tailieunhanh - Forex Strategies for High and Low Volatility Markets_6

Tham khảo tài liệu 'forex strategies for high and low volatility markets_6', tài chính - ngân hàng, đầu tư chứng khoán phục vụ nhu cầu học tập, nghiên cứu và làm việc hiệu quả | MASTERING THE CURRENCY MARKET the most reliable trade signals is the combination trendline break and stochastic cross. In the last section we talked about what happens when a trend reverses and how the order of operation for the technical indicators plays out. Right at the top of the list was the trendline break and the stochastic cross. The combination of these two occurrences is always noteworthy because a shift in the trend cannot occur without them. Because of the simplicity and reliability of this signal it is one of the first trade signals we will be covering. We see an example of these signals in Figure 9-5 where we have the signals marked by vertical lines that show the candles that gave us the signals. The vertical line on the left side of the Figure 9-5 Combination Stochastic and Trendline Trade Signal 212 TYING THE TECHNICAL INDICATORS TOGETHER chart marks a sell signal given by the combination of the price closing below a short-term up trendline and the stochastic crossing below the oversold line. The vertical line on the right marks a buy signal marked by a close above the bear trendline combined with the stochastic moving higher above the oversold line. The trendline drawn is intermediate-term in length as it is between 15 and 60 candles. Also note how the MACD supports both the sell signal and the buy signal. To take a sell signal we prefer to see that the MACD histogram has stair-stepped lower at least once which tells us that there is a shift in momentum in favor of the signal. For the buy signal on the right side of the chart we see that although MACD is below zero the MACD histogram is stairstepping in the direction of the trigger. When we use the trendline and stochastic cross signal we don t need the MACD histogram for confirmation but we want it to confirm within the next couple of candles. A rule of thumb is that if we are considering a trade signal and the MACD histogram is moving opposite to the signal we know we are very likely to be .