Most reliable indicators of an impending stock move up or down, be they Technical or Fundamental.
Collated by Kdoc
Poster: Ibza
Date: 09/01/15
Time: 16:35:44
Post #: 14561382
I'm a massive fan of RSI (Relative Strength Index). For the non TA it's a momentum indicator with values ranging from 1 to 100. If the RSI is greater than 70 the stock is said to be overbought, if it is less than 30 it is regarded as oversold.
RSI on the daily chart usually flags an upcoming short retrace in price if the stock is overbought, sometimes a trend change.
I've recently noticed that when a stock is severely oversold on the weekly chart such as less than 20, the stock bounces back immensely and sometimes starts a new trend. ………….
………..What I've also worked out is that smart money appear to accumulate for a long period of time. It's good for us small players because we can watch them, then easily move in and out of a stock.
Poster: Fibonarchery
Date: 09/01/15
Time: 17:51:38
Post #: 14561727
Price resistance breakouts on volume, OBV (On Balance Volume), saucers/rounded bottoms, trendline breaks
….Always makes me sit up if both FA and TA align... like a magnifying glass focusing the sunlight.
Poster: valen1828
Date: 09/01/15
Time: 17:57:14
Post #: 14561744
Im still working with my linear movement . I use the obv also a little but realy do not concentrate on volume till i like a chart and just see if i can buy or sell when i want . I alos concentrate with scans and sticking with them for pattern recognition.I have an interest in bell curves and cup and handle patterns mostly .
I also have gone back to the trix as think i had it all wrong before and use it with forty day crosses of the price line . I find the forty day crosses mostly a couple of days before the trix which is standard setting for the chart program i use .
Exit is also using same at the moment and mostly all is just trials and speculation as i follow them more and look for the pivot points . As i scroll charts and backtest trades ive done before im finding my scans do seem to be matching somewhat the rules im starting to put in place and the indicators i am trying tune to same rules and same scans possibly similar or same stocks in a certain time frame in the market . ie in thier pattern that may develope .
The pivot points im not using any formula but price line and congested candles type of candle to back test the trix and my linear.
Poster: Ibza
Date: 09/01/15
Time: 19:42:17
Post #: 14562124
When I've found an RSI based setup then I try and use other TA before I purchase for confirmation. Other TA like trendlines, chart patterns, changes in volume etc...
For example AZZ at the moment is oversold on the weekly, but it hasn't broken out of it's downtrend yet and the RSI hasn't started to perk up yet.
Weekly chart of AZZ;
This was another one played by the big guys.
In general, I use a mixed bag. All the stuff I mentioned plus Candlesticks, moving averages, gaps in uptrends. I like looking at the day's trades to see if there are any odd trades such as trades with a volume of 1, trades before market open and during closing auction, CX and cext trades. I check out the Shortman (http://shortman.com.au/) to see if the shares are being shorted. I like looking at http://www.investsmart.com.au/ to see if there are broker recommendations, for amusement purposes, to see if there are brokers with an interest in certain stocks. Their actual recommendations are occasionally reliable.
I want to learn more about candlesticks, VSA, this OBV indicator and Fibonacci trading. This trading world has so many aspects you can explore.
Poster: J8
Date: 09/01/15
Time: 20:20:00
Post #: 14562245
I don't let the course of trades get to me. Far too much good research time is wasted on trying to answer questions with no answers. I do watch them but remain aloof. It's all smoke and mirrors.
Rising volume on the weekly albeit a tick at a time. Price and MA turning up. Not exactly smoke signals but I like to get set a little earlier if FA fits.
Poster: keygeo
Date: 09/01/15
Time: 21:54:37
Post #: 14562558
can't argue with any of fibs - price with volume, trend channels etc.
I also like hopping onto an established trend, if its an upward trend then at the lower edge of the trend channel ideally.......then if the stock moves against you it only has to move a small distance before it has moved out of the trend channel where the stock is on caution ..........if you buy more towards the top of a trading band of an upward trending stock then it has much further for the stock to retrace before it crosses the lower trend line into caution territory and, so a larger loss is incurred before you can justifiably consider discarding......
and remember, trends quite often continue a lot longer than you think....
market depth, which gives the buy/sell ratio is something i use as a narrow window on the left hand side of my screen in a bar chart format ......we know that market depth can often be misleading because we don't know what the brokers have in their order books...... but the direction, or change in direction in the buy/sell ratio day by day can give an indicator of the mood, or change in mood of the market...... in fact i don't know why there is not some type chart available to measure the ratio over period of time ...... when i talk of the ratio i mean the no. of shares on the buyers side divided by the no. of shares on the sellers side...... a number less than one means a negative sentiment while a number greater than one is positive ........
the buy/sell ratio can also give a much earlier indication of the likely movement or change in movement of a stock......
to look at a stock chart over a year or say a few years gives an indication of what the market thinks of it, and as to whether it is a stock with growing profits or declining profits or perhaps its an indication of other influences ie. local or world economic information, political etc.
and the markets is always right......
another good saying is - trade what you see on the screen in front of you, not on some fixed ideas you might have in your head....
Poster: jeans_sammy
Date: 10/01/15
Time: 00:43:45
Post #: 14562958
Mostly I try to align FA with TA. Once stock has good FA to show the right direction; I use numbers of TA ingredients such as MACD, RSI, Volume and Moving Averages along with all Candle stick patterns (Engulfing, head & shoulder, double top, double bottom etc etc) for a good recipes to entry and exit. Though most of my investment and trade are backed by Fundamentals, TA helps a lot to provide a correct sense to enter and exit the stock at the right time (Not always but mostly).
Poster: J8
Date: 10/01/15
Time: 01:25:24
Post #: 14563036
Looking at different time spans on charts of the same stock gives out clues. Some are a it hard to quantify and I suppose you can find anything you want one way or another. Buying on the bottom of a channel when you are confident in your fundamentals is a good guide. I will stop out of a stock much quicker if I buy in this way. I don't always try and buy the lows, sometimes the trend is your friend and you can make money faster by following it.
Finding tops and exits....... Every time is different. I make it up as I go. As a rising stock approaches a gap I may be one of the early exiters.
Poster: nihilism
Date: 10/01/15
Time: 04:04:35
Post #: 14563150
I don't think there will ever be a holy grail as markets have periods of opportunity for different indicators. As an example, the second half of 2012 ignored almost every technical indicator on spec stocks, it was a horrible time to be a trader imo, but also learnt some valuable (although costly) lessons.
The overall stock market volume in that period was severely lower too, which is probably why many indicators failed to follow through, lack of trader activity to watch for the signs perhaps?
Where as 2014 was a great year imo for specs, so many could be called from simplistic TA that I've been focussing on which simply involved basic patterns (flag, wedges and bowls) and price vs volume and price vs RSI(MSI) divergence/continuance.
Poster: forrestfield
Date: 10/01/15
Time: 16:47:36
Post #: 14564490
As I only try to find companies where potential is multi bag (successful or not that is different lol) therefore I quite often focus on FA. Particularly dead cats trading at a tiny market cap close to cash back or project value potentially 3-5 times market cap along with directors and top 20 holding quite a few shares, tightly held even at times with large register (ideally close to 350-400m shares) enough liquid so I don't have to pay premiums while buying (selling is quite often not a problem as when something big happens there are enough buyers to sell), very importantly leading into a major event may it be drilling, results or some other catalyst event and the most important is TREND IS YOUR FRIEND.
Poster: Freehold
Date: 10/01/15
Time: 19:56:02
Post #: 14564947
As far as FA Indicators go its not quite as obvious as TA ... but still quite useful .....but I'll have a Stab.
1. Does the Company have any cash. If not any half decent rally will attract a cap raise within 5-10 days (Companies general use the 10 day Vwap to set the cap raise price). So if you bought a rally and your still in 10 days after the initial day of spike then expect dilution and major price drop.
2. Spurious and hard to believe claims made by Mgmt which have low or no cash. Desperate people will do desperate things to keep their dream alive. be sceptical
3. A Ex stock broker being on the board of a company is a major negative indicator for me ... Dodgy with a Double DD. Buyer beware. Once a saw company like this that claimed near on 200 Bt of Coal in QLD ... only to go bust ... What the ? QBL has a whiff of this but I think they actually have some thing tangible.
4. Prev History of Directors ... almost all directors, are directors, for purely selfish reasons.. in fact on the whole most couldn't give a toss about shareholders and find them as a just nuisance and pain in the backside. Occasionally you will find one that has some integrity. If you find one such and the and the Companies FA story is good then it is highly probably that you will make good money in the short med and long term. If fact the companies that have made the most Coin from are where the directors are untainted by the Market industry . Do a Google search on the co Directors to see what you find.
5. The bullshit detector... If you intend to hold a stock for anything more that a short term trade then assume the story of a company is a fabrication or clever marketing and make sure you prove the story is tangible/real before committing... only very few Co's eventually prosper on the ASX 1 in 100 ?... Why because there are too many folk seeking to make their fortune out of listed companies but realistically only limited idea's in which to do so. So speak to the directors/ read everything you can find on the co and if their is a whiff of BS then move on.
6. Barriers to Entry ... Understand what barriers exist to competitors entering the same market. Approved patents are a good start.. But if you if you find someone with a good idea what's stopping the next guy replicating the product service etc.
7. Key FA Milestone are great indicates for FA .. for mining Co.'s its easy... Company value it tied to certainty .. IE Inferred jorc is not as valuable as indicated, indicated is not as valuable as Measured, Etc. DFS/bank study is more valuable or better that Scoping or any Prelim studies ETC . So when a company is about to announce an upgraded resource or Study then that should translate to an upgrade in value. In a similar vain for Biotechs is the level of efficacy and testing that makes the value, ie, clinical trials 1 ,2 3. the higher the level the more certainty there is.
8 . Peers - Laggards in a sector that is moving are a gift unless there is something FA wise which is holding them back. Examine peers closely.
9. Disruptors - Anything that comes along that exploits or make another existing product redundant is a disruptor and likely to perform well...EG Apples IPhone ?
10. Income stream - If a company has a regular income stream or is likely to generate and income stream in the short term them you should look closely at it as .. The price movement in the market are a function of expected earnings.
All the above are FA indicators ... ignore them at you peril ...
There are many more this is just a taste...
Poster: pilsner
Date: 10/01/15
Time: 20:44:16
Post #: 14565058
my favourite indicator is neither FA or TA it is my own emotion. If I ever start to feel like I am some sort of trading god or If I get burnt with a couple of trades in a row.....I usually take a few days off. Nothing worse than having emotions involved either positive or negative. Best to just remain neutral.
Poster: Fibonarchery
Date: 10/01/15
Time: 21:08:58
Post #: 14565111
I agree re market depth, forgot to include that one... it gets a bashing on HC as its easily manipulated but why do you think its manipulated? Because enough people pay attention to visual onscreen market depth to make it a self fulfilling prophecy.
And Im not talking about dummy 10 million unit bids at .001 on a 5c stock, more big bids higher up in the queue, but not quyite high enough to get sold into. On a liquid stock if you just pay attention to the top 3 bid lines and bottom 3 sell lines, that is defi9nitely worth while.
