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Category Archives: Learning Zone

What are Support and Resistance Levels?

What are support and resistance? Resistance is a price level where rising currency stops, changes direction, and begins to fall, keeping a currency pair from rising higher. Often viewed as a “ceiling.” Support occurs when falling prices stop, change direction, and begin to rise, keeping a currency pair from falling further. Often referred to as a “floor.” If price breaks ... Read More »

What is the RSI or Relative Strength Index?

The Relative Strength Index (RSI) identifies whether a specific currency pair is overbought or oversold. A currency pair that is overbought means traders have theoretically pushed the price to very elevated levels and therefore the rally may soon lose momentum. Currency pairs with the RSI in oversold territory suggests that traders have pushed the price to very low levels and ... Read More »

The Head and Shoulders Pattern.

What is a head and shoulders top pattern? In the head and shoulders top pattern, an initial rise is followed by temporary decline, creating the left shoulder. Subsequently, the price rises past the initial peak and once more declines, formulating the pattern’s head. The price escalates again, this time rising only as far as the initial peak of the formation ... Read More »

What are Trendlines?

What is a trendline and how can it be used? Trendlines connect significant highs and lows to create a visual representation of support or resistance. Must connect at least two and ideally three or more points to be effective. Trendlines can be horizontal, upward or downward and extend beyond to the right in order to illustrate future support and resistance. ... Read More »

What is a MACD or Moving Average Convergence / Divergence

What is MACD? MACD stands for Moving Average Convergence Divergence. The indicator determines whether the trend of a given currency is bullish or bearish. There are 3 components to the MACD indicator: a faster moving average, a slower moving average, and a histogram that calculates the difference between the faster and slower moving averages. The default settings for the MACD ... Read More »

Dreams of Easy Money…

Dream On! There is no free lunch. This age old adage remains true even in the case of online trading. It is not a get rich quick scheme. Firstly, when learning online trading, you must understand that to succeed you cannot rely on anyone forever – it needs to come from within. It has to come from inside you. If ... Read More »

What are Fibonacci Numbers and Lines?

History of Fibonacci Fibonacci Retracement is a relationship within a sequence of numbers. Discovered by Leonardo Fibonacci, the sequence of numbers is as follows: 0, 1, 1, 2, 3, 5, 8, 13, 21, 34, 55, 89, 144, etc. Put simply, the Fibonacci sequence is composed of the sum of the two preceding terms. However, the most important portion of the ... Read More »

What are Stochastics?

What are Stochastics? Stochastics provides possible points of reversal in price by attempting to determine when a market is overbought or oversold. An overbought level suggests traders have pushed the price to extremely elevated levels and therefore the rally may lose momentum. A currency pair with Stochastics in the oversold territory suggests that traders have pushed the price to very ... Read More »
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