What is Pair Trading? How does it work?
Pair trading involves undertaking a long and short position in stocks that have a high correlation. A relatable example of pair trading can be compared with an interstate highway and service road
Pair trading involves undertaking a long and short position in stocks that have a high correlation. A relatable example of pair trading can be compared with an interstate highway and service road
Fibonacci retracement levels are horizontal lines that indicate the possible support and resistance levels where price could potentially reverse direction.
A gap up and gap down is essentially a change in prices levels between the close and the open of two consecutive days. Here we are referring to two consecutive trading days.
A trendline is a line that connects all the troughs or all the peaks in a stock chart with each other. A trendline that connects the peaks helps you chart the growth that a stock has displayed over a period.
The best way to identify the target price is to identify the support and resistance points. The support and resistance (S&R) are specific price points on a chart expected to attract the maximum amount of either buying or selling.
Only when a trader knows how to “read candlesticks“, he will be able to understand what the patterns tell him about the underlying market dynamics, the behavior of traders, and whether buyers or sellers are in control.
Bullish candlestick patterns may form after a market downtrend, and signal a reversal of price movement. They are an indicator for traders to consider opening a long position to profit from any upward trajectory.
A candlestick is a way of displaying information about an asset’s price movement. Candlestick charts are one of the most popular components of technical analysis, enabling traders to interpret price information quickly and from just a few price bars.
Stock chart pattern are lines and shapes drawn onto price charts in order to help predict forthcoming price actions, such as breakouts and reversals. They are a fundamental technical analysis technique that helps traders use past price actions as a guide for potential future market movements.
Stock charts, like all other charts, have two axis—the vertical axis and the horizontal axis. The horizontal axis represents the historical time periods for which a technical chart has been constructed. The vertical axis displays the stock price or the trading volume corresponding to each period.