Swinging - with momentum

Article Abstract:

Investors can obtain clues about the possible future performance of stocks by studying the speed at which stock prices change. The relative strength indicator (RSI) is a concept developed by Welles Wilder and refers to a 14-day momentum oscillator including a smoothing factor. Other time periods may be useful according to the investor's trading horizons. This tool can help investors avoid purchasing stocks close to a peak, or selling stocks when the price is bottoming out.

Securities and Commodity Exchanges, Security and commodity exchanges, Securities Exchanges, Usage, Exchanges, Graphic methods

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Reliable and exhilarating

Article Abstract:

Stock price changes can be expressed graphically, and patterns may emerge such as the flag pattern which signals that a trend is continuing. Stock prices exhibit strong advances which can be seen as a flagpole or perpendicular line. When the advance stops, there may be a time of consolidation, which looks like a flag on the chart. This may be followed by another strong price rise. Flags may also be evident in downtrends prior to a continued collapse.

Investment advice, Investment Advisory Services, Investment advisers

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Follow the curve to find your answer

Article Abstract:

The relative strength ratio is calculated by dividing the share price by the main index, and is plotted underneath the share price curve. A declining trend in the relative strength ratio indicates that shares are underperforming and a rising trend indicates good underlying support for shares. Divergences between the share price and relative strength ratio are often found, although it is the trend that is most important on the relative.

Portfolio Management, Personal Financial Mgmt, Personal finance

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