AMIBroker is one of the most famous Algo-Trading Tools available in the market today, which uses AFL Scripting. We can use AMIBroker to create, back-test and deploy and strategy. This post is the placeholder for sharing AMIBroker AFL Data Feed for September 2021. Note: These files contain data feed up-to 1 minute. We are providing…
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How to draw trendlines methodically for Extremes (Valley’s and Peak’s)
Rules To Draw A Trendline:
1. Identifying potential reversals. We don’t need an opposing zone eliminated in order to draw a trendline, it can be used as confluence. If an opposing zone is eliminated then we’ll have a trend.
2. We should be Connecting the last two bullish or bearish impulses on every timeframe of our sequence.
3. Learn as soon as possible when opposing impulses are being created on your trading timeframe, if that happens we must lean on timeframes higher than the one when we start seeing opposing impulses. If the trend is down and bearish impulses are being created, what would you think if the next impulse is bullish and stronger than the last bearish impulse? Wouldn’t you think the market dynamics for that timeframe are changing? Exactly. That’s the reason why the trendlines are drawn like this.
4. The break of a trendline with a full OHCL candle will create a potential imbalance.
5. Using trendlines in combination with multiple timeframe analysis and the sequence can give you the exact point where a new trade setup can occur.
6. Trendlines can signal that a change in trend may occur.
7. We’ll need at least two touches of the trend line connecting the latest two obvious valleys and peaks (swing lows and swing highs), the more touches the TL has the more structured and powerful the trendline and trend will be.
Today we are going to learn about Channel pattern
The channel is a powerful yet often overlooked chart pattern and combines several forms of technical analysis to provide traders with potential points for entering and exiting trades, as well as controlling risk. The first step is to learn how to identify channels. The next steps include determining where and when to enter a trade, where to place stop-loss orders, and where to take profits.
Channel Elements:
A channel occurs when the price of an asset is moving between two parallel trendlines.
1. Upper Trendline: The upper trendline connects the swing highs in price. If price breaks out of a trading channel to the upside, the move could indicate that the price will rally further.
2. Lower Trendline: The lower trendline connects the swing lows in price. If the price breaks below the bottom of the channel, on the other hand, the dip indicates that more selling could be on the way.
3. The channel can slant upward, downward, or sideways on the chart.
Types of Channels
A channel consists of at least four contact points because we need at least two lows to connect to each other and two highs to connect to each other. Generally speaking, there are three types of channels:
1. Channels that are angled up are called ascending channels.
2. Channels that are angled down are descending channels.
3. Ascending and descending channels are also called trend channels because the price is moving more dominantly in one direction.
4. Channels in which the trendlines are horizontal are called horizontal channels or rectangular trading ranges.
How to create algo for RSI Trigger Line strategy?
Condition:
The moving average of RSI indicates the average momentum, while RSI indicates current momentum. So we are trying to buy when RSI crosses above its moving average.The short RSI period of 7 is used to generate sufficient signals. The Moving Average period used is 15, arbitrarily the double of RSI period.
Buy: When RSI crosses above its trigger line and RSI>60
Sell: When RSI goes below trigger line and RSI<40
Reverse is applicable for shorting.
AMIBroker is one of the most famous Algo-Trading Tools available in the market today, which uses AFL Scripting. We can use AMIBroker to create, back-test and deploy and strategy. This post is the placeholder for sharing AMIBroker AFL Data Feed for August 2021. Note: These files contain data feed up-to 1 minute. We are providing…
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How To Draw A Trendline?
1. Connect the latest two obvious valleys (swing lows) and peaks (swing highs).
2. These valleys and peaks must be clear and obvious. If they are not, consider them as pauses. If they are not clear basing should be unclear and poor and removal would be expected anyway.
3. Update the trendline every time there is a new valley or peak
4. Each timeframe has its own trendline independent from other timeframes and this is where subjectivity comes into in other methodologies
5. Continuation Patterns (CPs) will not be used to connect trendlines unless there are 3 or more (over-extension)
How to invest in US equity from India?
Short answer: Try to Invest in a cost-effective manner. For smaller corpus, it makes sense to invest via India-domiciled mutual funds that invest overseas, while for someone with a larger corpus, it could be cheaper to invest directly
Different parts of Double Top pattern
There are three major parts which forms this pattern.
1. First Peak – Inverted V/U – The market does a pullback and forms an inverted V/U shape. At this point, there’s no way to tell if the market will reverse because a pullback occurs regularly in a trending market.
2. Second Peak– Inverted V/U – The price gets rejected at the same area, again. This is a first sign that the market could reverse lower. This forms the second inverted V/U shape
3. The trendline – This is the last line of defense for the buyers. If the price breaks below it, the market could reverse, head lower and begin the start of a downtrend.
Once you identify the double top formation, just draw a straight line in bottom which connects swing lows of the peaks. We will get a technical breakout when the price gives breakout below the line drawn.
What differentiates successful trader from and a failed trader?
A good experienced trader will make a thorough analysis of the situation before jumping in. He might take a look to see where crude oil is on a chart, considering: Is it overbought? How much risk is involved? How much can he hope to make on the trade, and so on? After meeting any criteria he may have, he will next look to time an entry if he has decided to get in. One of the things that make this trader better is that after deciding to buy, but before getting in, he will start to make an exit strategy for the trade. After getting in he will evaluate the trade on a regular basis. Basically, he would have a both a plan of attack and a defensive strategy for the trade, or more precisely he would have a game plan for the trade from start to finish. But a new trader won’t have any plan and won’t follow it if he/she has one.
This Simple, Subtle difference is what differentiates a new trader from an experienced trader. Or you could say, it is the difference between a losing trader and a winning trader.
How to write algo for Stoch Crossover System?
Condition:
Stochastic is an oscillator that measures the position of a stock compared with its recent trading range indicating overbought OR oversold conditions. It displays current Day price at a percentage relative to it’s trading range over the specified period of time. In a Slow Stochastic, the highs AND lows are averaged over a slowing period. The default is usually 3 for slow AND 1 for fast. The line can then be smoothed using an exponential moving average, Weighted, OR simple moving average. Confirming Buy/Sell signals can be read at intersections of the %D with the %K as well.
The Stochastic Oscillator always ranges between 0% AND 100%.
• A reading of 0% shows that the security’s Close was the Lowest price that the security has traded during the preceding x-time periods.
• A reading of 100% shows that the security’s Close was the Highest price that the security has traded during the preceding x-time periods.
• When the closing price is near the top of the recent trading range (above 80%), the security is in an overbought condition AND may Signal for a possible correction.
• Oversold condition exists at a point below %20. The security is in an oversold condition AND may Signal for a possible upmove.
• Whenever stoch makes a crossover we will initiate the trades accordingly.