We recommend reading this chapter on Varsity to learn more and understand the concepts in-depth.
Key takeaways from this chapter
- Indicators are independent trading systems developed and introduced by successful traders.
- Indicators are leading or lagging. Leading indicators signal the possible occurrence of an event. Lagging indicators, on the other hand, confirms an ongoing trend.
- RSI is a momentum oscillator that oscillates between 0 and 100 levels.
- A value between 0 and 30 is considered oversold. Hence the trader should look at buying opportunities.
- A value between 70 and 100 is considered overbought. Hence the trader should look at selling opportunities.
- If the RSI value is fixed in a region for a prolonged period, it indicates excess momentum. Hence, the trader can consider initiating a trade in the same direction instead of taking a reversed position.
- A MACD is a trend following system.
- MACD consists of a 12 Day, 26 days EMA.
- MACD line is 12d EMA – 26d EMA.
- The signal line is the nine days SMA of the MACD line.
- A crossover strategy can be applied between the MACD Line and the signal line.
- The Bollinger band captures the volatility. It has a 20-day average, a +2 SD, and a -2 SD.
- One can short when the current price is at +2SD, expecting that the price reverts to the average.
- One can go long when the current price is at -2SD, expecting the price to revert to the average.
- BB works well in a sideways market. The BB’s envelope expands in a trending market and generates many false signals.
- Indicators are good to know, but they should not be treated as a single decision-making source.
Good job guys ….but the key takeaways could be longer ….now it’s masked by the next video thumbnail.
Working on it, Sony.
I would really appreciate your great work with quality content.
Glad to know you liked the content. Happy learning 🙂
This is awesome! The video quality, interactive video edits, camera angles, and ofcourse the content quality is just too good!
How a broker turns into a value generation machine can be absolutely learned from Zerodha. Other brokers need some marketing lessons from you all!
Thanks for the kind words, Ninad. Glad you liked the content on Varsity 🙂
It would be better if certification exams can be given on web also. As of not only mobile app supports that.
Noted 🙂
On which platform he is teaching these charts? Kindly tell the name of the website
All teaching is on the Varsity platform itself.
Sir, I meant which website is being used for these charts? Tradingview.com, investing.com or is it Zerodha only? Sorry about the repeated questions.
Some of these screenshots were taken on Pi. But you can use Kite for charting, which houses both Trading view and ChartIQ.
Great Stuff!
Happy learning!
What is the correct time frame to check an RSI indicator?
I’d suggest EOD chart.
unable to see EMA or Exponential Moving Average on Chart
I’d suggest you call the support desk for this, they will help you.
1- Hi sir , EMA crossover is purely price based indicator system itself, and you said most of the time that we can also take trade based on EMA crossover system solely, even if candlestick pattern is not there. But in grand checklist first step is only about checking recognisable candlestick pattern and all other indicators like EMA etc are in last step, so how can we take trade based on EMA system, please tell me which of them are more reliable and preferable , should we give preference to checklist first or to other that based on EMA system.
2- if already crossover happens and its almost some days since EMA crossover has happened ,can we take trade after that if i found trend is going on still, or should i wait for some CS pattern in on going trend to get sense. Also what should be the entry and exit in EMA crossover system, should it be just at crossover happens. please clear both points above. i have completed all technicals module also EMA part.
1) Neeraj, the EMA system is outside the candlestick pattern preview. Use it as a stand-alone system if you wish.
2) Its best to take the trade closer to the crossover date. The further you go, the higher the change of the trend diminishing and stock returning to sideways movement.
One more query —
Also you commented as below-
” Karthik Rangappa says:
November 27, 2014 at 5:20 am
From what I can see from the chart, clearly the trade is in favor of a long position. This is because the MA cross over has already happened and it seems like a trend is being formed. I would wait for a retracement on low volumes to enter a position. Ofcoure, the other checklist items should also comply.”
query is — what do you mean by retracement on low volumes, also why this retracement on low volumes not in high volumes.
It just means the stock is correcting, and the volumes are less during this correction period.
ok thanks , so you means that EMA crossover is the only indicator that we can use independently or solely to take the entry and exit, there is not necessary that CS pattern will be there , if CS pattern is there at crossover then conviction will be strong we can say right, otherwise we can seperately use EMA for trade and CS pattern system is different from this . right?
Absolutely. You can set up trades just based on EMA cross-over. But then, you can also combine EMA + CS pattern for better conviction 🙂
Another query is —
there is stockedge website in which various scanners are there base on CS and others, can i use and take help of these CS patterns scanners for recognize CS pattern and others. if manually its getting difficult to search CS pattern daily
I’ve personally not used stockedge, but sure, if it helps you analyse better, then why not 🙂
ok so you dont use stockedge, but i want to ask that is it good to use scanner for cs pattern or for any other bullish and bearish signal , and instead of stockedge can you suggest me that other scanner website for that scans, somewhere you suggest https://zerodha.com/expert-advisors/ this site but i didnt understand how to use this for scanners.
Also can we use scanners instead of doing manually in opportunity universe.
Of course, you can. Use these tools to enhance your odds of finding good CS patterns. Once these are suggested, don’t forget to visually double-check before taking the trade.
ok sir got it thnx a lot
Sir If I have just a thought, example like in nifty 50 ,Any stock like ITC and HDFC any other that we are about to know and confident by FA that we can invest in that type of stock for long term like 10-15 years, because they are fundamentally strong. So if i think that i dont want to invest in that stock, As i only want to trade this type of stock,
So as a trading prospective view, i have taken a trade on delivery like in ITC or SBI etc stock and by TA i am bullish on that, if i dont want to put stoploss to book a loss and if trend gets opposite and somehow trade goes wrong and stock falls down and i didnot put the stoploss, “As i thought i dont want to put SL because if even trade goes in opposite direction, but at some time i think it will move up because it is fundamentally strong and after sometime it will give positive gain ,no matter if it will take more time.”
this thought makes me to avoid loss booking if i hold longer than i decided if trade goes wrong. can you please enlighten this thought that what is this exactly in my thought. Please explain.
Neeraj, SL has to be there in some way, either fundamentally driven or technically driven. If you have a take a trading decision, try to understand why you have that position and the maximum loss you are willing to take. There is no point holding on to the position beyond your risk appetite.
sir in stock BHEL and INDUSIND BANK, in dated 1-2 sept 2022 recent 7-8 days back there is dark cloud cover pattern forming and prior trend is uptrend, then also after pattern forming stock is moving up instead of going down or downtrand, could you please check both the stock in date of 1-2 september .
Neeraj, so these patterns only enhance the odds of you getting profitable, there are no guarantee in the market.
i think in BHEL dated 1-2 sept m saying dark cloud cover but i think day before this it was bullish engulfing, i am not aware of attach screenshot,can you check both stock please manually of that date.
You can attach on google drive and share the link. But not required in this case.
Fabulous,! Every single video is so enriching. The content and presentation is beyond imagination.
Great work.
Thank you very much.
Happy learning 🙂
Sir below is your comment-
1) You can swing trade with futures also, this gives you leverage, but you need to have deeper pockets to suffice for M2M issues.
In pt no 1 – what is the meaning of suffice for M2M issues.
M2M means mark to market.
One more query sir i have one laptop only and i can manage one more extra monitor for trade but if i want to use tradingview in zerodha platform then it popup in new window and i also want to use chart IQ in zerodha for scanners so i have to change the settings from tradingview to chart IQ again and again for any stock ,by which it will be difficult to manage and hectic by making these changes ,
i want to use chart IQ for scans and tradingview for TA both in zerodha but want to use in simple one screen, because it will be difficult that if first i use chartiq for scans and then for TA tradingview, and how to analyze other stocks like this if i want to use TA in 10-15 stocks daily and mark the drawings then how to make list and save ,
overall means is how to make it simple setup for TA
One more query sir i have one laptop only and i can manage one more extra monitor for trade but if i want to use tradingview in zerodha platform then it popup in new window and i also want to use chart IQ in zerodha for scanners so i have to change the settings from tradingview to chart IQ again and again for any stock ,by which it will be difficult to manage and hectic by making these changes ,
i want to use chart IQ for scans and tradingview for TA both in zerodha but want to use in simple one screen, because it will be difficult that if first i use chartiq for scans and then for TA tradingview, and how to analyze other stocks like this if i want to use TA in 10-15 stocks daily and mark the drawings then how to make list and save ,
overall means is how to make it simple setup for TA
Backtest will come on TV soon. Just indicator and timeframe can be saved as a template. Drawings – need to be saved as layout, which can be loaded later, the maximum limit is 100. Also by scanner you mean back test right?
I mean to say i want to use TV for TA and Chart iq for CA pattern scanners in zerodha at same page at same time, it is difficult to first select chart iq for scans (only for cs patterns and bullish and bearish pattern) and then change it for TV for TA at same time ,so how can i setup this so that it will become simple at same time for tech analysis
Got it. So you can use only one chart profile at a time. Let me check internally and get back.
yes, like i want to use kite platform for technicals because its all free of cost TV, but challenging is that i want to use TV and Chart IQ at same time because i want to use scans as well which is not in TV version , it is in CHART IQ which i have to select first, so i think its getting some complicated while using both TV and CHART IQ differently, that is first i have to select chart IQ for scanns and observe, than i have to select TV type for technicals.
As i dont want to use CHART IQ (beta)for TA i use it just only for scans , i prefer TV version for Technals and indicaters, so that is some typical to use both at same time and save my technicals , please check and let me know is there any option for make this simple, if not then please suggest me that how can i manage this accordingly, because its getting hotch potch and confusing little bit if using both simultaneously.
Yes, but the charting option is on selection basis. You cant use both in parallel.
I select “chart” from my watchlist, for a particular scrip. However, I am not getting the same view as shown in the video. I see the chart, but not the top left symbols for indicator, etc.
sir why we use indicators ;it is necessary for what
Indicators are mini trading systems that generate a buy or sell signal. You can use these indicators as an additional tool to validate a trade that you wish to take.
In zerodha kite app i did not find Chandelier exit and pullback indicator. Can anyone help me to get this in zerodha or any other indicator which is already been there as equivalent to this please tell us at the earliest possible.. Thank you…
I’d suggest you check both ChartIQ and Tradingview for this, Santosh.
I WOULD LIKE TO KNOW IF THE MEDIAN PRICE INDICATOR WORKS ON THE KITE PLATFORM? IF YES MAY I KNOW ITS BEST PARAMETERS AND HOW IT CAN BE USED.
I LOOK FORWARD FOR AN EARLY REPLY.
Not sure, Shridhar. I”ve never used this indicator.
this course help lot … quality video … guys thank you lot
Happy learning!
Can you change the alignment of the logo and next video hyperlink. Key take away screen is all hidden due to that in all videos
Noted, Mohit.
Currently, indicators features aren’t being shown in charts on kite. How can i look on them.
Which indicator, Umesh. I’d suggest you speak to the support team on this.
sir which app should i use to analyze these indicator.
You can use Kite, Sachin.
Hi,
Could someone explain how Trend Intensity Index is calculated on kite platform? I want to build a trading logic based on that in my algo.
Mohit, you can check either ChartIQ and Tradingview documentation to figure the exact formulas used in any particular indicator.
Was trying to learn technical analysis since last 2 years , but everytime I started reading modules , I left them in between, these amazing videos helped me complete it finally
Glad you liked the video. Happy learning 🙂
Very useful sir how can we contact you to learn sir
Via this platform itself, Rohit.
This is very much useful for the beginners who wants to learn the stock market basics.
Thanks Zerodha and Karthik Rangappa.
Glad you found the content useful. Happy learning 🙂
Great platform for beginners who are gonna start from basics.
Happy learning:)
Thank you sir best knowledge
Gld you liked the content. Happy learning 🙂
Please post in sequence according to the varsity chapters in modules and some times some topics are not taught in the vedios such as Bollinger bonds in this vedio
Sorry, not sure what you mean by sequence. Can you kindly elaborate?
I have a question about RSI:
A trade happens only when a bid and a offer is matched; or in other words, when a buyer meets seller. This means, count of bids and offers executed in a timeframe has to be equal. Then how does a stock get overbought or oversold?
Overbought or sold occurs when the buying or selling is usually high compared to regular trading activity,
i am not able to found comparative rsi (relative strength comparison indicator).plz help
Please call the support desk for this, Meenakshi. Thanks.
Good Evening Sir
How would i check volumes with candlestick charts, when i see last 10 days average and compare with current day, some time showing negative data. should i compare today volume data with last trading day or last 10 days average.
You can drop a simple moving average line on volume bar, Suresh. That should suffice.
Can we please have a video on price action? or if its available, link please.
Check this Faisal – lots of videos here https://www.youtube.com/@varsitybyzerodha
Where to get supplementary notes for other indicators. If possible pin the link.
I am new on Kite. What are the various information available on Kite for the use of a short term trader and where (how) they can be found?
The useful features are all bundled inside Kite itself. Is there anything in particular you are looking for?
RSI strength,, buy and sell signal how we will get in Zerodha
You can load the indicator from either TV or ChartIQ.
Superb and very nicely explain all the concepts Really appreciating your efforts.
Heads off to all the Zerodha Team and i think they all are well deserve to know our feedback against the hard work they delivering here.
Thanks a Lot… Keep it up… Excellent Job Zerodha Team !!!
Thanks for the kind words, Arogya. Happy learning 🙂
Thank you Zerodha Varsity for providing such a quality content for free to students like us.
Thank you and happy learning, Gaytri!