Elliott Wave Theory Forex
What are the technical indicators Forex?
A technical indicator is a series of points used to predict the movement of currency during a financial product or other. You will find below the technical indicators are the most famous and learn to build your own technical indicators. * The index Relative Strength (RSI)
* The Stochastic Oscillator
* Moving Average Convergence / Divergence (MACD) [Convergence and divergence in motion *] Media
* Number theory
* Waves
* The holes or trenches
* Trends
* Chart formations
The index Relative Strength (RSI):
This index is an indicator of popular scholarship. The RSI measures the ratio of the trends upward in relation to established and normalizes the calculation so that the index is a number between 1 and 100. If the RSI is 70 or higher then the instrument is seen as overbought (a situation in which prices have risen well above market expectations). An RSI of less than or equal to 30 indicates an instrument in an oversold position (a situation in which prices have fallen much more than the market had anticipated).
Stochastic Oscillator:
It is used to indicate the conditions for overbought / oversold conditions on a scale of 0-100%. This indicator is based on the observation that a strong upward trend, closing prices tend to concentrate on the highest part of the extended period. Conversely, when prices are strong for the trend, closing prices tend to concentrate on the lowest of the extended period.
Stochastic calculations produce two lines,% K and% D that are used to indicate areas of overbought / oversold on a graph. The discrepancy between the stochastic lines and the stock price of the underlying instrument gives a signal to trade powerful.
Convergence / Divergence half (MACD):
This indicator consists of two lines of momentum. The MACD line is the difference between two exponential moving averages and the signal line is an exponential moving average of the difference. If the line and the MACD signal crossing the line, this is considered a sign reversal is likely.
Number theory:
The Fibonacci sequence:
The Fibonacci sequence (1,1,2,3,5,8,13,21,34 … ..) is constructed by adding two numbers to get to third. The ratio of any number in compared to 62% is next, which is a popular Fibonacci reserve figure. The inverse of 62%, which is 38%, is also used as a drop in Fibonacci sales (used with the theory of Elliott wave, see below)
Gann Angles:
WD Gann was a trader in the value of the shares and who worked in the '50s and have performed more than 50 billion dollars in the market. He made his fortune using methods developed as tools for the trade based on the relationships between price movement and time, known as equivalent time prices. There is no simple explanation on the forms Gann, but in general, the angles used on the maps to identify support and resistance areas and predict future changes in trends. He also used lines in charts to identify areas of support and resistance.
Waves:
The theory of Elliott wave:
The theory of Elliott wave analysis is a market approach that is based on repetition wave patterns and the Fibonacci sequence. An ideal model of Elliott wave consists of five waves followed by three waves rising on the decline.
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The lagoons or ditches:
Gaps are spaces left on the bar chart where no trading has taken place. Having an empty space or hole upward is formed when the lowest price for a day is greater than the highest price the previous day.
A gap or down-down gap is formed when the higher price for a day is less than the lowest price the previous day. Having a space is usually a sign of market strength, while a down gap is a sign of market weakness.
A gap or fracture gap is a price difference which is when an important price pattern is complete. This points the beginning of a significant price movement.
An exhaust hole or gap is a price gap that forms in the center of a major market trend. For this reason, the measure is called a gap.
A vacuum gap or dyspnea is a price gap that occurs at the end of an important trend and indicates that the trend is coming to an end.
Trends:
Trends indicate the direction of prices. The peaks and valleys of the upward trend on the rise, and peak and valley of decline are the trends that define the low slope of the trend. The breaking of a trend line usually indicates a reversal. A change in trade is characterized by horizontal peaks and valleys.
Moving averages are used to harmonize information price in order to confirm trends and support and resistance levels. They are always useful in determining a specific marketing strategy for a dealer or futures markets with a strong up or down.
For simple moving average, price is an average over a number of days. Day after day, the oldest price is removed and replaced by the current price of the day – and changes daily average. For exponential moving averages or weighted, using same technique, but provides the figures – the lowest weight for the oldest and highest coefficient for the price later.
Table of formations
Examples of graphic formats: (triangle, rectangle, head, shoulders and back)
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