The picture below shows how I select which stock to trade. The stock explorer will run a series of stock scanning scripts for me to select the stock to trade for the next day. The stocks that are selected by the scanner have to go through 5 different sets of programming scripts in order to show up for my selection.
Once the stock is selected for analysis, I will open up the chart to analyze the technical aspect such as price & volume action,
Looking for underlying strength or weakness of the recent week in order to decide whether a trade should be executed.
Z-OBEE HOLDINGS LIMITED is select by the explorer therefore I will open the chart to analyze further.
Basically, I will draw trend and channel lines to determine the most probable support or resistance area.
Moving Averages are just for reference on price action. The top indicator is created to reveal the volume activity of the stock. For example, when price is going higher but the volume is much lower as compared to the previous few sessions, the top indicator will show reduced strength for the day. This hints that the demand could be slowing down due to the supply available in the market and a possibly short-term resistance will surface soon.
With the chart, there are many expert signals such as “Professionals are distributing”,”Go Long”, “Go Short”, “Mark Up”, “Reduced Selling Pressure” and much more. There are about 35 different signals that will show up automatically as price moves each day.
The difference about these signals are that there are many criteria to meet in order for the signal to appear and most of the requirements will depend on the future activity to produce a signal.
E.g. “Go Long, Dark Blue Diamond” will only appear on the next day (today+1day) when price at market closure meets certain criteria before a Diamond signal will appear on the chart.
Once a Blue Diamond appears, there is high possibility that the trade will go along with the upward direction of the trend.
On the other hand, when a Orange Diamond appears, it is meant for shorting (Sell short) only. By counting the number of
“Go Long” and “Go Short” candidates scanned by the explorer, I am able to tell the current market condition whether it is good for long or short orders.
For example, there are 20 Long candidates and 4 Short candidates pick up by the explorer. Immediately, I have strong faith that the probability for Long trade is higher then the short trade.
“Always follow the trend until it is bent”
The color-coding on the price bar, the trend cluster below the volume bar provides a vivid picture where the market is heading next.
For example:
1) The top indicator show green vertical bars denoting that there is strength to the upside as demand has overcome the supply.
2) The price bar has just changed from negative red to positive green denoting that it is bullish.
3) The trend cluster has also change from Red(weak market) to Green(strong market)
With the above three criterias met, 1) Geen Vertical bar, 2) Green Price Bar, 3) Green Trend Cluster, you should know that I will be going to trade on which side of the market to have the best probability of success.
Some reasoning behind the signals as below:
a) Lack of demand – as price goes higher, demand get lesser each day
b) Professionals are distributing – certain group of professionals could be taking profits but this does not mean that the market will change phase.
c) Reduced Selling Pressure – after few days of heavy selling, price starts to go sideway with lesser downside pressure
d) Test base – this could be the low area for recent price action, price may go either direction depending on the next few days
after this signal is showed.
e) Demanding coming in – There is a strong pressure building up to push the price higher.
f) Stopping a down move – very excited selling down with enormous volume to a new low area and at the end of the day, price is above 50% of the spread
There are many more indicators that I have built over the years and I enjoy developing more and more signals to make trading fun and easy.
A deep regret with this trading system is that, it is not a ROBOT and I need to watch over the trade each day. How I hope that this system of mine can be automated like Fapturbo. If you would like to know more of Fapturbo Forex Automated System, visit this URL: http://www.fapturbo-guru.com/freebook.html.
The author is kind to give freely a Forex ebook which I can start to learn more about Forex Trading as a newbie.
SGTrader
(Owner of Six Blogsites begin with “chartfreely”)
PS: SGTrader has been requested to post an analysis on EUR/USD currency pair for the next post, stay tuned for more updates!
PPS: If you have an article you would like to contribute to FapTurbo, feel free to write to us at cs@fapturbo-guru.com
