The technical analysis trigger known as a death cross occurs when the short-term moving average crosses below the longer-term moving average. This can indicate the beginning of a down-trend.
A Donchian breakout occurs when a stock trades above or below its Donchian Channel. If the stock trades at a price above the channel, a long position is indicated. If the stock trades at a price below the channel, a short position is indicated. A more conservative approach suggests that you should only initiate a trade when the stock closes at a price outside of the channel. An even more conservative approach suggests that you should only initate a trade if the stock closes outside the original channel two days in a row.
The Donchian Channel is calculated by plotting the intraday high for a time period and the intraday low for the same time period.
The technical analysis trigger known as a golden cross occurs when the short-term moving average crosses above the longer-term moving average. This can indicate the beginning of a up-trend.
Pivot Point Levels
As a method of predicting future price levels, pivot point levels attempt to calculate the probability that a stock will trade in a certain range during the next period. The most probable scenario is that the stock will trade between Support Level 1 and Resistance Level 1.
Simple Moving Average
The Simple Moving Average (SMA) is calcuated by adding the closing prices of a stock for a number of trading days and dividing the sum by the number of trading days used. The result is an average closing price for the time period used.
Volume variance is used to determine if a stock was traded with unusually high volume in a given period. It is generally believed that price movements that occur on a trading day with higher than average volume are a better indicator of future price action than price movements that occur on a trading day with lower than average volume. Volume variance is calculated by finding the average volume for a given period and comparing it to the volume on the trading day in question. We convert this variance to a percentage of the average volume. This allows us to screen for the highest volume variance regardless of the average daily volume.