Technical Indicator can used as a supportive tool. Trading based on technical indicators not recommended.
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@viki19 Videos on MA, RSI & Fibonacci are available in EQSIS You tube channel. Please go through the same. I would like to give my answers for those questions.
1) Moving average is the most common and familiar trend-following. They smooth a data series and make it easier to spot trends. The two most popular types of moving averages are the Simple Moving Average (SMA) and the Exponential Moving Average (EMA). The moving averages work better in trending market but not in trading markets (Sideways).
2) Relative Strength Index (RSI) is part of a class of indicators called momentum oscillators. It is a non-trending indicator. RSI works well in the trading markets (Sideways). RSI gives the overbought and over sold conditions.
In RSI scale, the chart goes below 30 mark, it indicates the weakness and when it goes above 70 marks it indicates strength.
When the indication goes below 30 mark and return, it shows the stock is oversold and buyers are coming into picture. Here is the point we can buy the stock. i.e. in oversold zone.
3) The Fibonacci sequence is the series of numbers: 0, 1, 1, 2, 3, 5, 8, 13, 21, 34 …………..
The next number is found by adding up the two numbers before it. In Mathematics and in arts, ratio is considered Golden, if ratio of the sum of two quantities to the larger quantity is equal to the ratio of the larger quantity to the smaller quantity. There are two quantities say A and B, where A is larger than B.
If (A+B)/A= A/B then answer is Golden Ratio which is 1.6180339887…
This Golden ratio is observed, if you take ratio of any two successive Fibonacci numbers. It comes very close to 1.618034.
4) It’s based on the numbers identified in Fibonacci sequence to define area of support and resistance. It is created by taking two extreme points (usually a major peak and trough) on a price chart and then dividing the vertical distance by key Fibonacci ratios of 23.6%, 38.2%, 50%, 61.8% and 100%. Once these levels are identified, horizontal lines are drawn to indicate areas of support or resistance at the key Fibonacci levels before prices continue to move in the original direction.
@ssureshi sir, Thanks for the detailed information
@ssureshi, Thanks much