About the Technical Analysis 101 course category

Technical Analysis 101 course
#24

Hi there, this is indeed the place to ask all questions. Welcome to the course and thank you for reaching out.

In that lesson it wasn’t “mass statistics” I mentioned, it was “having an understanding of maths and statistics”. I say this because as you dig deeper into more advanced technical analysis, it can become a quantitative study of statistical modelling of price action so a good understanding of maths and statistics will help you absorbs those techniques much more easily. But at this stage, in this course, a simple understanding of maths and statistics will help you to be able to calculate percentages when deciding things like stop losses and take profit targets.

I hope that helps.

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#25

Hey really thank you so much for your reply and insigth. I heard wrong then, but I now get what you say, and I think I can handle it. Thanks again

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#26

Dear @Chris_Bailey

I have been all day reading about definition of exchanges and brokers. I think I understand the difference between them. Basically, exchanges are markets where bids and asks are matched, while with brokers you give them your money or “collaterals” and they perform the or a set of transactions on your behalf in one or many different markets. Is that correct?

If this is true, and for example, understanding that Kraken is a cryptocurrency exchange, then every time I buy ETH on my Kraken account, then Kraken matchs my bid with someone´s else Offer, and Kraken will never exchange whatever asset I am offering to buy ETH against their own ETH liquidity, correct?

Thus, any other platform where I can trade my cryptocurrencies / assets against the own platform´s liquidity, can be understood as brokers?

(Note: I know nothing about trading, this is the first step I am taking in the subject, and I know things are not as simple as I mentioned above, but just want to stick on the basics

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#27

@Chris_Bailey last question for today,

I have done my research about bid and asks (or offers), and understood why they are so confusing.

In one hand, Bids represent all of the following:

  1. The highest price buyers are willing to pay for an asset;

  2. Normally the bid price is lower than the ask;

  3. Bids represent the price of selling in the chart; and

  4. The amount of money the seller will receive when selling an asset.

On the hand, Ask or Offers represent all of the following:

  1. The lowest price sellers are willing to receive from selling an asset;

  2. Normally the ask price is higher than the bid;

  3. Asks represent the price of buying in the chart; and

  4. The amount of money the buyer shall pay for the asset.

Please let me know if I am wrong.

Thanks

Carlos Arias Reggeti

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#28

This is a very comprehensive answer. Well done!

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#29

Again, good answer, mostly correct. But brokers don’t always act as a dealing desk.

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#30
  1. A Trading exchange is a market where securities, commodities, derivative’s and other financial instruments are traded.
  2. Brokers act as intermediaries between an investor and a securities exchange.
    Discount brokers execute trades on behalf of a client,
    Full-service brokers provide execution services as well as provide tailored investment advice and
    solutions.
  3. Margin in Trading is the deposit required to open and maintain a leveraged position using products such as stocks and securities.
  4. The Bid price is the highest a buyer will pay for the stock.
    The Ask price is the lowest the seller will accept for the stock, The difference between the two prices is known as The Spread.
  5. Leverage is the use of borrowed funds to increase a traders position well beyond his available funds.
#31

Hi @Chris_Bailey What is the best timeframe to analyse patterns? is it hourly rate or daily?

#32

I think the answer to that question depends on the person, because everyone has a different approach to risk and a different level of experience when making decisions.

If you are a trader, then you’re likely looking more at the shorter term timeframes for example the hourly chart down to the 5-minute chart, you are probably likely looking for volatility and want to trade the minor market fluctations.

If you are an investor, then you’re likely looking more at the longer term timeframes for example the 8-hour, daily, weekly, monthly charts. You are probably not interested in the minor market fluctuations and would rather identify the longer term trend.

#33

I understand that the answer I am looking for is: patterns works well either by a short and a long timeframe. But analyze them depends on the type of person I am to make decisions. Is that correct?

#34

Hi @Chris_Bailey,

Happy New Year! I finished the course just yesterday and I must say I’ve learned a lot and already made a lot of the mistakes you mentioned :stuck_out_tongue: , though those have been great lessons too.

I have a few questions to improve my TA skills:
1- Regarding the 1% rule, is this applicable to Spot trading? From the course, I got the impression you always refer to margin trading. For example, let’s say I have $10k, if I’d do a one trade a day in spot, I’d only be able to trade $100, I guess in spot you could trade $10k but with a stop loss of 1% = $100 and a 3% = $300 of reward, right?

2- I’ve started to use paper trading to test my strategies, what books, courses, websites do you recommend to keep improving on my TA, having the foundation of this course?

Thanks,

#35
  1. What is a trading exchange?
    It is a centralized location that brings corporations and governments so that investors can buy and sell equities.
  2. What do brokers do?
    They manage wealth.They deal with equities and bonds, as well as mutual funds, ETFs and other retail products as well as options for more sophisticated clients.
  3. What is margin trading?
    Margin is not a cost or a fee, but it is a portion of the customer’s account balance that is set aside in order trade.
  4. What is the difference between Bid and Offer (or Bid and Ask)
    Bid and ask prices are market terms representing supply and demand for a stock. The BID represents the highest price someone is willing to pay for a share. The ASK or OFFER is the lowest price someone is willing to sell a share. The difference between bid and ask is called the SPREAD.
  5. What is the leverage?
    Leverage is an investment strategy of using borrowed money—specifically, the use of various financial instruments or borrowed capital to increase the potential return of an investment.

T.A 101 Instructor Chris Bailey : Lets’ say Bitcoin is $9000.00
ME : We wish :smile:: at $40,000.00

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#36

Hi raul782,

1 - The 1% rule applies to spot or derivatives and specifically applies to short-term trading and not investing. But in crypto, 1% is pretty conservative as you’ve demonstrated. Upto 5% could be tolerable depending on your strategy, mentality, experience and trading plan. The basic premise is that you shouldn’t be betting the farm on any trade. You’ll likely be wrong very often, it shouldn’t threaten to dent your bankroll.

2 - Lot of questions there. Let’s keep it simple and cover the core from which everything else can be built. Read John Murphy’s ‘Technical Analysis of the Financial Markets’ and Mark Andrew’s ‘The Handbook of Technical Analysis’. Then read Mark Douglas’s ‘Trading in the Zone’ those three books should stimulate all the ideas you need to answer the rest of your questions.

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#37

Yes you could argue this is the case. I personally approach the markets by using a two timeframe approach, think of it like the oceans.
What direction is the tide flowing? The long-term trend. Trade in that direction
Which direction are the waves breaking? The short-term trend. Trade the waves in the direction of the tide

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#38

Ok I’m pulling my hair out here.
I originally wanted to get into options trading, but after hours of digging it seems there are no platforms to offer this in Europe as I am based in Ireland.
The course is very helpful for analysis and tools but I am still none the wiser about what types of trading are available to me, or even what type of trading is used in the course. I guess day trading? Stop or limit order?

Do I have to enter a target for every trade I make on every platform?
Can I not enter a trade without a set target and raise my stop loss as the trade gains?
In my searches I am only finding platforms (like etoro and 212) that only seem to offer cfd trading, I’m not really sure what that is and it doesn’t seem to be mentioned in the course!?
Do you have to have a separate brokerage account linked to an analysis site? Do FXCM and Gemini not have the same charts and tools available to their users to just sign up with them directly?
How are fees calculated into trades?

Sorry but its just (to me) some of the most basic questions seem to be the hardest ones to find answers to and I’m just finding it hard trying to figure out how and where to get started without understanding these things first.

#39

I am on the Trading View 101 - Trading View - Opening Trades. I clicked on the Orders but instead of trading view showing me the orders it is instead taking me to the trading view webpage and is asking me to open a live account. Anyone know what is happening?