a presentation on technical analysis of stocks_chirag

8/4/2019 A Presentation on Technical Analysis of Stocks_chirag

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Meaning of TA

Difference between FA and TA

Types of charts Dow Theory

Supports & Resistance

Patterns & Indicators and analysis

Conclusion


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Technical Analysis is a art of predictingfuture price movements with the help ofhistorical price and volume data.

TA assumes that history repeat itself in

terms of price movements and thereforeit is predictable.

TA provides best entry and exit time forthe stocks.

TA requires lots of study and continuesmonitoring of graphs.

It has little to do with FA.


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TECHNICAL ANALYSIS

Predicts short tem price

movements

Focuses on internal market

data

Appeals to short term traders

FUNDAMENTAL ANALYSIS

Establishes long term value

Focuses on fundamental

factors

Appeals to long term

traders


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BAR CHARTAlso known as OHLC

(Open,high,low,close)


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Japanese Candle stick.


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Line chart

It is the combination of all the latest price

close.


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Originated by Charles Dow in 1901. Market fluctuates in more than on time

frame at a time The "main movement", primary movement or

major trend may last from less than a year toseveral years.

The "medium swing", secondary reaction orintermediate reaction may last from ten days

to three months The "short swing" or minor movement varies

with opinion from hours to a month or more

These movements can be bullish or bearish


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Dow Theory

Primary Trend


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Medium Swings and Minor Trends


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Support:

A support level is the price at which buyersare expected to enter the market in

sufficient numbers to take control fromsellers.


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Resistance

A resistance level is the price level at whichsellers are expected to enter the marketin sufficient numbers to take control frombuyers


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Support becomes resistance and viceversa when it got penetrated.


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TRIANGLESSymmetrical Triangle Symmetrical triangles form with lower highs and higher lows.

Because of their shape, they can act as either a continuation ora reversal pattern. This will be signaled by the breakout. Anupward breakout is a bullish signal, while a downward breakout

is bearish.Ascending Triangle

An ascending triangle is formed by equal highs and higher lows.It is a bullish signal, whether encountered in an up- or down-trend. It is most often observed as a continuation pattern in anup-trend but is a strong reversal signal when witnessed in adown-trend.

Descending Triangle Descending triangles form with equal lows and lower highs. A

bearish signal, the pattern is normally observed as a continuationpattern in a down-trend but can be a powerful reversal signalwhen encountered in an up-trend.


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RectangleA pause in the trend during which prices move sideway

between two parallel horizontal lines. The rectangle issometimes referred to as a trading range or a congestionarea. It usually represents just a consolidation period in theexisting trend, and is usually resolved in the direction of themarket trend that preceded its occurrence.


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This is commonly used indicator in TA.Generally 20,50 and 200 simple MAs.

They are used for short, medium andlong term respectively.

MAs can be used as support andresistance level for different time frames


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There are many other indicators whichmay not be discussed like MACD,

Stochastic, H & S etc are also used in TA. While using TA confirmation should be

made by using more than oneindicators. E.g while going for breakoutone should confirm the B/O with volumeanalysis i.e. volume should confirm thetrend.


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THANK YOU

a presentation on technical analysis of stocks_chirag

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