An Introduction to Technical Analysis in the stock market

1. P2
PICKING STOCKS IN THE MARKET
19
The analysis of securities
Made by: Imran Almaleh

2. PART 2
agenda:

Price patterns:
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


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19
ALWAYS AFTER A TREND
Break-out & target rules
The Rectangle
Heads and Shoulders & reversed
Double tops & Double bottoms
Advanced technical analysis
MACD
 CCI
 RSI


3. BREAK-OUT AND TARGET

Break-out rules:
The 3%-5% move
 The volume move


Setting your target:
Measurement
 Sell before you hit your target


4. THE RECTANGLE
4 points formation
 Break-out confirmation
 Target


6. HEADS & SHOULDERS
After a long trend
 Major trend reversal
 Support line
 Reversed H&S

Break-out
 Target


8. Reversed H&S

9. THE DOUBLE TOPS & BOTTOMS

Formation:
1.
2.
3.
Peak then 10 to 20% decline
±3% second peak
Decline
More people selling
 Break-out
 Target


11. H&S

12. INDICATORS

13. MACD
CCI
RSI

14. THE MACD INDICATOR

The concept
Simple momentum indicator

The formula:
MACD: (12-day EMA - 26-day EMA)
Signal Line: 9-day EMA of MACD

Divergence

16. THE CCI INDICATOR

The concept
Extreme moves indicator

The formula:
CCI = (TP - 20-period MA) / (.015 x Mean Deviation)
Typical Price (TP) = (High + Low + Close)/3
Constant = 0.015

Divergence

18. THE RSI INDICATOR
The concept
 Between 30-70
 The formula:

RSI = 100 RS = Average Gain / Average Loss

Divergence