TRADING INDICATOR NOTES

Moving Averages (MA)

- MA is indicator to that following trend very best. It works great and
effective only on Trending Market.
- MA is Trend Following Indicator and not Momentum Indicator, so it`s no
t good in Sideways.
_ Use 50 and 200 SMA at CLOSE for Daily Forex.
_ Use 10 at CLOSE & 40 at OPEN SMA for Commodity Trading.
_ Use 13 SMA at CLOSE for Weekly Chart (Commodity, Forex & Stock). It al
so used as Auto Trendline.
- Use Auto Trendline with Crossover of 26 SMA at CLOSE (if 13 SMA used),
or doubled value, to detect start of Trending.
- EMA in bollinger used to detect Reversal or pullback.
- Use 8 SMA at CLOSE to identify Elliot Wave.
- MA Compression, is crossover of (5, 10, 15, 20, 30, 40) SMA. It is ver
y Dynamic and often effective too at Triangular Consolidation.
When it crossover and make very tight consolidation (even often it mak
es singel line), it is indicate market are
oversold or overbought to indicate reversal, and very effective after
pullback to indicate continuation of Trend.

MACD
- MACD consists MACD Signal (12, 26), MA Signal (9), and Histogram.
_ Center Line (CL) also called Water Line (WL), There is also Overbouht
(OB) & Oversold (OS) where MACD is on Strees Point (SP) and tend to reverse.
- If MACD and Histogram accross WL and goes UP price usually in/beggin U
P Trend, and Otherwise.
- so when MACD Signal above WL and MA Signal, so it is usually UPTREND,
otherwise.
- MACD Divergence is when MACD make different direction with price. It i
s better than Crossover because used to indicate tend when price got reversal.
- MACD Divergence is better when when time divergence happen, the number
of Crossover is little (ex: 1 to 3 MACD Crossover).
- MACD is not good enough to seight for divergence with price or BB beca
use its slow nature in turn to detect volatility, use %BB.
- MACD Neutralization is where MACD from OB/OS goes toward Trend and th
en break WL and thus goes to OB/OS other SP then goes toward WL against Trend,
at this point is called Neutralization Point (NP) whe
re price tend to break up to continiously following toward the trend. However re
versal is also
often happenened. So use DeMark Trend Analysis & Prejection, ABC Patte
rn Analysis, also combined with reading Indicator & MA Crossover, etc.
- MACD Neutralization is work best on Trending.
- Suggest from AJ (Daily : 5, 34, 5) and (1M : 5, 35, 10).

Bollinger Band
- Bollinger Band self is indicator to detect volatility (Strength and We

akness) in price regardless it is trending or not.

- Squeeze area in BB, indicate price are/will going to consolidation.
_ Upper Band (UB) wider = Up trend, Lower Band (LB) wider = Down Trend.
- If price close inner Band whereas its high is higher than previsious c
anddle, it is technicaly lower (weakness in upptrend move).
- If price close inner Band whereas its low is lower than previsious can
ddle, it is technicaly higher (weakness in downtrend move).
- Bollinger Band self is indicator to detect volatility only and not tre
nd or even price decision. Use Trend Line to do that.
- Band (either Up or Low) goes break the Trend Line (TL) or Channel, it`
s time to search for confirmation to entry market.
- * UPDATE from from MY TRADING EDGE that BB used to attract Price like
Magnet so that it can be used to detect Trend.
- * UPDATE, when UPTREND, UB of BB is pointing up, and so price tend to
touch UB. UPTREND is over when UB goes flat or turn around.
- * UPDATE, when DOWNTREND, LB of BB is pointing down, and so price tend
to touch LB. DOWNTREND is over when LB goes flat or turn around.

%BB (Bollinger Percent B)

to detect
-

Used for confirm volatility on BB.

Used to seight for divergence with price and/or BB because it is good
volatility.
Have the greatest strength in Divergence.

RSI (Relative Strength Index)

- Usually Used as 3rd Indicator for confirmation and/or strengthen other
Indicator (usually used with BB & MACD).
- RSI is used more like %BB, that is not just to detect volatility but a
lso to show that trend begin and over.
- Best settings from MY TRADING EDGE is use RSI in 7 bars.
- With RSI 7, it`ll confirm UPTREND if line grapgh goes >70 and hold for
a time in that position (>70), whereas MACD & BB indicate UPTREND (* read above
).
otherwise it`ll confirm DOWNTREND if line grapgh goes <30 and hold for
a time in that position (<30), whereas MACD & BB indicate DOWNTREND.

STO (Stochastic)
- Best setting used in Fibbonacci Swing Trading (FST) is 9,3,3.