Experience invester please answer stock technical question.?

Question

i am a day trader. i am starting to use technical tools. but want to ask a few question.

1)ho much can i depend on bollinger band. i just checked and i can see that google is touching the lower band and i think it is ready to break away in different direction. am i write.

2)how can i use volume to detemine when to buy ir sell.

3)how to use MACD. is it good to buy when its lower than the green line .

4)i heard that people use softerware. what are they talking about.

5) if a stock have a good new on a particular day and it is touching the lower band bollinger. should i expect a proit rom it that day.

6) people with tdameritrade account what is the different between the strategy desk and command center 2.0

i have tdameritrade and any other tip would great. thank u

Answer 1

It's more art, than science to trade using technical analysis. There is no definite rule that will tell you that when this happens, you buy/sell.

Here's what you can do.

- pick one, two at most, technical indicators together with your preferred chart (candlesticks, line chart, etc).

- following the rules on how to trade with those indicators, trade using a demo account.

- while trading on demo, when these two indicators gives you a signal to open a position, do so.

- when the trade is a loser, note in your trading journal, together with the chart jpeg image, what happened, why the trade became a loser, and what you can do about it next time.

- if the trade is a winner, again, write on your trading journal why you think that setup worked out.

- over the weeks, you will see a pattern. This will help you determine when to trade based on what your tools are telling you, and when not to trade.

- soon as you are comfortable using your technical tools, get back to live trading account and trade with the smallest position size possible and fine tune your trading method.

- with the live trading account, when you are able to profit consistently three months in a row, add to your position.

Hope this helps.

Jim http://jsforex.blogspot.com

Answer 2

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