Overview A characteristic of a healthy bull market is that it makes higher-highs and higher-lows. This indicates a continual upward shift in expectations and the supply/demand lines. The amount that prices retreat following a higher-high can be measured using a technique referred to as “percent retracement.” This measures the percentage […]

Overview The Overbought/Oversold (“OB/OS”) indicator is a market breadth indicator based on the smoothed difference between advancing and declining issues. Interpretation The OB/OS indicator shows when the stock market is overbought (and a correction is due) and when it is oversold (and a rally is due). Readings above +200 are […]

Overview The Parabolic Time/Price System, developed by Welles Wilder, is used to set trailing price stops and is usually referred to as the “SAR” (stop-and-reversal). This indicator is explained thoroughly in Wilder’s book, New Concepts in Technical Trading Systems. Interpretation The Parabolic SAR provides excellent exit points. You should close […]

Overview The Renko charting method is thought to have acquired its name from “renga” which is the Japanese word for bricks. Renko charts are similar to Three Line Break charts except that in a Renko chart, a line (or “brick” as they’re called) is drawn in the direction of the […]