Technical Indicators

Charter 2.0 offers many technical indicators for your research needs. The advanced technical chartist would know what to do with the right away, but most people don’t have a clue. Knowing how to use various technical indicators (or use a combination of a couple for added assurance) would add value to your investment research. You can sharpen your trade timing and get better entry/exit pricing. I spent over a year learning this stuff and I wanted to give back to my readers on what I learned and how you can be a better chartist. Below, I put together resources for every feature available for my program Charter 2.0. Feel free to bookmark it if you can’t go through everything in one sitting.

TECHNICAL INDICATORS:

Commodity Channel Index (CCI)
The CCI, when used in conjunction with other oscillators, can be a valuable tool to identify potential peaks and valleys in the asset’s price, and thus provide investors with reasonable evidence to estimate changes in the direction of price movement of the asset.
Learn More: Commodity Channel Index

Relative Strength Index (RSI)
The RSI compares the magnitude of recent gains to recent losses in an attempt to determine overbought and oversold conditions of an asset.
Learn More: Relative Strength Index

Moving Average Convergenge-Divergence (MACD)
A trend-following momentum indicator that shows the relationship between two moving averages of prices.
Learn More: MACD

Chaikin Money Flow (CMF)
The Chaikin Money Flow oscillator generates bullish signals by indicating that a security is under accumulation. It is based on calculations from the Accumulation/Distribution by Chaikin.
Learn More: Chaikin Money Flow

On Balance Volume (OBV)
A method used in technical analysis to detect momentum, the calculation relates volume to price change. OBV provides a running total of volume and shows if this volume is flowing in or out.
Learn More: On Balance Volume

Accumulation/Distribution (ACC/DST)
ACC/DST measures supply and demand by discovering if investors are generally “Accumulating” (buying) or “Distributing” (Selling) a certain stock by identifying divergences between stock price and volume flow.
Learn More: Accumulation/Distribution

Bollinger Bands (BB Width)
BB Width is the measurement of the width between the top and bottom bollinger lines. When the BB width is small (tight bollingers), then it may indicate and a price expansion will soon occur.
Learn More: B.B. Width, Bollinger Bands

Price Relative To (Price Relative)
The Price Relative compares the performance of one security against that of another.
Learn More: Price Relative

Fast/Full/Slow Stochastics (Stochastics)
Stochastics measures oversold/overbought conditions. When it is above 80, it is in the overbought region and when it is under 20, it is oversold.
Learn More: Stochastics

OVERLAYS:

Moving Averages:
Simple Moving Average (MA or SMA) and Exponential Moving Average (EMA)
SMA is basically the average price for a given period. ie: MA(50) is the average price for the past 50 days (if you are looking at daily ticks).
EMA is like SMA except it weighs the most recent tick heavier in the average price calculation.
Learn More: Moving Averages

Zig-Zag
Its purpose is to filter out random noise and compare relative price movements.
Learn More: Zig-Zag Lines

Price by Volume
The length of each bar on the side is determined by the cumulative total of all volume bars for the periods during which the closing price fell within the vertical range of the histogram bar.
Learn More: Price By Volume

Parabolic SAR
Parabolic SAR sets trailing price stops for long or short positions. It is also referred to as the stop-and-reversal indicator.
Learn More: Parabolic SAR

CHART ANNOTATIONS:

Use the line tool to connect top to top to or bottom to bottom to draw a trend line or price channel. You can even connect a top to a bottom (which should lead to a future bottom) or a bottom to top (which should lead to a future top). Keep in mind that a lower high is almost always bearish except if the stock is consolidating and a higher low is, in the other sense, bullish. Remember that you can make a parallel line to a top trend line or bottom trend line to find the other line to make a channel.

If you want to edit a line or anything annotated on the chart, select the arrow tool on to top of the chart and select a line to edit it. Note that you can also change the line width/color/ or make dashes.

Another useful annotating tool is the Fibonacci retracement tool. You start it at a price bottom and drag it to the next top. Stocks usually retrace back to the 38.2%, 50%, or 61.8% level. If price bounces off the 38.2% level, it is very bullish. At 61.8% it may indicate it is the last time turning up (could mean bearish).

Learn More: Annotating Charts

For your reference, go here to get Charter 2.0. I hope these resources will help you grow as a technical analyst. Enjoy!

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