Technical Analysis
MACD ( Moving Average Convergence/ Divergence) - – A popular technical analysis indicator which combines characteristics of a moving average and a momentum indicator.
The most common buy and sell signals generated by the MACD are crossovers. A MACD crosses above the signal line this is seen as a Bullish signal and when the MACD crosses below the signal line this is seen as a Bearish signal. i.e It triggers a sell signal when the blue MACD line crosses down through the red “trigger” line and vice versa.
RSI (Relative Strength Index) - An indicator used in technical analysis to determine the momentum of a security. It is mainly used by traders as a guide to establish when markets are overbought or oversold. Typically a market is described as overbought when the RSI level is above 70 and oversold when below 30
Moving Average
A moving average is an indicator that shows the average price over a period of time. This type of event occurs when a shorter moving average crosses a medium moving average, and the medium moving average crosses a longer moving average. The moving average periods used for this event are 4, 9 and 18 day. When the 4-day crosses above/below the 9-day moving average, the event has "started". The event is "confirmed" when the 9-day moving average crosses above/below the 18-day moving average.
A bullish signal is generated when the direction of the crossovers is above e.g. the shorter crosses above the medium and the medium crosses above the longer. A bearish signal is generated when the direction of the crossovers is below.
When a shorter moving average (of a security's price) crosses a medium moving average, and the medium crosses a longer moving average, a bullish or bearish signal is generated depending on the direction of the crossovers.
Bear - A term describing someone who expects a market to fall commonly referred to as being "bearish." A bear market is not a simple decline but a substantial drop in the prices of a range of issues over a defined period of time.
Bull - A term describing someone who expects a market to rise commonly referred to as being "bullish." Further, a bull market is one that is expected to rise or is already in the process of rising.
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