Tuesday, March 06, 2007
Technical Indicators
Zig Zag
The Zig Zag indicator shows past performance trends and only the
most significant changes. It does this by filtering out any changes less than a
specified amount.
The Zig Zag indicator is used primarily to help you see changes by highlighting
the most significant reversals. Understand that the last segment in a Zig Zag
chart can change based on changes in the underlying plot, price being only one
example. That is, a change in a security's price can change a previous value of
the indicator. Since the Zig Zag indicator adjusts its values based on subsequent
changes, it has perfect hindsight into what prices have done. Do not try to
create a trading system based on the Zig Zag indicator, as it to be used to
illustrate historical patterns.
The Zig Zag indicator is calculated by placing imaginary points on a chart when
prices reverse by at least the specified amount. Straight lines are then drawn
to connect these imaginary points. Any changes in prices that are less than the
specified amount are ignored.
Read More...
Trading Education
Tutorial
Volume Climax
Volume Helps Identify Reversals
Various price patterns can alert us to potential reversal
candidates. Trendline Breaks, Support and Resistance Levels, Fibonacci
Retracement Levels and other price information are valuable in determining a
change in direction for a security. However, one of the most overlooked chart
patterns that help us determine reversals is not reflected in the price itself.
Volume climaxes are easily identifiable and valuable in assessing a change in
market sentiment.
Read More...
NASDAQ Chart of the Day
HIMX
is winding up within a large triangle pattern that could offer a solid breakout
opportunity. Watch this pattern for key movement.
Daily Trading Signals
NYSE Chart of the Day
OMG
has broken a major lower trend line at 47.00, which is highly bearish given the
major uptrend that was violated. Look for more weakness beneath this zone.
Daily Trading Signals
Daily Market Commentary
Updated Monday, 3/5 for Tuesday's market.
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Key DOW Levels for 3/6
|
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UP
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Above 12,200
|
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DN
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Below 12,050
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Sideways Day...
- Dow trades mostly sideways throughout the session, holds at
critical support. The index eventually closed the day with a 64 point loss and
is now holding at critical support at 12,050.
- The NASDAQ and S&P each traded back and forth throughout the session
today, followed by heavy selling to the Close. Look to support for the next key
move tomorrow.
Summary
The Dow closed the day with a loss after reversing sharply from the day's highs
under 12,200. The index is now sitting on critical support at 12,050, which is
the major line in the sand to watch for key directional movement.
Read More...
