Price Action and Patterns

The EUR/USD is trading flat this morning despite a series of news events beating expectations. First EUR German Industrial Production numbers printed better than expected at .8% (MoM) (APR). This was then followed by EUR Euro-Zone Household Consumption printing higher at .6%. However, despite these numbers, the EUR/USD is poised to close the day inside of yesterday’s high and low, with the formation of an inside bar.

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As prices consolidate, EUR/USD traders should keep their eyes open for a breakout to determine the markets chosen direction. Bullish breakouts may begin at yesterday’s high at 1.13927 as a point of resistance. Alternatively, yesterday’s low at 1.13253 may be seen as a value of support. A breakout below this value may suggest further declines of fresh downward momentum.

Traders looking for breakout confirmation may track momentum using the Grid Sight Index (GSI). Once price has moved through either of the technical values mentioned above, traders may use Grid Sight to track historical distributions of price. After a bullish breakout of resistance, we should be seeing an increase in the percentages of historical bullish distributions. Alternatively, if a bearish breakout occurs, there should be an increased bias for historical downward distributions.

False Breakouts

The Grid Sight Index can also be used to help pinpoint if a market breakout has been invalidated. In the instance that prices breakout higher, traders should be warry of the EUR/USD declining back through previous resistance (now support). In this scenario, we should again to begin seeing an increase in bearish historical distributions. Alternatively if prices breakout lower, a heavy weight of bullish distributions may suggest a turn in price back inside of today’s trading range.

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The AUD/USD continues to consolidate today, after moving to new weekly lows late in Wednesdays trading. The weekly low for the AUD/USD currently resides at .7452, and this value comprises a key point of support for an ongoing trading range. Resistance has been noted in the graph below as the last swing high for July 19, found at a price of .757. As prices continue to range traders should continue to track short-term momentum, coupled with support and resistance, to pinpoint any future breakouts in price.

AUD/USD, 1 Hour Chart

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Alternatively, traders may look for a retracement in price if price begin to turn back towards range support. The Grid Sight Index found prices declined 9 pips in 48% of the reviewed historical matches. A move through the first bearish distribution, found at .7496, would open the pair for further declines. It should be noted that prices only fell 33 pips, in only 3% of historical instances. This places today’s final bearish distribution at a price of .7472.


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GBP/JPY started September with the right foot, as for the fourth consecutive trading day, the cross has traded concisely to the upside. Performance that has lead GBP/JPY to account for an increase of 3.4% this week. On a monthly basis, GBP/JPY closed August with a 0.34%, the smallest percentage change the cross had not seen in 5 years.
Next, we are going to review some Short-term and Long-term technical outlooks in order to gain perspective what the future might hold for GBP/JPY.

Short-Term Technical Outlook:

In a short-term technical outlook, we can observe in the chart below that during the last 15 days, trading took place within the confined limits of the upsloping Andrew’s pitchfork. During this time, the 50 SMA crossed above the 200 SMA creating one of the simplest bullish signals in technical analysis, the “Golden Cross”. After this event, GBP/JPY gained great upside momentum and as for the first trading day of September, the cross got to break above resistance line of the above mentioned Andrew’s Pitchfork. As for today, price action maintained on the bullish side and for second consecutive day, the cross broke above resistance line. The cross found a strong resistance level at the extension line established by the slope on our Andrew’s Pitchfork channel placed at yesterday’s high.

However, seems that bullish momentum might be in its way to take a break, as of right now, price action and our 13 period RSI have started to show a negative divergence for GBP/JPY. Therefore, Trader’s attention should now be on those previous resistance levels delimited by our Andrew’s pitchfork channel, as now these will work as support levels for GBP/JPY.

GBP/JPY 1 Hour Chart:

Attachment 23028

Bigger Picture:

On a bigger picture, GBP/JPY finally step over overbought territory on our 13 period RSI. RSI for GBP/JPY had kept on registering lower highs during the entire year as can be observed in our chart below. However, during this week’s trading action, the cross finally got to break the negative sloped line for RSI and as well reach overbought levels. This event could imply that the cross might be changing its bias and now it might be time to start thinking on GBP/JPY with a bullish perspective. Nonetheless, we should remain cautious, as we have to remember that overbought zones represent zones of potential reversal.

As a potential first target for GBP/JPY on this bullish bias, the previous support line that was broken to the downside during the Brexit referendum should be on the mind of traders. As a second target, the 23.6% Fibonacci retracement from the June’s 2015 high and the 2016 July’s low should be in focus.

GBP/JPY Daily Chart:

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Gold prices remain in a holding pattern, with the open of Mondays trading marking the 6th session of consolidation for the commodity. Key daily resistance for the price of Gold remains above $1,265.34, while support is found near $1,241.27. Traders will be looking for Gold prices to breakout this week with the release of several high importance news events. This includes US CPI data released on Tuesday with an expectations set at 1.5% (YoY) (Sep), and Australian Employment Change data released on Wednesday with expectations of +15.0K (Sep).

Gold Price 1 Day, Support & Resistance

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The bearish move in Crude Oil prices this week has been short lived, with the commodity now trading back to weekly highs at $45.29. This move has been predicated on the hope that OPEC will agree to cut production later in the week. This morning’s advance should be seen as significant as it is the first sign of a meaningful reversal after Crude Oil Prices have declined as much as $9.73 a barrel from the October high of $51.91.

Technically, Crude Oil prices are now trading back above the 200 day MVA (simple moving average). Typically this indicator is used as a trend qualifier, and if Crude remains above the MVA it may be seen as a bullish signal for the market. It should be noted that the last time that Crude Oil prices traded above the MVA was in August, which saw the commodity advance as much as $12.68 a barrel. Even though that prices are now trending higher, traders should continue to monitor the MVA at $43.95. A move in Crude Oil prices back under the MVA could just as easily signal shift towards bearish market conditions.

Crude Oil Price, Daily with 200 MVA

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Gold prices are trading flat this morning, ahead of today’s US ISM Manufacturing data. This is considered the first high importance US Dollar event for 2017 trading, and expectations are set for a release of 53.8. Any deviations from this value may directly affect the US Dollar, and the price of Gold.

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Technically, Gold is considered in a long term downtrend as prices broke remain beneath its 200 day SMA (simple moving average) at $1,268.57. In the short term, the commodity is showing a bullish bounce off of December’s low of $1,126.85. This current bounce in price has placed Gold price back above the 10 day EMA (exponential moving average), which is currently acting as support on the daily chart below at $1,145.26.


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After declining last week from yearly highs, Gold prices are beginning to rebound ahead of tomorrow’s FOMC rate decision. Expectations for the event are set to see key rates held at 0.75%, and it should be noted that no press conference is schedule this cycle for Fed Chair Janet Yellen. Despite markets expecting little in the way of policy changes, traders should be reminded that this event can still drastically increase volatility for US Dollar based assets such as gold prices.

Technically, gold prices are rebounding and trading back above its 10 day EMA (exponential moving average), which is providing short term support at $1,199.85. This bullish resurgence in price, suggests that last week’s dip to $1,184.45 was simply a retracement in a developing uptrend. If gold prices continue to rally, traders will next target the standing 2017 high at $1,220.25. Alternatively, if the commodity stalls near present levels, a breakout under $1,180.65 may suggest a resumption of golds ongoing long term downtrend.

Gold Price Daily Chart & Averages

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The AUD/USD is trading into key values of support, as the pair has fallen as much as 199 pips from the standing yearly high at .7741. This decline has come mostly on the back of recent US Dollar strength, and now the market is waiting for Fed Chair Janet Yell to make her most recent statements in Chicago later today.

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Technically the AUD/USD is trending lower in the short term, trading well below its 10 day EMA (exponential moving average), found at .7634. This short term decline in price has now pushed the pair to test the 200 Day MVA (Simple Moving Average), found at .7546. This line should be considered as a critical line of support, and a breakout below this point may suggest a shift in the AUD/USD’s long term trend. If prices fail to breakout however, it may suggest that this most recent decline has been a retracement in an ongoing 2017 uptrend.

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Gold prices have gained considerable bullish momentum this week after finding support above $1,200.00. This rise has been heavily influenced by the outcome of Wednesday’s FOMC event, and now traders are looking at today’s U. of Michigan Confidence survey data for further direction. Expectations for today’s release are set at 97. As a high importance event, it is expected to increase volatility in US Dollar based markets which includes commodities such as Gold.

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Technically gold prices are now trading higher in the short term, after bouncing back about the displayed 10 day EMA (exponential moving average) earlier in the week. This line is found at $1,218.69, and is currently acting as a value of support for gold. If prices continue to rally, traders will look for the commodity to again approach standing 2017 highs near $1,264.06. If prices fail to break through this point, it may suggest that gold prices are simply retracing before trading back in the direction of the metals longer term trend.

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‘The trend is your friend’

We’ve all heard it, and it makes perfectly logical sense; but in practice, this advice is so opaque that it’s practically worthless. Because even if you’re on the ‘right’ side of whatever trend is showing at the moment, the timing and entry into that setup is likely what’s going to determine one’s success or failure on that individual trade. So, it’s not enough to just find the direction of the trend and then ‘hope’ that we’re right; we also have to find support (or resistance for down-trends), we need to be patient and exercise discipline while waiting for the setup to build, and then we have to identify risk levels so that if/when we’re ‘wrong’, we have a line in the sand with which to bail in order to save the rest of our equity. In this article, we’re going to share a five-step process for traders looking to trade into new or ‘fresh’ trends using price action.

Know Your Time Frames

New traders often wonder ‘which time frame is ‘best’’? This is very similar to asking ‘what is the best temperature’. Well, it’s relative. Some like it colder, others like it warmer; but by and large most people are in the same ballpark range of comfort. Chart time frames work like this, as well. If you’re a scalper looking to hold positions no longer than 20 or 30 minutes, the setup on the monthly or weekly chart is probably going to be so divorced from the dynamics that you’re following that you might as well be looking at another market altogether. And if you’re trading a monthly setup, what’s taking place on the one or three minute chart is probably going to be pretty inconsequential to your ‘big picture’ setup.

There is no ‘best’ time frame. Time frames are merely different looks at the same picture; with the shorter or tighter time frames offering a more granular, detailed look at near-term price action. The downside to this greater detail is noise; as those shorter time frames are, in general, considerably noisier than longer-term charts. But the longer-term charts are significantly slower and not nearly as actionable; so the prerogative here should be one of balance.

Trader 'Style'	~ Holding Period	Trend Chart	Entry Chart
Long-Term	1 Week +	Weekly	Daily
Swing-Trader	few days - few weeks	Daily	4 hour
Short-Term	few hours - few days	4 hour	1 hour
Day-Trader/Scalper	< few hours	1 hour	15 minute

Don’t Chase the Breakout

The period that is often most dangerous to trade a new move is also when it happens to be the most attractive, and that’s when prices are breaking out of previous support or resistance. Breakouts can be difficult to trade, even for experienced traders, because by nature it’s the process of something ‘new’ happening and thereby there’s no recent data or observations from which we might be able to derive strategy.

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Wait for Support to Show-Up Around Prior Resistance (for up-trends)

Watching a fresh breakout can be trying for a trader’s patience, and for the new trader that can be a challenging exercise as their only real option whilst watching a breakout take place is to either chase it, or fade it (go short after a bullish breakout). Given that a breakout is, by definition, a ‘new’ observation of higher or lower prices, this is an inopportune time to open positions.

Use the Shorter Time Frame to Confirm Support & Early Stage of Directional Move

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Once the breakout has been found, and once the pullback has gotten under-way, traders can begin to plot their trend-side entries. This is where the greater detail and granularity of that shorter-term chart can be helpful from the additional perspective that’s provided.

Setting Risk and Bailing When Proper

After the trade has been identified, traders are going to want to add a stop as they trigger or shortly after they open the position. That way, if matters reverse, the trader has some element of down-side protection. But key here is one of expectations: Price action is rarely perfect, and perhaps more to the point, price action swings are blatantly obvious and most market makers can visibly see where prices had previously reversed. Most market makers also know these points are often used for stop or limit placement, so these price action swings can be like a red beacon for ‘free liquidity’ for market makers executing on sitting orders.

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Low volatility is a major source of frustration among many traders as the amount of opportunity to trade – or should I say, make ‘good’ trades – diminishes. Frustration generally only breeds one thing – more frustration. We can’t control how the market behaves just as we can’t control the outcome of our trades, but what we can control is how we react and conduct ourselves.

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Volatility ebbs from low to high and back again, across all time-frames. In that statement lies the silver lining; when volatility is low, look at it like this – it will pick back up again (and maybe soon). But until it does we need to accept what the market is providing. It is imperative to lower expectations so as to protect both trading and mental capital (always want to keep your head as clear as possible). To combat uneasiness which can arise by the lack of opportunity, be mindful and think – For every loss I avoid, it’s one less loss I have to make back when volatility or optimal trading conditions return…” And, again, volatility will return.

We examined (again) the simple concept of using a checklist, whether it be a physical one (i.e. spreadsheet) or a mental one (which seasoned traders are likely to use). A checklist includes various criteria such as risk management parameters and criteria needed for a trade set-up. Like volatility, your trading activity and performance won’t be evenly distributed; there will be times where set-ups appear frequently and other times when they don’t.

https://www.youtube.com/watch?v=wrr6_cAcmYA

When the market is ‘dull’ there are things we can do to still be productive; study trade history/review journal entries, read books/websites, listen to and read what seasoned traders have to say, and even – relax! You have to trust that a good trade or better environment is around the corner. So, at the end of the day, if a proper mentality is adopted, one not need to become frustrated.

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Triangles/Wedges

These types of patterns develop as a result of contracting volatility which portend price expansion upon breakout. There are three types – symmetrical, ascending, and descending.
Symmetrical triangles are the most neutral of the three variations as higher lows and lower highs converge towards the apex of the formation. If they develop early in a trend they tend to act more as an indication of pending continuation of the trend prior to development, however; if they form after extended moves they are more prone to leading to reversals. In any event, as is the case with any one of the three variations, a confirmed breakout is needed before the pattern is set into motion, because these, especially, can go either way.
Ascending wedges are marked by higher lows and a flat top. They show that market participants are willing to step in at increasingly higher prices despite the market capped by resistance. While this indicates a bullish bias in an upwardly trending market, if they break to the downside then a top can form. Conversely if development comes after an extended downtrend and break to the top-side they can result in a bottom.
Descending wedges are marked by lower highs and a flat bottom. With this variation the market is indicating that sellers are coming in at lower and lower levels with increasing pressure on horizontal support. A break of the bottom of the formation in-line with the downward trend is a continuation-style pattern. If they form after an extended up-move, we see a break of the flat bottom, then they are topping in nature.

https://a.c-dn.net/b/40eD2H/Becoming..._Picture_2.png


Bull & Bear-flags

Bull-flags develop after a rally and occur as a result of gradual selling, but nothing significant enough to change the trend (also known as a ‘correction’). The downward channel which takes shape is eventually triggered by the market trading above the top-side trend-line. The extent of the move which the pattern projects is for a new swing-high to develop at the least, and the measured move target is the depth of the pattern added to the point of breakout.
Bear-flags develop after a sell-off and occur as a result of gradual buying, but not enough to change the bearish trend (aka, ‘correction’). The upwardly sloped channel is eventually triggered by a move below the lower trend-line which makes up the underside of the pattern. In reverse of the bull-flag, a move to a new swing-low is targeted, with the ‘MMT’ determined by the depth of the formation subtracted from the breakout point.

https://a.c-dn.net/b/1cHnKQ/Becoming..._Picture_5.png

Continuation-style ‘Head-and-shoulders’

While traditionally head-and-shoulders are thought of as reversal patterns (which we discussed in Part I), they can form in the direction of a trend and act as continuation patterns. These can also take on the shape of an ascending wedge in an uptrend and a descending wedge in a downtrend. In any event, the implications are the same. The measured move target is the distance from the head to the neckline added or subtracted from the neckline depending on whether it is a bullish or bearish sequence. Again, other technical levels should be taken into consideration when determining targets.
https://a.c-dn.net/b/4oS9rP/Becoming..._Picture_6.png


Rectangles (consolidations)

This is a very simple pattern, which until either side of the range (or consolidation) is broken is to be avoided. Trading in the middle of the range isn’t prudent. These are often considered continuation patterns, but if they develop after an extended trend and break in the opposite direction, they can mark a top. As is the case with all technical patterns, the size of the pattern determines the measured move target once a breakout occurs.
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What is RSI (Relative Strength Index)?

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RSI (Relative Strength Index) is counted among trading's most popular indicators. This is for good reason, because as a member of the oscillator family, RSI can help us determine the trend, time entries, and more.
The Relative Strength Index (RSI) was developed by J. Welles Wilder to measure the speed and change of price movements. RSI oscillates and is bound between zero and 100. There are many different uses for RSI and by far the most popular is trading overbought and oversold crossovers.

Think beyond the crossovers

When traders first learn about RSI and other oscillators, they tend to gravitate to overbought and oversold values. While these are intuitive points to enter in the market on retracements, this can be counterproductive in strong trending environments. RSI is considered a momentum oscillator, and this means extended trends can keep RSI overbought or oversold for long periods of time.

Watch the center line

All oscillators have a center line and more often than not, they become a forgotten backdrop compared to the indicator itself. RSI is no different, with a center line found in the middle of the range at a reading of 50.
Technical forex traders use the centerline to show shifts in the trend. If RSI is above 50, momentum is considered up and traders can look for opportunities to buy the market. A drop below 50 would indicate the development of a new bearish market trend.

Check your parameters

RSI like many other oscillators is defaulted to a 14 period setting. This means the indicator looks back 14 bars on whatever graph you may be viewing, to create its reading. Even though 14 is the defaulted setting that may not make it the best setting for your trading. Normally short-term traders use a smaller period, such as a nine period RSI, to replicate shorter term movements in the market.. Longer-term traders may opt for a higher period, such as a 25 period RSI, for another indicator line.

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FX markets are susceptible to a range of factors which affect their volatility, and many traders look to tailor their strategies to capitalize on the most volatile currency pairs.

Volatility, usually measured using the standard deviation or variance of a currency, gives traders an expectation of how much a currency can deviate from its current price over a certain period. The higher the volatility of the currency, the higher the risk. Volatility and risk are usually used as interchangeable terms.
Different currency pairs have different volatilities. The major currency pairs like the EUR/USD, USD/JPY, GBP/USD and USD/CHF generally have less volatility than the emerging market currency pairs like the USD/ZAR, USD/KRW and USD/BRL. Normally, more liquid currency pairs have less volatility.

What are the most volatile currency pairs?

Top 10 Most volatile currency pairs
Among the major currency pairs, the AUD/JPY, NZD/JPY and AUD/USD are currently the most volatile.
https://a.c-dn.net/b/228zPj/most-vol...pairsgraph.png

The USD/ZAR, USD/KRW, USD/BRL and other emerging market currencies pairs tend to be highly volatile due to their low liquidity and because of the risk that is inherent in emerging market economies.

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Reversing is a type of martingale. Such systems suggest lot doubling after a losing trade, so that profit could cover previous trade's losses in case of success.

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Stock market volatility is an integral concept for traders to understand. Knowing the stocks with the highest potential for significant price movement, as well as how to trade them optimally, can mean exciting opportunities. In this piece, we explore high volatility stocks in more depth, look at how to identify the most volatile stocks, and provide best practice tips for trading them.

What is volatility in stocks?

Stock market volatility refers to the range of price movement of a stock over time. A more volatile trade has the potential for significant gains, but also substantial losses. Volatility in stocks can be understood using the following measures:
1) Standard deviation
Standard deviation is the average amount the price of a stock has differed from the mean over a given period. Bollinger bands can be used by chartists to analyze standard deviation.
2) Beta

A stock’s Beta is a measure of its volatility in relation to the wider market. The market has a beta of 1.0, with more volatile stocks having a value greater than this (eg 2.0), and less risky stocks having a value closer to zero.

The chart below shows the price for the ATA Inc. stock (ATAI), listed among the most volatile by TradingView as of April 2019, with both the standard deviation and Beta measures of volatility included on the chart.

https://a.c-dn.net/b/1IRakQ/stock-ma..._797834456.png

What are the most volatile stocks?

When it comes to volatility and stocks, there is no one set of stocks that are always more volatile than another. Stocks can be classed as ‘currently volatile’, describing those stocks with current high swings, or ‘expected to be volatile’, meaning stocks that may be stable at this moment but have potential for high volatility in the future.

As can be seen in the above example, stocks can have periods of high volatility, for example showing a Beta near zero, then an increasing Beta to 2.0, and then falling back to near zero months later.

Identifying high volatility stocks

When identifying high volatility stocks, traders can use a stock screener, search the derivatives market, and use third party websites.

Stock Screener/Filter
A stock screener or stock filter is an automated program that reveals a list of stocks that fit certain criteria.
For example, using a stock screener to monitor the stocks that had the biggest percentage gains or losses in a prior trading session, making sure each has enough volume per day, can be helpful to ascertain subsequent volatility. Helpful criteria to find volatile stocks may include ‘show stocks where the average day range (50) is above 4%’

Searching the derivatives market
Traders can use parameters in the corresponding derivatives market such as put call ratio, which is a tool to gauge market sentiment, open interest, the number of contracts outstanding on an exchange at any one time, and implied volatility, a market forecast of likely price movement. For these indicators, it is advisable to go to the official exchange website.

How to trade stock market volatility

Trading stock market volatility successfully involves effective hedging, knowing when to sell stocks, employing sound risk management, and spotting buying opportunities when renowned stocks see a fall in price.

Hedging
Hedging against spikes in volatility is important to offset losses. This can be done by buying put options, which allow the sale of assets at an agreed price on or before a particular date, and trading inverse exchange-traded funds, which act as the inverse of the index or benchmark it tracks. Traders can also explore aggregated stocks through an index to protect against volatility (see below).

Selling stock/managing risk
If extreme volatility is affecting your mindset, it may be wise to sell off some stock and put your money into less dynamic securities. This leaves you free to trade another day without risking more than you are prepared to lose.
Practising sound risk management is essential when dealing with aggressive price action. Volatile stocks can lose you a lot of money and should not be traded if your mindset isn’t right that day, particularly if day trading.

Spotting buying opportunities
Sometimes a buying opportunity arises when high volatility hits the price of high-quality stocks. For example, in early 2019 the NASDAQ and S&P 500 constituent Apple cut its earnings forecast, leading to its price dropping 10-15% in the following days. However, just three months later, it completely recovered and approached a $1 trillion valuation once more. Identifying opportunities to go long when the market conditions reverse is one way traders look to speculate when coupled with prudent trade management techniques.

Volatile stocks for day trading
Like the most volatile currency pairs, volatile stocks can show significant movement throughout the day, making them potentially an attractive option for day traders. While some stocks may move 0.5% in a single day, others may move as far as 5% in the same period, meaning traders should be constantly alert.
To find a volatile stock for day trading, watch a stock you found with your stock screener for intraday movement. If a stock opens down 10% and starts moving, as opposed to staying static, it is being day traded and may be worth consideration.
Due to the speed of price movement, executing day trades can be a physical endeavour and good reflexes win the day.

Volatile Stocks for Swing Trading
Swing traders hold positions for more than a day, making the effects of volatility potentially smaller than when day trading. Stocks that may be suitable for swing trading include large cap stocks such as Apple, Facebook and Microsoft, because they have a large volume of shares changing hands at any given point.

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What is Exponential Moving Average (EMA)?

The exponential moving average (EMA) is a derivative of the simple moving average (SMA) technical indicator. Compared to the SMA, the EMA weighs recent price changes more heavily than later changes in price. This means that the EMA is more responsive than the SMA to current price fluctuations.
The chart below represents the difference between the SMA and EMA. The 200-EMA is seen reacting earlier to the highlighted decline in price on the left side of the chart. The same is seen with an increase in price emphasizing the variance in lag.

How is the Exponential Moving Average (EMA) Calculated?

Nearly all charting packages perform this calculation on the respective platforms and apply the calculation to the chart. For the numbers people, the formula will be shared below, but the important thing to remember is that EMA will react quicker to price trends relative to SMA.
The exponential moving average (EMA) is a weighted moving average calculated by taking the average price for a particular market over a defined period of time and adjusting this figure to increase the weight of recent price data. The formula below breaks down the components of the calculation making it easy to visualize and compute.
https://a.c-dn.net/b/0c0GMx/exponent...emaformula.png
How do you use the Exponential Moving Average in your trading strategy?

The EMA trading strategy can be used in the same manner as the SMA. When the shorter term EMA crosses above the longer term EMA, this signals a buy signal. When the shorter term EMA crosses below the longer term EMA, traders look to enter short positions. The EMA values are completely up to the trader’s preferences. The example below uses 20, 50 and 200 EMA designations, while other traders favour Fibonacci figures.

Exponential Moving Average: A Summary

The EMA is valuable indicator to have as a trader. This indicator is simple to use and a great way for novice traders to get a feel for technical analysis in relation to identifying trends and entry prospects. More experienced traders tend to use the EMA in conjunction with other tools, but this makes it no less influential.
Steps to follow when trading with the EMA:

• Use long-term EMA to identify general trend
• Identify crossing points between shorter term EMA’s and longer term EMA’s
• Look to enter ‘long’ or ‘short’ positions accordingly

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What is Price Action?

Price action is the study or analysis of price movement in the market. Traders use price action to form opinions and base decisions on trends, key price levels and suitable risk management. Trend identification is frequently utilized as the initial step in price action trading. All other facets to price action indicators require a trend basis to begin price action analysis.

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Price Action as Your First Indicator

Technical analysis setups generally begin with price action as the initial form of evaluation. The first thing to remember when using an indicator is that it is a function of price action. The indicator itself is not the ultimate tool when it comes to trading, but rather comes in behind price action. Price action governs the information that the indicator will ultimately provide on the chart. As such, a trader must determine what price action is doing (i.e. the trend) before consulting the indicator for an entry signal. Once the trend is determined, the trader can then consult the indicator for an entry signal in the direction of the trend.Traders trade on the price movement of an instrument therefore, the focus is on the change in price as opposed to the change in indicator value. Some traders base trading decisions and analysis purely on price action whilst other prefer a combination of price action and technical indicators which serve as a support system.

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Technical indicators are derivatives of price action - price action governs the information that indicators provide on the chart. These indicators are calculated using varying periodic price data which provide substantiation for entry, exit, and stop distance criteria. Trend identification is also important in market analysis to ascertain how the market is functioning on a holistic scale (time frame dependent).

Price Action and Technical Indicators: A Summary

Price action is a broad technical analysis technique that incorporates various trading strategies which traders apply to analyze the markets. Technical indicators work well in conjunction with price action to allow traders to formulate more accurate trade decisions.

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Morning Star - indicator for MetaTrader 5

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This indicator is showing the ' Morning Star ' pattern on the chart.
The indicator has several settings, which allows it to be used both for the Forex market and for exchange symbols: ' Gap ', ' Candle 2 type ' and ' Candle sizes '.

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Gold prices turn to US CPI data in the week ahead as elevated global bond yields continue to make a tough road ahead for XAU/USD. Fed Chair Jerome Powell commentary eyed.

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Here is a stock scan for the coming week and the holiday season.

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Data prints coming out of the US may keep the price of gold afloat as the Fed’s preferred gauge for inflation is expected to increase for the fifth consecutive month.

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The improvement in risk appetite may keep the S&P 500 index afloat over the coming days as the Federal Reserve appears to be in no rush to winddown its balance sheet.

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The latest Office for National Statistics (ONS) inflation release showed headline inflation hitting 6.2% in February, a fresh 30-year high, while core inflation rose to 5.2% from 4.4% in January. And even higher levels of inflation are expected in Q2 this year. The latest BoE monetary policy release shows that the UK central bank expect headline inflation to top 8% in the coming months, citing sky high energy and food prices as the main drivers of the move.

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The asset management division suffered due to net losses in equity investments and lower lending and debt investments revenues: Goldman Sachs’ stock (NYSE: GS) has lost roughly 19% YTD as compared to the 16% drop in the S&P500 index over the same period.

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Weekly price was on bearish breakdown by crossing Ichimoku cloud to below for the primary bearish reversal. The price was stopped by 304 and 302 support levels which is located near and below Ichimoku cloud. If the price crosses those levels to below so the primary bearish trend will be continuing, if not so the secondary ranging to be near and inside Ichimoku cloud will be started.

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Attachment 45750

Xpeng stock (NYSE: XPEV) published its Q1 2022 results on Tuesday, reporting a narrower than expected loss, although guidance for Q2 fell short of estimates.
The daily price is ranging below 200 SMA in the bearish area of the chart within 55 SMA at 25.14 resistance level and 19.90/18.01 support level waiting for the direction of the bearish trend to be resumed or the bear market rally to be started.

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The Japanese Yen was hammered by markets in the second quarter. USD/JPY shot by the 2002 peak, touching its highest since 1998. A key driver of the Yen’s weakness has been the Bank of Japan’s policy divergence from its major peers.

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A look at the Tesla stock split to determine how it might change the value of the 6th largest company in the world. Amazon, Google and Shopify also had stock splits in 2022.

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The Dollar Index enjoyed a stellar week as US data saw further increases in peak rate expectations. Can the momentum continue?
The H4 intra-day price is located far above 200 SMA in the bullish area of the chart. The price is trying to break resistance at 105.27 for the primary bullish trend to be continuing.

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Attachment 47001

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Candlesticks are a very helpful technical tool if we use them correctly, as we can find a potential movement based on their patterns. Candlesticks can form specific patterns on the chart and these patterns can be divided into two types single-candle patterns and blended candle patterns (more than one candle). In this article, we will learn how we can use MQL5 to detect some of these patterns automatically in the MetaTrader 5 trading terminal, we will cover that through the following topics:

• Single candle patterns
• Dual candles patterns
• Three candles patterns
• Conclusion

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In this article we will create the zone recovery martingale forex trading strategy expert advisor (EA) in MetaQuotes Language 5 (MQL5) for MetaTrader 5 (MT5) step by step. The zone recovery martingale strategy is a common strategy that is oriented to counter loosing positions by opening opposite positions with a slightly greater trading volume that cancels the losing positions. It is basically a trend following strategy that does not care about the direction of the market, with the hope that at one point, the market will be trending either downwards or upwards and eventually particular targets will be hit.

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Even though trend movements only have two sides, uptrend and downtrend, sometimes there is a flat side where prices tend to stagnate as if there is almost no movement. Price action is usually combined with candle patterns to predict support and resistance based on price history.

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In the previous article, we have laid the foundation for easy usage of the results obtained from optimization to build a ready-made EA with multiple instances of trading strategies working together. Now we do not have to manually enter the parameters of all used instances in the code or in the EA inputs. We only need to save the initialization string in a certain format to a file, or insert it as text into the source code so that the EA can use it.

So far, the initialization string has been generated manually. Now, finally, the time has come to start implementing the automatic formation of the EA initialization string based on the obtained optimization results. Most probably, we will not have a fully automated solution within the scope of this article, but at least we are going to make significant progress in the intended direction.

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Throughout the entire series, we addressed the topic of risk control several times. The concepts of a normalized trading strategy were introduced, the parameters of which ensure that a drawdown level of 10% is achieved during the test period. However, normalizing trading strategy instances, as well as groups of trading strategies, in this way can only provide a given drawdown over a historical period. We cannot be sure that the specified drawdown level will be observed when starting a test of a normalized group of strategies on the forward period, or launching it on a trading account.

Recently, the topic of risk management was considered in the articles Risk manager for manual trading and Risk manager for algorithmic trading. In these articles, the author proposed a programmatic implementation that controls the compliance of various trading parameters with pre-set indicators. For example, if the set loss level for a day, week or month is exceeded, trading is suspended.

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