABOUT YOUR LOSS OR PROFIT? DO YOU REALLY GET TO LEARN ANYTHING ? PROFIT OR LOSS SCREENSHOT DOESNOT MATTER HERE . WHAT MATTERS IS THE KNOWLEDGE OF THE MARKET. HOW MUCH YOU ARE LEARNING FROM YOUR MISTAKE. HOW CAN YOU CONTROL YOUR GREED AFTER CONSECUTIVE PROFITS. HOW YOU TACKLE YOURSELF AFTER 10 CONSECUTIVE PROFITS AND THEN A LOSS OF YOUR 5 DAYS PROFIT IN A DAY. CHANNELS SHOWING YOU PROFIT SCREENSHOT IS BASICALLY DOING THERE ADVERTISING AND EVENTUALLY YOU BECOME GREEDY. ITS A NICE TRICK TO ATTRACT CUSTOMERS. AS YOU ALL KNOW STOCK MARKET IS A BUSINESS NOT A CASINO. SO IF YOU SEE A SCREENSHOT OF 30 LAKH PROFIT THAT MEANS THE CAPITAL OF THAT PERSON IS NOT 50 THOUSAND OR HE IS NOT A RETAIL TRADER LIKE US. BASICALLY BE REALISTIC WITH YOUR GAINS . THERE IS A TERM CALLED PERCENTAGE. BANKS NOW GIVE YOU 5% (JUST AN APPROX) AS INTEREST IN A FIXED DEPOSIT SCEME SO WHY ARE YOU THINKING OF GETTING 100% OF YOUR CAPITAL FROM STOCK MARKET . MINDSET IS EVERYTHING. AS MR. RAMESH DAMANI ONCE SAID GIVE ME 1 CRORE AND I WILL GIVE YOU 10 LAKHS PROFIT. LOOK I THINK 10 LAKH IS A LOT SUM OF MONEY TO ME BUT WHAT HE TRIES TO SAY IS CALCULATE THE PERCENTAGE OF YOUR PROFIT TO THAT OF YOUR CAPITAL. I GUESS IT WILL BE FAR MORE THAT THE BANKS INTEREST WHICH THEY OFFER YOU. SO IF YOU APPROACH THE MARKET IN THAT WAY THEN YOUR PROBABILITY OF SURVIVAL IN THE MARKET INCREASES AND YOU HAVE A CONTROL OF YOUR GREED AND EVENTUALLY YOU WILL BE THE ULTIMATE GAINER. AFTERALL EVERYTHING IS A PROBABILTY GAME AND THERE IS A SURVIVAL OF THE FITTEST. LAST BUT NOT THE LEAST , THE GAME IS TO SURVIVE AND NOT WINNING EVERYTIME OR MAKING PROFIT. AT THE END REMEMBER ONE THING THE MORE YOU SURVIVE THE MORE MONEY YOU MAKE.
NSE:NIFTYEducation
by Shruti_Advisory
1
Heikin Ashi Charts vs. Candlestick ChartsFollowing price action is at the core of markets. One glance at a chart can show you a trend, trade idea, or serve as a quick way to check the holdings in your portfolio. Candlestick charts are one of the most popular ways to look at price action. A single candlestick shows the high, low, open, and close for a specific time period. This means that a lot of price information is stored in a single candlestick . However, sometimes, that price information is filled with volatility or chaotic trading. That's where Heikin Ashi charts are most useful - they smooth out the price by showing an average price range rather than the exact measurements. In fact, Heikin Ashi charts were developed in Japan and the word Heikin means “average” in Japanese . For those who invest over long-term horizons or look for sustainable trends, Heikin Ashi charts can be an effective way to smooth out price and show clearer trends. The key to understanding Heikin-Ashi charts is to remember that each bar, whether it's red or green, shows an average price range for a specific time period whereas a candlestick chart shows the exact price levels for that time period. The formula for a Heikin Ashi looks like this: Open = (Previous bar open + previous bar close) / 2 Close = (Open + High + Low + Close) / 4 High = Highest point whether it's the open, high, low or close Low = Lowest point whether it's the open, high, low or close Make sure to test out these two different chart types and have some fun. There is no better way to learn than to compare and contrast the two types of charts as we are doing in this example. Remember, it is also about your personal preference. Do you want to see every granular detail in price action? Or do you want to see an average price of that trading action? This is entirely up to you and the tools are here for you to try. NOTE While Heikin Ashi and other non-standard charts can be useful to analyze markets, they should not be used to backtest strategies or issue trade orders, as their prices are synthetic and do not reflect bid/ask levels at exchanges or brokers. If you need more information to understand why that is, have a look at these publications:  • In the Help Center: Strategy produces unrealistic results on non-standard chart types (Heikin Ashi, Renko, etc.)  • From PineCoders: Backtesting on Non-Standard Charts: Caution! Thanks for reading and please leave any comments or questions if you have them! Comment : P.S. Someone asked how they can select Heikin Ashi. Click the dropdown at the top of your chart where it currently shows either your Candlestick or Line chart options. Then select Heikin Ashi from the dropdown menu.
Education
by TradingView
2
Creating Lines with ShortcutsCreating lines on a chart is one of the most fundamental methods of charting when performing technical analysis . Being able to create these effectively and quickly is a very useful skill to have. Horizontal, Vertical and Cross lines can all be found on the drawings panel to the left of the chart in the subgroup “Trend Line Tools”. These tools can be added by selecting them from the subgroup and then placing them on the chart. However, a more efficient method to creating these lines is to utilize the hotkey functions: Horizontal Line Shortcut: - Alt+H (PC), or Option+H (MAC) Vertical Line Hotkey: - Alt+V (PC), or Option+V (MAC)

 Cross Line Hotkey: - Alt+C (PC), or Option+C (MAC) Becoming more efficient in your ability to draw lines on your chart will allow for quicker identification of areas of support/resistance and times on your chart. Be sure to visit our help center to learn more about these tools! More information on the Horizontal Line tool: www.tradingview.com More information on the Vertical Line tool: www.tradingview.com
 More information on the Cross Line tool: www.tradingview.com
Editors' picks
BITSTAMP:ETHUSDEducation
by TradingView
19
Consistent Trader - Chapter 3Market structure keep on changing as per the participants mindset and sentiment. The way a trader handles his trade changes according to that For example, if you are driving in a highway, you can drive fast. Inside the city you are not allowed to drive fast. Similarly, according to the market structure you have to use your trading strategy, risk management and trade management. Sticking to one strategy in all market conditions wont make a trader money. Understanding market structure comes by experience, but developing it depends on the trader’s flexibility. For example in an extreme bullish market, buying when the price breaks the resistance is right and profitable. In normal bullish market, buying at the support is profitable. Because of over confidence about his strategy and believing his strategy is a holy grail an intermediate level trader applies the same strategy in all market conditions (Please refer to chapter – 1 to know about intermediate level trader). Are you struck with one strategy or one trading style? Do you believe your strategy is supreme? Well it is time for you to rethink about it now. (To be continued next week...)
CEducation
by vanathi
15
MARKEY CYCLES PSYCHOLOGY | EMOTIONS & COGNITIVE BIASES All markets go through cycles of expansion and contraction. 📈When a market is in an expansion phase (an uptrend), there is a sentiment of optimism, belief, and greed. Typically, these are the main emotions that lead to a strong buying activity. Sometimes, a strong sense of greed and belief overtakes the market in such a way that a financial bubble can form. In such a scenario, many investors become irrational, losing sight of the actual value and buying an asset only because they believe the market will continue to rise. They get greedy and irrational by the impressive bullish movement, expecting to make huge profits. As the market gets heavily overbought, the local top is created. In general, this is considered to be the point of the highest risk. In some cases, the market will start a sideways movement while smart money steadily sells the asset. This is also called the distribution stage. However, some markets don't present a clear distribution stage, and the downtrend starts sharply after the top is reached. ➖➖➖➖➖➖➖➖➖ 📉 When the market starts reversing, the euphoric mood can quickly turn into complacency, as many traders refuse to admit that the uptrend came to an end. As prices continue to fall, the market sentiment quickly moves to the bearish side. It often includes feelings of anxiety, denial, and panic. In this context, by the anxiety we mean the moment when bullish biased market participants start to question why the price is falling, which soon leads to the denial stage. The denial period is marked by a sense of unacceptance. Many investors keep holding their losing positions, either because "it's too late to sell" or because they want still believe that "the market will come back soon." But as the prices drop even lower, the selling wave gets stronger. At this point, fear and panic often lead to what is called a market capitulation (when holders give up and sell their assets close to the local bottom). Eventually, the downtrend stops as the volatility decreases and the market stabilizes. Typically, the market experiences sideways movements before feelings of hope and optimism start arising again. Such a sideways period is called the accumulation stage. ❤️Please, support this idea with a like and comment!❤️ ⬇️Subscribe to my social networks!⬇️
OANDA:XAUUSDEducation
by VasilyTrader
2
THE CYCLE OF MARKET EMOTIONS “Control your emotions or be consumed by them.” This is exactly how the financial markets play. You need to be cautious enough to surf the wave of emotions. An illustration as to how quickly our emotions change with respect to the market movement has been explained with the help of NIFTY’s weekly chart. Optimism: It is the hopefulness and confidence about the future or the success of something. We step in the markets and have the hope and confidence of succeeding against all odds. Excitement: Excitement drives in when the market moves in the direction we hoped. Excitement also brings motivation for future endeavors. Thrill: When the momentum carries on, the gains that we’ve made give us thrill and we further expect higher returns. Euphoria: As the cycle tops, there comes the state of utmost satisfaction where we start to believe that we made smart moves and the same will continue without realizing the uncertain nature of the markets. We tend to fool ourselves by now playing beyond our appetite. At this point, the financial risk is at it maximum, like the possible financial gain. Denial: When the market turns, we watch intently for a favorable move so as to save ourselves from being a victim of loss. Anxiety: As the market continues to plunge, anxiety sets in. We see our investment values declining and this is the first time that you experience the market going against you. You now hold onto the investment as you don’t want to book losses and here in, you see yourself as a long term investor. Fear: When the losses accelerate, fear kicks in. At this point, we might even pick riskier choices to recover our losses. Depression: The reality of the bear market makes us depressed and question our conscience about the moves we made. We become desperate to overcome it. Panic: Having no idea of what to do next and thinking that we had a chance to book our profits makes us panic-stricken and at this point, we might make unusual decisions that may cause further damage. Capitulation: Understanding that the market isn’t predictable, we feel helpless and dump our investments. Despondency: Having booked losses, We now reflect the choices we made and wonder whether we should have invested in the first place? We now have low spirit and confidence and this is the point when we miss out great financial opportunities. Hence, It is the point of Maximum financial opportunity. Skepticism: As the market starts making higher lows and higher highs, We’re in doubt and stay cautious to outlook if the trend will last. Hope: The uptrend remains intact, we might feel reluctant to re-invest but looking at the attractive scope, We hope to make gains. Relief: The market now seems to be recovering. For the ones who let their emotions take control, the cycle might again begin.
Editors' picks
NSE:NIFTYEducation
by GurleenKaur
151
How to Draw Fibonacci Channels Fibonacci Channels are used to determine fibonacci support and resistance levels within an identified trend. These channels can easily be drawn in both uptrends or downtrends to find potential areas where price action could change. Uptrend When drawing a Fibonacci Channel on an uptrend, a clearly identified trend needs to be established with higher lows being created. To draw the channel, first select the two low points on the trend, and then the high point in-between them. After the channel is drawn, the Fibonacci levels calculated can be used to help speculate price action by watching these areas as support or resistance. Downtrend When drawing a Fibonacci Channel on a downtrend, a clearly identified trend needs to be established with lower highs being created. To draw the channel, first select the two high points determined by the trend, and then the low point in-between them as shown below. Do you use Fib Channels? If so, share your ideas in the comments below!
Editors' picks
Education
by TradingView
27
Trader's Mindset !The Pyramid showing how successful traders identifies their strength in the world of professional trading. Numbers may not be the perfect one but the idea behind this pyramid is to understand that most people spend most of their time in finding the best strategy which we know that does not exist. Strategy : - The top of the pyramid is strategy, which is really important but not as much as we think. off course we have to have a rule for entry, exit, and take profit. Risk Management: - We put risk management in the middle of the pyramid which shows that this is the 2nd most important thing that needs to be discussed. We must control our risk on each and every trade. Mindset/Psychology: So, we have put the trading psychology in the bottom of pyramid which means the trader's mindset is the foundation of his/her successful trading career. This trading education series around these three pillars will be continued ........ :)
OANDA:XAUUSDEducation
by thebullstreet07
Using the Trend-Based Fib Extension ToolThe Fibonacci ratios are widely used among traders to help identify potential areas of reversal in the movement of price action. The Trend-based Fibonacci Extension tool utilizes three points on a previously identified trend in order to draw the Fib ratios on the chart. In the chart above, price was rejected twice forming a double top which is a fairly strong reversal pattern. To help identify potential areas of support and resistance we have drawn a Trend-Based Fib Extension. Using the double top patterns High, Low, and High as the three points for the Trend-Based Fib Extension, the Fibonacci ratios are drawn on the chart. In this example, you can see that price action respected these levels very well until finding strong support at a potential bottom that corresponds with the 200% extension level. But, notice the region in the yellow box on this chart. There seems to be no identified areas where the Fibonacci ratios show support or resistance. While retrospectively we can tell that the area of support found at ~ $12 (141.4%) in mid-November 2017 did not produce a new bull market. At the time there was a potential reversal at that region resulting in higher highs and therefore we could have pulled a NEW Trend-Based Fib Extension as shown below. As the new Trend-Based Fib Extension is identifying areas of a new uptrend, we see that these ares are shown in a way that they were not in the previously drawn Trend-Based Fib Extension. However, price was rejected at the 61.8% level and continued downward until the 0% extension level was broken, thus invalidating this Trend-Based Fib Extension. While the upward price trend did not continue, there was a local high that was made and thus could be utilized to create another Trend-Based Fib Extension to further identify areas of reversal for the continuing downtrend as shown below. Looking at this newly created Trend-Based Fib Extension, we see that the areas moving down to the 78.6% extension level are very well respected, at which time the price found support, creating a triple bottom reversal pattern. It is interesting to note that the 78.6% extension on this Trend-Based Fib Extension pull is at $1.82, and the 200% extension level from our first Trend-Based Fib Extension pull was at $1.95, a mere $0.13 difference in price. This area where the two levels of a Trend-Based Fib Extension or Retracement group together is know as a Fib cluster and indicates areas of strong support or resistance. With price forming a triple bottom and reversing from this level, is it possible that this is the bottom of this downtrend? Could a new Trend-Based Fib Extension now be pulled from a new Low/High/Low to identify potential areas of support and resistance? Give it a try and see what you find!
Editors' picks
NYSE:AMCEducation
by TradingView
10
Consistent Trader - Chapter 2Market is dynamic. You cannot predict market will behave in a certain way. Market movement is based on probability and your trading reflects it. The price movement gives the information about the trend. From that we form perception/view about market. Our perception is the basis for the trading. Changing the perception becomes a problem for some people. For example “Person A” has bullish view about the market before it opens. Market opened gap up and shows the sign of reversal. If “Person A” do not change his perception by understanding the reversal signs, he will lose money. Similarly changing the view often is also not good. If you change your view about the trend for each and every candle formation, then you won’t get clarity about market trend. Now lets come to the important point. How to overcome it? Have high probability trade set ups and trading strategies. Trade only when your trade set ups form. You will have more clarity and confidence when you follow the tested trade set ups and trading strategies. Do you want to reduce the intermediate phase duration? Avoid taking random trades. Always have a plan about handling market movements. Once the market opens, your emotions will be highlighted and at that time processing the information, planning the trade and deciding what to do becomes tough. How you perceive the market with your trade setups and trading strategy decides your success. (To be continued next week...)
CEducation
by vanathi
14
How To identify whether stock is bottoming out? This Idea is my Bank of Baroda Positional Trade in diwali. Posting this because I got one query for my Recent BHEL Idea, where I've used similar Technique. As you can see 57 level marked with blue line is the level from where stock gave breakout twice, 2007 & 2009. it was a strong Resistance back then. In 2007 it moved from 54 to 92 In 2009 it moved from 54 to 211 Another important level was at 38. When market crashes in march 2020 it was moving in a band pf 38 to 57. Double bottom was also formed in that band. Another thing i observed was that stock was moving away form 200 EMA So mean reversion was also pending. 200 EMA was around 103 which was more than double. There was also a volume spike. Overall these made me conclude that stock was bottoming out . Based on buy call was at 46 during Diwali for a target of 92 baeed on support and resistance levels. Check zoomed pick below
NSE:BANKBARODAEducation
by varadtambolkar
10
SHK on the verge of long term trend reversal.Inverse Head and shoulder pattern. This pattern appears when a trend is about to reverse. After years of down trend, stock is showing trend reversal on weekly charts. Huge volumes indicate there is accumulation complete. Accumulation phase is followed by participation phase. Here Participation phase and pattern breakout will go hand in hand. Chemical stocks are buzzing but SHK hasn't performed till now. Idea published just for educational purpose.
NSE:SHKEducation
by varadtambolkar
2
How To Add Emojis To Your ChartIf you publish a lot of research from your TradingView account, emojis will give readers another way to engage with your work. Emojis are recognized globally and can help others better understand how you're thinking or feeling. They can also be used as quick reminders or notes. Here's how you can add emojis to your chart: 1. Copy and paste an emoji directly into the text box tool like this 👋. If you need help finding an emoji to copy and paste, there are several websites that make this easy to do. You can add emojis to any text box or drawing tool that supports text. 2. The second method is to use the Signpost tool. The Signpost tool is located in the Annotation Tools menu on the left-side of the chart. Select the Signpost, place it on the chart, and then open its settings to add an emoji. The Signpost tool can be used to leave detailed notes at specific price levels. It is easy to use, fully customizable, and it can be dragged to any point on your chart. We've included a few examples on the chart above where we've also customized the background color of each Signpost. 😎🐻 🥶🐂 Thanks for reading! Let us know if you have any questions or comments. Our team is always listening and waiting to help.
Editors' picks
NASDAQ:COINEducation
by TradingView
13