Moving averages are used in most of the indicators used in forex markets.
For example; bollinger bands, MACD, and ichimoku.
The moving average is a display that is calculated by taking the average of prices. Moving averages are accepted as an important indicator in terms of trend follow up. The reason for this is that the moving averages consist of past price movements. Moving averages also assist in determining support and resistance points.
For example; The 200-day moving average is heavier than the 20-day moving average and indicates a more delayed forecast. Short-term moving averages are used by short-term traders and long-term moving averages are used by long-term investors.
The 200-day moving average, which is often used by investors, is closely monitored as a significant signal and support resistance level. In some cases, moving averages with more than one time interval are used together to obtain an opinion on the direction of the market
Two types of moving averages are frequently used in Forex markets.
Weighted Moving Average: Moving average of a financial product, calculated by taking the average of the price movements within the determined period according to the determined weights.
Exponential Moving Average: Moving average of a financial product, calculated by taking the average of the price movements in the determined period and giving more weight to the price movements in the near term. Since weighting is performed, the exponential moving average is counted as a moving average with less delay.
As the time spent in moving averages increases, the delay is more frequent.
For example; Looking at the 10-day moving average, the delay is less because it takes into account the more recent prices.
Moving averages, which are common in technical analysis, are more effective when used together.
For example; The 50-day moving average and the 200-day moving average produce interlaced technical analysis signals. Generally, the combination of the short-term moving average and the long-term moving average gives better results. The upward-sloping short-term moving average long-term moving average is signaling that prices may move upwards in the short-term. In the literature this “golden cross” is known as “golden cross”. On the contrary, if the short-term moving average cuts down the long-term moving average, it generates a signal that prices can move downward. This “death cross” in the literature is referred to as “dead cross”.
The only variable in the analysis methods mentioned above is not the price. The time variable should also be examined extensively. In this context, Fibonacci Sequences can be used in price changes as well as in time intervals. When time intervals are set, the figures in the Fibonacci Series are bases in days, that is, they are divided into trend day intervals of 1-1-2-3-5-8-13-21-34. This analysis is used to determine the duration of the fluctuations.
Why is Fibonacci Series called Fibonacci Series?
The Fibonacci series was found by Leonardo Fibonacci. Leonardo Fibonacci, born in Italy, discovers these numbers when he searches for a problem and decides to give his name.
Why is Fibonacci Series so Important?
Fibonacci Series As we have mentioned in the title, the numbers
in the series are divided by the number of the previous number and the number of the gold is approached within the objects of
our lives and these numbers are important a nd mysterious. The golden ratio found in the Fibonacci Series is found in ancient Egyptians. The Greeks, like the Egyptians, used this number in architecture. To put it simply,
The geometric orbital between the parts that make up the whole.
If we try to explain Fibonacci Sequence with examples from our daily life,
The ratio of our index finger to the previous node is the golden ratio.
The rate of gold we can reach with the Fibonacci series also arises from the proportion of sensory organs in the human face.
For example, the area of our ears, from under the nose to the jaw, contains the golden ratio.
In Egyptian pyramids, the ratio of the base to the height gives the golden ratio.
USE OF FIBONACCIR DESIGN IN THE FINANCE SECTOR
FIBONACCI CORRECTION LEVELS (RETRACEMENT)
E.G / Let’s consider a parity that has seen the lowest price of 1.0520 and the highest price of 1.1376 on the basis of time.
When we subtract the high price from the low price, 1,1376 – 1,0520 = 0,0856. If we hit this value with 1.272 above, it will be 0.0856 * 0.232 = 0.0198. When we add this value to the high price of 1.1376, it will be 1.1578. This emerging value reveals the trend we expect to see the parity rise.
As can be seen from this example, it can not be expected that the movement of a parity in the financial sector will be uninterrupted. The Fibonacci Series provides analyzes that can help in determining this trend.
Another use of the Fibonacci series in the financial sector is Fibonacci Time Spans.
The most active stock market indexes in terms of transaction volume in the world are Dow Jones, Nasdaq, S & P500, Ftse and Xetra Dax. In Turkey, there are more than one index under the Istanbul Stock Exchange. The types of indices / indexes that the most transactions are realized in stock exchange Istanbul; BİST 100 index, BİST 30 index and BİST Banking index.
Rectangular graph formation occurs when prices are touched by both levels for a period of time between support and resistance levels.
These levels of support and resistance can be horizontal, as well as down or up-view channels. What is important here is not that the support and resistance levels are in the form of horizontal or up / down channels; Are parallel to each other.
The formation of the rectangle starts with the price movements rising from the support level, then comes back to the support level again after reaching the level of resistance and then completes by making a movement towards the resistance level again.
The entry point to the position is determined according to which side of the price will break after the completion of the fourth movement. The target price level is the distance between the support-resistance levels that form the rectangle, up or down, from the fracture level.
The concepts of support and resistance are not just forex markets, but a concept of technical analysis that is used throughout financial markets. In general, support can be explained as the level at which prices are expected to decline. The persistence of sales in the financial market at support levels is interpreted as the response of buyers at this level. However, it should not be forgotten that in the case of breakdown of important support levels, that is, if downward support points are crossed, sales will accelerate and the support point will become a point of resistance. Breaking a support point does not mean that the support level is below the support level. We can say when a level of support is broken, clearly when it closes below this level. When we look at the historical charts in Forex markets, the first multiplier is the support level where the sales are stopped and the prices can not fall further below this level. At these price levels, the Euro dollar pair has found support, as can be seen from the levels indicated by blue in the chart below. Below you can find examples of euro usd support resistance level.
CFDs; Such as stocks, bonds, indices or commodities. The sources of CFD contracts, which can be processed more easily and with lower capital, can be various financial assets.
It is an investment instrument that allows you to invest in future expectations of the underlying product without having a financial product with low collateral, by connecting lower collateral than the underlying product.
At the same time, CFDs, which are an easy investment tool, are also preferred and fast because of the need for fewer collateral, allowing investors to benefit from small price changes.
CFD products are divided into futures and demand. There are no maturities in underlying assets in demand contracts. In some demand CFD products, although the underlying asset is futures, the product may be traded on demand. The difference in the CFD products in this case will be reflected to the investor as transportation cost.
WHAT IS CFD BASED ON SHARES?
Futures CFD contracts are term contracts with a starting and ending date of which is known. You can trade as much as you want in the maturity. If your position is still open when the due date is reached, it is automatically closed by the system.
WHAT ARE THE ADVANTAGES OF CFD?
It enables you to gain access to all indexes, precious metals and commodities on a single platform, easily and profitably from both the rise and fall of the market.