There is only two trading regimes:
2. Trending up/down.
It is vital to your success that you try to identify wich regime you are in. And you use different indicators in trending and sideway regimes. Parabolic SAR is useless in flat regimse, but good in trending. Stochastics, MACD etc. are better in flat than in trending regimes. These indicators may lie in the overbought / oversold region all the time in a trending regime.
Moving averages is good in trending regimes. An exponential moving average is faster than a simple. Use crossovers as buy and sell signals.
ADX (DMI+ and DMI-) was made to identify trends.
Bollinger Bands is good to use. Buy Bollingers Book and learn to identify the different movements within Bollinger Bands.
- Tagging the bands in trending regimes.
- Break Outs.
If you combine Bollinger Bands with accelleration bands (Bigtrends.com), you may be able to identify take offs.
Look at the stock at different frequencies. If you have the same signal at daily data as at weekly, that is a strong singal.
Be ware of Multicolinerity. MACD, Stochastics and RSI gives the "same" message. There is another indicator that is not so well knowm, the Precision Profit Float indicator by Steve Woods. He claims that this is the third dimension of a stock quote in addition to volume and price.
1. Learn to identify the regime of a stock.
2. Use the right indicators in that regime.
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