Reading Assignments: Indicators

TA & Algo Trading Course
#221
  1. It is an Oscillating indicator that helps Traders quickly spot increasing short-term momentum.
    2.RSI is a momentum indicator that measures magnitude of price changes to evaluate overbought and oversold conditions to price of a stock.
    3.OBV indicator that measures cumulative buying and selling pressure by the volume on up days and subtracting the volume on down days.
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#222
  1. What is MACD and how is it used?

Moving Average Convergence Divergence (MACD) is an oscillating indicator used to spot increasing short-term momentum.

When the fast moving average (as taken over a shorter time period) crosses above the slow moving average (as taken over a longer time period), a buy signal occurs. Conversely, a sell signal occurs when the fast moving average crosses below the slow moving average.

  1. What is the difference between MACD and RSI?

MACD works better in trending markets while RSI in non-trending markets.

Relative Strength Index (RSI) is a momentum indicator used to measure the magnitude of price changes and mark overbought or oversold conditions.

The RSI ranges from 0 - 100. It is overbought when RSI > 70 and oversold when RSI < 30. When it moves below 50, a buy signal occurs. Conversely, a sell signal occurs when it moves above 50.

  1. What is OBV and how is it used?

On-balance Volume (OBV) is a momentum indicator used to predict price on volume changes.

In a downtrend, a falling OBV follows a falling price. When a rising or flat-lining OBV follows a falling price, a buy signal occurs because the price is near a bottom.

In an uptrend, a rising OBV follows a rising price. When a falling or flat-lining OBV follows a rising price, a sell signal occurs because the price is near a top.

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#223
  1. Moving Average Convergence Divergence (MACD) is one of the oscillating indicators. It’s build with 2 lines (shorter and longer term averages) and histogram. Best used for spotting potential reversals.
  2. Relative Strength Index (RSI) values are between 0 and 100 (always positive) - it indicates well if the price is too high or too low (based on previous periods) but it’s not very good for reversal indication when the trend is strong.
  3. On-Balance Volume (OBV) is an indicator that compresses big amount of information about the volume and presents it as a single line. It’s used to predict the price movement.
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#224
  1. The MACD is the moving average convergence divergence, it’s used to spot increasing short term momentum.
  2. The MACD and RSI (Relative Strength Index) are both momentum indicators, but the RSI measures the magnitude of recent price changes to evaluate overbought or oversold conditions in the price of a stock.
  3. OBV is the On Balance Volume indicator and it measures cumulative buying and selling pressure by adding the volume on “up” days and subtracting volume on “down” days.
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#225
  • What is MACD and how is it used?
    The moving average convergence divergence (MACD) is a kind of oscillating indicator. It varies over time within a band (above and below a centerline; fluctuating above and below zero. It is both a trend-following and volume indicator. If the MACD lines are above zero for a sustained period of time, the security is likely trending upwards. Conversely, if the MACD lines are below zero for a sustained period of time, the trend is likely down. It is also used as a buy and a sell signal. A buy signal when it crosses above the zero line and a sell signal when it crosses below the zero line.
  • What is the difference between MACD and RSI?
    RSI is another oscillating indicator but its movement is contained between zero and 100 so it provides different information than the MACD. One way to interpret the RSI is by viewing the price as "[overbought]—and due for a [correction]—when the indicator in the histogram is above 70, and viewing the price as oversold—and due for a bounce—when the indicator is below 30
  • What is OBV and how is it used?
    On-balance volume (OBV) takes a significant amount of volume information and compiles it into a single one-line indicator. The indicator measures cumulative buying and selling pressure by adding the volume on “up” days and subtracting volume on “down” days. Ideally, the volume should confirm trends. A rising price should be accompanied by a rising OBV; a falling price should be accompanied by a falling OBV. If OBV is rising and the price isn’t, it’s likely that the price will follow the OBV in the future and start rising. If the price is rising and OBV is flat-lining or falling, the price may be near a top. If the price is falling and OBV is flat-lining or rising, the price could be nearing a bottom.
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#226
  1. (MACD) is a kind of oscillating indicator that can help traders quickly spot increasing short-term momentum
  2. (RSI) is a momentum indicator that measures the magnitude of recent price changes to evaluate overbought or oversold conditions in the price of a stock.
  3. The on-balance volume (OBV) indicator measures cumulative buying and selling pressure by adding the volume on “up” days and subtracting volume on down days.
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#227

Moving Average Convergence Divergence, MACD:
-Helps to spot quickly increasing short-term momentum
-2 Lines: fast and slow one
-When lines crosses; entry signal
-Buy case; fast line crosses through and above slow line
-Sell case; fast line through and below slow line
-oscillating indicator, within a band, above and below zero, above zero;like upward trend(buy) and conversely below 0; likely downward trend (sell)

RSI; Relative Strength Index:

  • Measures the magnitudeof recent price changes to evaluate overbought or oversold conditions in the price of a stock
    -Overbought case; when indicator in histogram is above 70, due to a correction
    -Oversold case; when indicator in histogram is below 30 and due to a bounce
    -oscillating indicator, but between 0 and 100

OBV; On Balance Volume
-Measures cumulative buying and selling pressure, by adding the volume on up days and substracting volume on down days

  • the volume should confirm trends
  • rising price=> rising OBV
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#228
  1. What is MACD and how is it used?
    The MACD or Moving average Convergence/Divergence is an indicator. It is used to see where the market is heading. Are we in a Uptrend or downtrend. If the indicator is above 0, we are in a uptrend whereas, if we are below 0 we are in a downtrend.
  2. What is the difference between MACD and RSI?
    RSI or Relative streght index is used to see if we are overbought or oversold. Which indicates the That a reversal might occur soon because of the indicator oversold or overbought is declaring so we need to be aware. The difference between the MACD and the RSI is that they indicate different “strenght/ indicators”
  3. What is OBV and how is it used?
    The On-Balance volume takes the volume information and compiles it into a single one-line indicator. The indicator measures cumulative buying and selling pressure by adding the volume on “up” days and subtracting volume on “down” days. That gives us a clear understanding of the trends.
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#229

  1. What is MACD and how is it used?
    Moving Average Convergence Divergence is an oscillating indicator, varying over time within a band that has a centreline of zero (so it goes above and below zero). The MACD has two lines, a fast and slow. With a histogram on beneath the chart, if the MACD is above zero for a sustained period of time, the stock trend is likely upwards, and if below, it is likely to trend downwards. Using this the buy signals happen when the MACD moves above zero, and sell, when it moves below. You can also use the indicator for buy when the fast line crosses through and above the slow line, and sell when fast crosses through slow and below it.

  2. What is the difference between MACD and RSI?
    MACD indicates the trend going both up and down, it uses a band that has zero as the centreline and two lines (fast and slow), whereas RSI has a oscillation range between 0 and 100 that indicates if the asset is overbought (above 70) or oversold (below 30). MACD gives more information on general trend in the market rather than overbought/oversold.

  3. What is OBV and how is it used?
    On-Balance Volume is a single line indicator measuring cumulative buying and selling pressure. Theoretically, the volume confirms trends with an OBV going up indicating a rising price and OBV going down, indicating a falling price. When they are not in alignment, this can indicate that the price may be near a top or bottom on pricing.

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#230
  1. MACD stands for Moving Average Convergence Divergence and can be used to view overall trend of the market and identify probable pull backs and reversals.
  2. The MACD is overall used to gauge the trend and strength of the market. RSI is overall used to gauge overbought/oversold conditions.
  3. OBV or On Balance Volume measures the volume flow (positive and negative) and is generally used as a momentum indicator to identify divergence in price action.
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#231
  1. What is MACD and how is it used?
    MACD meaning Moving Average Convergence Divergence is an oscillating indicator that gives signals for potential trends reversals. It has 3 components 12 days MA, 26days MA and bars.
    When the market is strong and trading up 12 days MA is above 26 days MA(bullish) and vice versa show bearish market
    2. What is the difference between MACD and RSI?
    RSI( Relative Strength Index) is an oscillator oscillating between zero and 100. Unlike MACD which signals the market trend RSI signals whether an asset is over bought (above 70) or over sold (under 30).
    3. What is OBV and how is it used?
    OBV meaning On Balance Volume it show trends by compiling volume information into a single one-line indicator. The indicator measures cumulative buying and selling pressure by adding the volume on “up” days and subtracting volume on “down” days.
    A rising price should be accompanied by a rising OBV; a falling price should be accompanied by a falling OBV.
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#232

The MACD is a trend-following and momentum indicator with a neutral line. The zero line, which can be used to determine the current trend. Two moving averages in the indicator (the fast and slow line) additionally show possible reversals.

The MACD indicator indicates the overall strength and trend of the market. The RSI indicator gives good overbought or oversold signals

It is a volume indicator. It Uses volume information and compiles it into a single line indicator.

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#233
  1. What is MACD and how is it used?

MACD = moving average convergence divergence.
It is an oscillating trend indicator which varies over time within a band (above and below a zero/centerline). It generates two lines (slow and fast line) which be used to help determine certain trends, momentums and thus buy or sell opportunities.

  1. What is the difference between MACD and RSI?

RSI = Relative Strength Index
It is also an occilating indicator but the band is set between 0 and 100 so it gives you different information. RSI can be used to see whether a prices is overbought (above 70) or oversold (below 30). As a result a strategy could be buying at oversold conditions and selling at overbought conditions.

  1. What is OBV and how is it used?

OBV = On-Balance Volume
It visualizes volume information in one single line by cumalitively measuring selling and buying activities. Adding volume on ‘up’ days and detracting volume on ‘down’ days.
It can be used to confirm whether the market is in a up- or down trend and also indicate if prices are going to rise or go down over the long term.

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#234

  1. What is MACD and how is it used?
    The Moving Average Convergence Divergence, shows the direction of the trend and the strength of this trend. The momentum indicator can also send a buy and sell signal.

  2. What is the difference between MACD and RSI?
    The MACD measures the relationship between two EMA’s, while the RSI measures price change in relation to recent price highs and lows. These two indicators are often used together to provide analysts a more complete technical picture of a market.

  3. What is OBV and how is it used?
    The On Balance Volume is to indicate the flow of strength and volume to reflect buying and selling pressures against the price action.

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#235

  1. MACD shows both trend and momentum. The histogram oscillates above and below the zero line. The main use is the search for crossovers. When a fast line crosses a slow line upwards, it is interpreted as a buy signal. When a fast line crosses a slow line down, it is interpreted as a sell signal.

  2. MACD helps us understand in which direction the trend could go, while RSI gives signals when we could see a potential shift in the trend.

  3. OBV is essentially used to confirm a trend. A rising price should be backed by a growing OBV and vice versa. The volume indicator measures buying and selling pressure. Trends in price should be underlined with a trend in volume - increasing or decreasing to the corresponding circumstances.
    A divergence between the price trend and the OBV trend can be viewed as a buy or sell signal.

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#236

MACD is an oscillating indicator which fluctuates above and below zero. If it is above zero, it is trending upwards and if it is below zero, it is trending downwards.

RSI ranges from zero to one hundred and only uses a single line indicating an overbought or oversold signal. MACD uses two lines and when the line crosses indicates a buy or sell signal.

OBV is a single volume line indicator that measures cumulative buying and selling pressure by adding the volume on up days and subtracting volume on down days.

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#237
  1. MACD (Moving Average Convergence Divergence) can be used to view overall trend of the market and identify probable pull backs and reversals. MACD is comprised of 2 moving avg (fast/slow) and histogram plotted on a 0 neutral scale.
  2. MACD is generally used to gauge the trend and strength of the market. RSI is generally used to gauge overbought/oversold conditions. Although these are not exclusive uses, they are the most common uses for new traders learning these indicators.
  3. OBV (On Balance Volume) measures volume flow (positive/negative) and is generally used as a momentum indicator and identify divergence in price action.
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#238

  1. MACD is an oscillating indicator that varies over time within a band (above or below a centerline) The MACD fluctuates above and below zero. It’s used as a tool to follow trends and shifts in momentum.

  2. MACD is a trend follower and momentum indicator, RSI oscillates between 0-100 and in return provides different information than MACD and can be used as a tool to help confirm market tops and bottoms, based on whether or not the price is viewed as overbought or oversold.

  3. OBV is On-balance Volume, it takes in a significant amount of volume information and compiles it into 1 single line. Measures volume by adding volume on up days and subtracting volume on down days. It can be used to confirm trends. A rising price should be accompanied by a rising OBV

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#239
  1. MACD shows a fluctuating indicator either above zero and below zero. It shows the current trend and momentum.
    2.RSI uses a single indicator and oscillate a signal of overbought or oversold. MACD uses two indicators that oscillate above zero and below zero and when the lines crosses indicate a buy/sell signal.
  2. uses a volume information measuring the cumulative buying and selling pressure.
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#240

1 MACD stands for Moving Average Convergence Divergence and its used for predicting the markets
2 MACD is turning around zero because its focused on trends(up or down) where as RSI is between 0 and 100 and indicates correction or (re)bounce
3 OBV stands for One Balance Volume and its used for meseasuring te cumulative buying/selling pressure

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