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The trading based on the actions of price has become very popular in these last years, above all with the trader that they do trading based on technical indicators, like the mobile averages, RSI, ICC, the stochastic thing, and so on. This happens why the technical indicators, all, use the action of the preceding price of the market, or rather the last 21 periods or candles, to calculate the final value and to try to foresee what has happened in the last n-periods, even if this might have somewhat or nothing to that to do with what the market will do in the near 10 periods or candles. In other words, if the market has got, on average, into the last 21 periods, the reading of the indicator can make opening a position long, but this does not mean that the market will keep on going up in the near 10 periods. In order to adopt an approach of action of price in the Forex we need to take in consideration three principal aspects: pressure, level and meaning. There are two types of pressure: the pressure towards the high one and that one I pour the bottom. There is the pressure towards the high one when the bulls take the control of the market after a predominance bear, while there is pressure towards the bottom when the bears take the control of the market after a dominance period bull. Do you try to imagine this “pressure” in head, what does it look like? It might be similar to a model of “v”, in case of pressure towards the high one, or of one “v inverted” in case of pressure towards the bottom. Hypothesising what to the moment there is a dominant position bear, to a someone I point the bulls acquisiscono trust and they take the control of the market, or the bulls feel themselves comforts to be done trading at those levels, pushing the market towards the high one. If we mark the movements with arrows and unite them, it ends up, we will have a model to shape of arrow with direction towards the high one.
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