Intraday trading technical analysis
Intraday trading: historical notes
Intraday trading was born in the wake of the 1987 market crash: the Securities and Exchange Commission instructed NASDAQ to change the rules to protect small investors. The system obliged market makers to automatically execute requests of individual investors, instead of delaying or ignoring them.
Why do we need intraday bidding technical analysis?
Many come to the need for this analysis after observing the markets.
Profitability and the ability to secure a comfortable existence, hidden from many because of disbelief in the effectiveness of technical analysis, will justify the most daring expectations.
Technical analysis for intraday bidding: general
Intraday bidding technical analysis is a study of market dynamics of a day, most often through graphs, to predict the future price behavior. It is based on 3 postulates:
1 Market considers everything.
2 Price movement is subject to trends.
3 Story repeats itself.
There are many technical approaches, as, for instance, intraday trading chart analysis. The highest degree of emergency feedback is provided by intraday bidding.
Best technical analysis for intraday trading
One of the most performant tools for measuring price impulses is Oscillator 3/10, which is drawn on the balance between ten-period exponential and three-period exponential sliding.
The oscillator 3/10 can be modeled using MACD, setting parameters in the way: fast EMA by 3, MACD SMA by 1, and slow EMA by 10.
This is a quick and effective tool, but this tool is not infallible.
COT or Control Point System
Forecasts based on impulse analysis can be more practical if the levels that act as “price targets” (control points) in interpreting the activity of the 1st bidding day are predetermined.
The COT price level acts as a potential support/resistance zone for one day.
These levels help to establish the time, when intraday trends will fluctuate, and also serve as “test points” for forecasts of future market behavior.
Dynamic Support and Resistance
Effective intraday bidding also requires the establishment of support/resistance levels that are fairly easy to adapt and more accurately represent price activity, when market conditions change. With a 20-period exponential moving (20EMA),you can form more dynamic support/resistance levels.
Highs and Lows of the eve
The highs and lows of the eve are extreme points of price values, they can act as support/resistance levels during the 1st bidding day. Price dynamics around these levels may carry valuable information regarding the future market situation.
There is no need to evaluate a separate technical tool as a way to lose or win. The same tool can be flourishing, and the other only losses. All technicalmeans simply assist in trade, and they need to be selected based on the style of trade and the chosen tactics.