Look What TSLA Did In Just Four Hours
There was a massive spike in TSLA… but it wasn't people piling in - it was the machines. The algos responsible for 99% of all price action in the market. If you'd followed along with the computers, you could've made a week's pay in those four hours. The same phenomenon is propelling stocks like GDX and MDT, too. Here's how… | | Three Powerful Technical Tools to Use | In my session the other day, I ran through three technical tools that ought to be in every trader's toolbox. There's simply no better, easier way to keep tabs on momentum and its frequent shifts. They're easy to see and set up on just about every trading platform, and if you're just charting, you can use them everywhere from Stockcharts to Yahoo! Finance. | These are the biggies… | 1. Relative Strength Index (RSI) | Purpose: RSI measures the speed and change of price movements, helping traders identify overbought or oversold conditions. Usage: RSI values range between 0 and 100: Above 70: Indicates overbought conditions, suggesting a potential reversal or pullback. Below 30: Indicates oversold conditions, signaling a potential upward bounce.
Momentum Monitoring: Traders watch for divergences between RSI and price action, which often signal weakening momentum or potential trend reversals.
| 2. Moving Average Convergence Divergence (MACD) | Purpose: MACD highlights the relationship between two moving averages of a security's price, providing insights into momentum and trend strength. Usage: Signal Line Crossovers: When the MACD line crosses above the signal line, it suggests bullish momentum. Conversely, a crossover below the signal line indicates bearish momentum. Zero Line Crossover: A move above or below the zero line confirms trend direction.
Momentum Monitoring: MACD histograms show the difference between the MACD line and the signal line. Increasing bars suggest growing momentum, while shrinking bars indicate slowing momentum.
| 3. Money Flow Index (MFI) | Purpose: The MFI combines price and volume data to measure buying and selling pressure, acting as a volume-weighted RSI. Usage: Above 80: Indicates strong buying pressure, potentially overbought. Below 20: Indicates strong selling pressure, potentially oversold.
Sentiment Analysis: MFI divergence with price movements signals potential sentiment shifts. For example, price increasing while MFI decreases may indicate weakening buying pressure.
| There you are. Three indispensable tools you can start using as soon as the market opens up again on Monday. | Professor Bierman |
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