Market dynamics are the forces that impact prices and the behaviors of producers and consumers in an economy and can also impact any industry or government policy. Market dynamics create pricing signals that result from a change in supply and demand. Economic models cannot capture some dynamics such as human emotions which affect markets, increase…
Gaps and Gap Analysis Price charts often have blank spaces known as gaps. They represent times when no shares were traded within a particular price range. Up Gap: Today’s Low/Open/Close > Previous Day’s High/Open/Close Down Gap: Today’s High/Open/Close < Previous Day’s Low/Open/Close Gaps result from extraordinary buying or selling interest developing due to a change…
Gann Theory: A Pattern, Price and Time Combined Analysis The study of pattern, price, and time and how their relationships affect the market. Gann based predictions of price movements on three premises: Price, time, and range are the only three factors to consider. The markets are cyclical in nature. The markets are geometric in design…
Elliott Wave theory asserts that crowd behavior ebbs and flows in clear trends. Based on this ebb and flow, Elliott identified a certain structure to price movements in the financial markets. A basic 5-wave impulse sequence and 3-wave corrective sequence in trends are explained to find out the major trend. Basic Sequence There are…
There are four separate theorems that addressed trend identification, buy and sell signals, volume, and trading ranges. The first two are deemed the most important and serve to identify the primary trend as bullish or bearish. The second two theorems, dealing with volume and trading ranges, are not considered instrumental in primary trend identification. Volume…
