If You Had To Choose Only 3 Technical Analysis Indicators... Technical indicators have been around for as long as I can remember - from initial excitement at my new-found 'discoveries', to becoming a die-hard almost religious advocate, to [eventually] learning a lot of humbling, hard-knock home truths about their limitations. From old favorites like RSI, Stochastics, MACD, Elliott Wave, Fibonacci lines, Gann angles, and candlesticks, to modern day twists on ATR and Chaikin's volatility, it seems traders still get caught up in using the spectrum of fancy indicators, as the sole basis upon which to make trading decisions - especially early on in their learning curve. My own approach is the combination of fundamentals - finding the right stocks to trade based on company growth and value screeners - plus some limited technical analysis on the broader S&P 500 index (purely to improve entry-timing on select stocks and as a timing instrument to hedge long positions when the S&P becomes overbought). If you had to rely only on technical indicators and nothing else, and were given a strict limit of three indicators to choose from, which specific indicators would you depend on? Shiraz Lakhi
1, Price 2, Volume 3, Discretionary lines [Drawing rules derived from personal study, not some book, not some guru]
In your case, Shiraz its an easy call without ANY Indicators whatsoever just get rid of ALL your Fundamental Analysis and go with Price\Volume ONLY. Since you've been using fundamentals to TIME, just applying the above is so huge as to make any indicators relatively worthless when viewed thru' the Law of Diminishing Returns. Of course if you want the whole package, go Price+Vol+Macd, that's it, nothing else
1) Price. Don't need volume since price moving indicates that the volume is there to move it. 2) Indicator that shows a possible oversold or possible continuation of trend. For example, possible trend is ending or that it is going to continue. Yes, I have it and it sometimes works. 3) Indicator that allows me to combine multiple time frames in one chart. Yes, I have it, and it works and also provides clues to trend change.
>>>>>> 1) Price. Don't need volume since price moving indicates that the volume is there to move it. <<<<< FUMES have been doing the job for 4 years now