User Guide and Definitions

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Myles Lucas
8 years ago
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1 User Guide and Definitions Above the Chart Get a Quote Use the search bar to look up a stock or ETF listed on any U.S. stock exchange. Examples: MSFT VXX WMT Yellow Information Bar Just above the chart, there is the Yellow Information Bar. This allows the user to get precise price and volume information for specific dates on the chart. By hovering your mouse over the chart area, the Yellow Information Bar will reveal the date and the open price, high price, low price, close price, and volume for that specific date. On the Chart At the top of the chart, there is a Light Purple Information Bar showing the following information about the stock: Op: The most recent opening price. Hi: Previous trading day s high price. Lo: Previous trading day s low price. Cl: Current price or most recent closing price (if the markets are closed). Volume Here you will find the trading volume for the stock. The number in the purple bar is the most recent trading day s volume. A red bar indicates that there was more selling than buying during the particular time period; a green bar indicates that there was more buying than selling during the particular time period. Unless you are trading penny stocks, which tend to trade in lower volume than other stocks, it is usually wise to trade companies that are averaging at least 400,000 in volume over the most recent 20 days of trading. 1

2 The Tripwire The Tripwire is our initial measure of the stock s momentum. The Tripwire is the first indicator you will examine when determining if the stock is a buy. The Tripwire works like this. A stock Trips when the red line dips into the green area. If the stock s Tripwire is above the green area, we ignore the stock for now. If it is in the green area (or has dipped into the green area during the past 30 days), we will examine the other indicators to determine whether or not the stock is a buy. Here is an example of a stock that has just hit the Tripwire: The Trigger The Trigger is our second measure of the stock s momentum. We look at the Trigger if, and only if, the stock has first Tripped (see The Tripwire). A stock Triggers if the black line crosses the red line. Once a particular stock or ETF hits the Tripwire and the Trigger, it becomes a serious buy consideration. A Trigger remains valid for 10 trading days, after which the momentum of the stock is likely to fade. Here is an example of a stock that has just Triggered: 2

3 With the chart set on the default 1year time period, it is somewhat difficult to determine whether the black line has actually crossed the red line, as we suspect. We can change to a 5day chart in order to confirm that the stock has Triggered. See the chart below: 3

4 Confirmation #1 The Confirmation #1 is our final measure of the stock s momentum. We check Confirmation #1 if the stock has Tripped (see The Tripwire) and Triggered (see The Trigger). This indicator helps confirm our Trigger if the black line is in the green area. If the black line is not in the green area, we don t necessarily rule out the buy signal, but we proceed with caution if we decide to buy the stock. The trades with a valid Tripwire, a Trigger, and a Confirmation are typically the strongest trades with the best likelihood of success. Below the Chart Chart settings reside below the chart. This is where you can change the style, time frame, and other chart settings. A sample is shown here: Period determines the amount and frequency of the data that will be displayed on the chart o The default period is one year with a daily price frequency o You may select any time period you want, or select a custom date range by entering a Start Date and an End Date above. o Here is a list of the period and frequency combinations you may choose under the Period setting: 1d = 1 day, 5 minute 5d = 5 day, 15 minute 1m = 1 month, daily 3m = 3 month, daily 6m = 6 month, daily 1y = 1 year, daily 2y = 2 year, weekly 5y = 5 year, monthly 10y = 10 year, monthly 20y = 20 year, monthly 4

5 Volume determines the visibility of the volume measurement. Bar determines the type of bar used on the price chart. The options include: o OHLC o Area o Line o Candle o HLWCDL Grids On displays or hides the background grids on the chart. Scale Linear scaling will calculate the most intelligent scale using the high, the low and a series of acceptable divisors for possible scales. The Logarithmic Scale uses logarithmic scaling instead of the linear scaling. Events shows stock splits, dividends, and earnings as a "carat", with the legend at the bottom of the chart. Compare To select up to three symbols to compare against. o This will generate a chart with the price data of the symbols overlayed. To produce a chart of percent changes between symbols, turn the % Change setting On. The colors of the boxes (green, purple, red) indicate the color of the line that will be drawn on the chart for the symbol. You may also indicate whether to display that symbol's price scale on the left side of the chart (by default, prices will all display on the right side). % Change displays the stock s price as a percentage change. The start date of the chart always starts at 0%. Add Overlay/Indicator select the indicators you wish to add to the chart. You may add an unlimited number of overlays and/or indicators to a chart. Indicators are added to a new pane underneath the chart, and overlays (Bollinger Bands, Simple, Weighted, Triple and Exponential Moving Averages, etc.) are overlayed on the price chart. The dropdown list groups Overlays at the top of the list, and all other "standalone" studies at the bottom. 5

Simpler Options. Indicator guide. An informative reference for John Carter s commonly used trading indicators. www.simpleroptions.

Simpler Options. Indicator guide. An informative reference for John Carter s commonly used trading indicators. www.simpleroptions. Simpler Options Indicator guide An informative reference for John Carter s commonly used trading indicators At Simpler Options you will see a handful of proprietary indicators on John Carter s charts.