Section 1 Flashcards
What are Japanese Candlesticks
The visual illustration of the collective knowledge and decision making of all investors during a specific period of time.
They show us the full picture of all info reflected in price action as it is developing right now.
What candlesticks do and don’t tell us
Don’t tell us why price action is happening
Do tell us what is happening in investor sentiment of emotions and decision making.— market psychology indicators
Price action is mainly the result of how well a company is perceived to be preforming versus the real value of the company. Therefore
Investor sentiments are a huge factor in their decision making process. Especially greed and fear.
Candlesticks give the trader the ability to see when the overall ______________ is changing and to quickly act upon that change.
Market sentiment
T or F:With candlesticks one can benefit in only uptrend markets.
F: can be used to benefit in uptrend and downtrend markets.
Line charts only show
Closing price. (Not opening and high and low)
What makes the price of stocks go up and down
S&D -anything else is the effect of s&d, the desire of buying and selling.
Demand is the quantity of a stock REQUESTED in the market. It represents the
Buyers or bulls
The sellers or bears represent
The supply or quantity of stock offered in the market
The yin and yang of the market are the
Bulls and the bears.
As long as the supply can meet the demand the price will go
Higher
In an uptrend prices go up due to
And increase in demand(more buyers)
Or
A decrease in supply (not enough sellers)
Th bulls or buyers are in control during a
An uptrend
When the buyers become sellers it causes more___ which causes_____
Supply
Drop
A downtrend or bear market means
Price is going down due to
an increase of supply, more sellers.
Or
A decrease of demand(less buyers)
The bears or sellers are in control during a
Downtrend
After some time of prices moving up and down, buyers and sellers find _________
An equilibrium so some kind. The maintains the price within a more specific range.
Successful trading is being able to ________________ mindsets of optimism and pessimism depending on the general perception of the market
Shift in and out of
The battle between the bulls and the bears is the equation of
Demand and supply and is what creates the market.
When price moves sideways there is ______________between buyers and sellers
Equal strength
In looking at charts we are looking at the interaction between
Bulls and bears
Support refers to
When strong buying occurs around a specific price level prevent price from dropping even lower.
Buyers are expected to take control over price action…
At the level of support
The logic behind support is
When price drops down to a certain price level, it attracts interested buyers and discourages sellers from selling at a lower price.
