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YESFX Technical Analysis Center

Long Term Charts

6/3/2014

Copyrighted by YESFX LTD.

Long Term Charts


The weekly bar chart usually covers a period of only six to nine months. We use monthly charts for longer range trend analysis and forecasting. Our analysis of a market, should include some consideration of how the daily market price is moving in relation to its long range trend structure. The purpose of weekly and monthly charts is to compress price action in such a way that the time horizon can be greatly expanded and much longer time periods can be studied.

6/3/2014

Copyrighted by YESFX LTD.

Long Term Charts


The same principles apply :
for the intra day (tic-by-tic) for day trading purposes for trend trading the intermediate or long term trend (weekly, monthly, and yearly charts).

6/3/2014

Copyrighted by YESFX LTD.

Long Term Charts


LONG TERM TO SHORT TERM CHARTS Begin your analysis with the long rang and gradually work to the near term. Start with 20 year monthly chart
Continue with the most recent years ( monthly chart)

Then continue with the six months ( weekly chart)


And focus to the three weeks ( daily chart) If you want now proceed further with intraday charts Three days time span with hourly chart and 10 minutes chart for breakout purposes.

6/3/2014

Copyrighted by YESFX LTD.

Long Term Charts

6/3/2014

Copyrighted by YESFX LTD.

Long Term Charts

6/3/2014

Copyrighted by YESFX LTD.

Long Term Charts

6/3/2014

Copyrighted by YESFX LTD.

Long Term Charts


Long term charts are not meant for trading purposes. Are useful in the analytical process to help determine the major trend and price objective. They are not suitable for the timing of entry and exit points. Semi log chart scaling becomes more valuable when studying long range price trends.

6/3/2014

Copyrighted by YESFX LTD.

Long Term Charts


The most striking features of long range charts is that not only are trends very clearly defined, but that long range trends often last for years. Imagine making a forecast and not having to change that forecast for several years. Whatever randomness does exists in price action is probably a phenomenon of the very short term.

6/3/2014

Copyrighted by YESFX LTD.

Long Term Charts


FUTURES
CONSTRUCTION OF CONTINUATION CHARTS

The limited life in futures poses some obvious problems for the technician interested in constructing a long range chart going back several years. The answer is the continuation charts. The simplest method is to link a number of contracts together to provide continuity. Always we use the price of the nearest expiring contract. When stops trading, the next in line becomes the nearest contract and is the one plotted.
6/3/2014 Copyrighted by YESFX LTD. 10

Long Term Charts


SHOULD LONG RANGE CHARTS BE ADJUSTED FOR INFLATION?

The answer is : Its not necessary.

6/3/2014

Copyrighted by YESFX LTD.

11

Long Term Charts


1. The markets themselves have already made the necessary adjustments. If dollar declines => commodities rise If dollar rises => commodities fall
Declining commodity markets since the 1980s reflect a long period of disinflation. Should we take the price of gold, which is now worth less than half of its value in 1980, and adjust it to reflect the lower inflation rate? 2. Price action discounts everything, even inflation. All financial markets adjust to periods of inflation and deflation and to changes in currency values.

6/3/2014

Copyrighted by YESFX LTD.

12

Long Term Charts


After the gold price peak in 1980 we had two decades of low inflation which caused advance in stock prices. Why adjust the charts again for inflation? Its already been done.

6/3/2014

Copyrighted by YESFX LTD.

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