Trading Lesson 1

“Outside Days” Definition:

This word will be used frequently both by technical analyst and day traders in the stock market. If an index or a stock chart, the bar is more or less of the previous day trade than the day is Called outside day. It is also used in candlestick chart. Commonly it refers the stock price variation.

What is “Order Imbalance”?

During the stock market trading there will huge number of buy or sell order and we will not be able To process those orders which are called order imbalance. This situation will happen when there is a Release of news on stocks revenue, natural disaster, sudden political change, government policy and National or international economic news. Sometimes this order imbalance will be solved in a little time And for the stocks which is not trading more may lead to a few days.

“Over Sold” Definition:

In a period of time some stocks may trade beyond its face value, and this may happen due to some Unethical happenings in the market. The traders and investors will buy a huge volume of these type of Stocks. Commonly the stocks that are oversold will be a technical signal to buy those stocks.

How to show “Over Sold Stocks”?BoAML Total equity flows

If RSI (Relative Strength Index) indicator indicates below 30 then those stocks are oversold.

“Over Brought” Definition:

If a stock is trading at a larger price not related to its value, than RSI will be above 70 and will Indicate those stocks is over brought. During this time the traders and investors will tend to sell Their stocks. Incase if the stock is trading in the future, then they will go for Short. We have to avoid Buying these over brought stocks.

What is an “Alternative Order”?

In a trade if a stock is quoted at a particular price either to buy or sell, the broker will order Both the prices.This is called alternative order. For example, if an investor asks to buy a stock at 50 Rupees and the same investor ask to buy or sell that stock if it comes down to 45 Rupees.

“Bar Chart”

In trading if you are following technically the bar chart will show signal, and based on that investment Will involve in trade. In Barchart’s vertical line the top shows that days high value and the bottom Shows that day’s lowest value. Stocks that days starting price will be shown on the left side and the end price Will be shown on the right side.

What is a Stock Quote?

It refers to a value that is traded in the stock market. It holds the stocks basic details such as seller price, Buyer price, last traded price and about the volume of the trade. The investors or traders may know this Price through online or mobile phone. Some website will give delayed free stock quote. To know on Real Time Stock quote you have to pay for that.

 

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