We use the AAPL (Apple computers) stock to observe the difference between 20 period, 30 period, 50 period and then 200 period. We observe how the moving average can be used as a signal to determine if the stock is in an uptrend or not.⠀
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Whipsaw = occurs when a buy or sell signal is reversed in a short time. Volatile markets and sensitive indicators can cause whipsaws.⠀
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*information provided from stockharts.com*
We use Moving Averages to help smooth out the price. Part 1 of this series, helps explain what 1 period (or 1 day) vs. 65 periods (or 65 days) which is a quarter of a year looks like. Common periods to look at is 20 days, which resembles the one month.
Candlestick charts can help you identify the open and the close of charts from one day to the next. Hollow candlesticks means the close was higher than the open and above the prior day. On the bigger screen, the more hollow candlesticks you see uprising, the better.⠀
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Screen shot this text below to help you remember the difference in colour coding 👇🏻⠀
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Hollow Black: Closed higher than the open and above prior day⠀
Solid Black: Closed lower than the open and above prior day⠀
Hollow Red – Closed above the open and lower than the previous day⠀
Solid Red – Closed below the open and lower than the previous day
Bar charts help us to see the closing of one day, to the opening of the next day. As well as the highest and lowest trading of the day, or time period you select. This helps to see the intraday price action, vs. just the closing price like a line chart shows.
