Introduction to Technical Analysis
One of the three pillars of Market Analysis is Technical Analysis (TA).
For appropriate financial instruments, (e.g. Swing Trading, momentum trading etc.), the overall design includes an extensive suite of TA tools, including collections of indicators and oscillators.
The design of CyberTrade includes a Technical Analysis (TA) engine that interprets price & volume data, to identify 'areas of interest' for trading.
The TA engine uses Fibonacci ratios to anticipate market retracement and Fibonacci extensions to help predict potential price targets.
TA operates across several time-frames (e.g. weekly) to enable the platform to identify important levels of support and resistance, over time.
TA uses Indicators and Oscillators including moving averages, MACD, Stochastic and Bollinger bands to help identify trade entry and exit points.
TA identifies trading channels by identifying upper and lower trend lines. Channels are used to buy at channel support and sell at channel resistance.
TA utilises identifies common chart patterns (e.g. double tops/bottoms) to help define trading activity and increase the chances of making profitable trades.
Algorithmic passive Trading
CyberTrade - Technical Analysis
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Technical indicators & Oscillators.
The CyberTrade platform is designed to use a range of indicators and oscillators. For example moving average indicators to indicate and anticipate market direction. The Bollinger Band indicator good at adding 'outer lines' to identify entry and exit points.
The MACD oscillator measures the strength of the convergence/divergence between moving averages and identify ies bullish/bearish behaviour. The Stochastic oscillator is used in range-bound markets to help identify entry and exit points.
Chart Patterns in Crypto Trading.
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The CyberTrade design includes a wide range of common chart patters. These include; Double tops & bottoms, head & shoulders, wedges & flags, triangles & pennants.
The platform combines chart patterns with Fibonacci to identify retracement opportunities. It also combines chart patterns with Fibonacci extensions to identify potential price targets.
Putting it all together.
The CyberTrade service has been designed to utilise scalable computational power, sufficient to rapidly evaluate all aspects of Technical analysis ( Indicators , Oscillators, Chart Patterns etc,) quickly.
Trading decisions are arrived at when the analysis predicts likely price movement, with a relatively high probability of trading success.
For example a trading decision to 'short', can be the result of combination of a rising wedge pattern, combined with a downward moving average crossover / negative MACD oscillator and Fibonacci extension prediction.
Furthermore, dynamic Technical Analysis combinations are required in order to cope with changing market conditions.
Technical Analysis - Price trends & History
Technical Analysis works because price moves in short, medium and long term trends. The next price point is more likely to be the continuation of a trend than an erratic new price point.
Technical Analysis works because price movements have a repetitive nature (e.g. Elliot waves). This is often attributed to market psychology which tends to be predictable based on human emotions of fear and excitement.
