Indicators help traders identify and confirm the market's direction, strength, and volatility. They are especially useful in trending markets because they allow traders to ride the trend rather than predict reversals. How Indicators Are Used: Used for trend confirmation, avoiding…
The Hammer is a single candlestick pattern that appears at the bottom of a downtrend, suggesting a potential reversal to an uptrend. It indicates that although sellers controlled the price initially, buyers stepped in, rejecting lower prices, which could signal…
The line chart is the most basic form of price chart, developed as a simple way to visualize stock trends over time. It plots only the closing prices of a stock and connects them with a continuous line. The closing…
Position trading focuses on long-term market trends, with trades lasting several months to years. The goal is to capture major price movements rather than short-term fluctuations. Key Points: Similar to long-term investing but involves active monitoring and adjustments. Relies on…
A Covered Put is a strategy where you short the underlying (e.g., BANKNIFTY Futures) and sell a put option at a lower strike price to earn premium income. It works best when the underlying price is expected to fall slightly…
A Covered Call is a strategy where you hold the underlying (e.g., NIFTY or BANKNIFTY Futures) and sell a call option at a higher strike price to earn premium income. This strategy works best when the underlying price is expected…
Dow Theory, developed by Charles H. Dow in the late 19th century, serves as the foundation of modern technical analysis. It provides traders with a structured approach to understanding market trends, price movements, and investor behaviour. Though Dow never formally…
The Average Directional Index (ADX) is a trend strength indicator that measures how strong a price trend is, whether upward or downward. Unlike other indicators, ADX does not indicate trend direction, only the strength of the trend. It is typically…
A bull market is when stock prices consistently rise over a long period, driven by strong economic growth and high investor confidence. It creates a positive trading environment where demand is greater than supply. Key Points: Prices trend upward steadily…