Key Takeaways Average true range (ATR) is a volatility indicator that can help traders set their exit strategy The most common lookback period for ATR is the 14-period, but some strategies favor other periods Using ATR to set a stop or other exit order involves choosing a multiplier New traders often tell us that they […]

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Key Takeaways Understand the put/call ratio and how it can help traders and investors gauge market sentiment Learn how to monitor the P/C ratio for all stocks with listed options, as well as the ratio for each individual stock, on the thinkorswim® platform from TD Ameritrade To follow or bet against the crowd? Some say it […]

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Key Takeaways If you have charting basics down, it’s time to expand your technical analysis knowledge     Explore several alternative technical indicators that may be useful in your trading Thermo Mode and Monkey Bars are unique to the thinkorswim® trading platform from TD Ameritrade Unless you’ve been living on a desert island for 30 years, you’ve probably […]

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Key Takeaways The simple moving average (SMA) is calculated by adding up the closing prices of a specific number of days (or other time periods), then dividing by that number  The exponential moving average (EMA) is similar to the SMA, but it gives more weight to the most recent data Your time horizon may help […]

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Key Takeaways Use trendlines to help identify areas of price support and resistance  Learn how a breakout from a pennant can be a precursor to a trend continuation  You probably wouldn’t hop on a tour bus in a big foreign city without bringing along your handy sightseer’s guide. The same applies to the markets. Eyeballing […]

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Bull or Bear, the trend is your friend, say traders. So when it comes to determining your opinion of a trend’s strength, the Average Directional Index can help you screen for BFFs. A compass can be a great tool for unfamiliar territory, but it has limitations. It can tell you direction, yet it doesn’t necessarily […]

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If the market were the Old West, right about now you might be “shooting from the hip,” reacting to anything that moves, and every market whim. But hold on there, trader. You now have electric can openers, as well as time to identify your target, take aim, and fire more thoughtfully. From a technician’s perspective, […]

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In the world of trading, there are basically two types of approaches. Think of one as traditional and discretionary, where you manually execute trades using a set of indicators and inputs. You trade with your gut, while your emotions pose the biggest threat to smart trades. The other approach is mostly mechanical. You use a […]

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When asked to describe a widespread problem and then offer a solution I thought they meant for something like global warming. But alas, it was to solve a problem related to thinkorswim® using thinkScript®, the do-almost-anything-we-didn’t-think-of tool.  For my first trick, I want to show you how to build a chart that displays the ratio of […]

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In the many books on technical analysis, visible chart patterns seem to jump right off the page. Such is the power of selective editing. In the real world though, finding a charting pattern with a clean signal and imminent breakout is more like playing connect the dots on television static. To help sort through the […]

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