As a matter of fact, there are so many indicators that can be used to make a buy or sell decision. I would like to only use the most effective and simple indicators:
1. Simple Moving Average (SMA) - using 20 & 50 days
Buy signal: price is above 20 SMA and the 20 SMA crosses over above the 50 SMA.
Sell signal: price is below 20 SMA and moving downwards to the 50 SMA.
2. Moving Average Convergence Divergence (MACD)
MACD can give meaningful feedback only as trends change, and the MACD is less useful if the market is not trending. Zero crossovers provide evidence of a change in the direction of a trend.
When the lines and histogram cross up, this is a simple buy signal.
When the lines and histogram cross down, this is a simple sell signal.
3. Trading Volume + Volume (MA)
Only consider buy a counter which is reasonably actively traded with the support of healthy trading volume.
If the uptrend of a stock price were supported by an increasing trading volume indicate the price have a strong support.
Extra caution is needed if the trading volume is high with a downward stock price movement.
The indicator generally works well in trending markets, but not a good indicator during non-trending, sideways phases.
The price rises above the green dots is generally bullish sign,
while if the price is below the red dots is generally bearish sign.
5. Relative Strength Index (RSI)
The Relative Strength Index Technical Indicator (RSI) is a price-following oscillator that ranges between 0 and 100.
RSI > 80 overbought - sell signal
RSI >60 probably bull - buy signal
RSI < 20 oversold - buy signal
Traditionally, RSI readings greater than the 80 level are considered to be in overbought territory.
RSI readings lower than the 20 level are considered to be in oversold territory.
In between the 20 and 80 level is considered neutral, with the 50 level a sign of no trend.
All in one chart:
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