Some simple indicators I use
Let me share some basic indicators which I use to look at my charts on a daily basis.
The first is using SMA 50, 100, 150, 200 and together with EMA 20 & 40. When the EMA 20 is above EMA 40, the price action is on short term uptrend. When SMA 50 above 150, implies medium term uptrend. Lastly when price is above SMA 200, and sloping upwards implies long term uptrend.
One easy way to look for resistance and support is to check how the price rebound previously. In Apple's daily chart, it rebounded or tested the 200 SMA, and usually a rebound off the 200 SMA is very bullish price action reversal. This is because the market maker hunt for stop losses below the 200 SMA and make those traders who set their stop loss there to close and exit their trades, and subsequently the stock price action moves upwards.
RSI 14
The next indicator I look at is Relative Strength Index, set at a time period of 14. When the RSI is above 80, it indicates overbought, and when RSI is below 20 implies oversold. Note that the price action can stay in the overbought or the oversold region for sometime. It does not imply that you should sell when it is overbought, but you should combine with other indicators to give a clearer signal.
Bollinger Bands plus Stochastics
The next I use is Bollinger Bands, set at Period 20 SMA and STD Dev 2. The stochastics are set at 5, 3, 3. Bollinger Bands act as an envelope surrounding the price action. If it reaches the top band, it implies the price action is overbought and due a pullback, and conversely, if price touches the lower band, it implies oversold and the price will soon reverse.
Together with stochastics, where above 80 implies overbought, and below 20 oversold, it will be a useful indicator to help decide when to buy or sell.
I hope you find these indicators simple and easy to use.
But wait, where do I read my charts? The Tiger app is usually quite space constrained on a mobile phone, so usually I use Trading View or Tiger Trade Desktop app on my computer. Trading View has free versions but with limited number of indicators, and a paid version with up to five indicators. Tiger Trade Desktop app is free for Tiger users, so give it a try if you haven't.
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