Asume (t) stands for the sell or buy day. T -1 would be The day before the sell or buy day.
The safe thing to do is not to violate the trend, so we will only take short trades. Long trades could be benificial though. But remember I am just paper trading.
I have added a 30 ( red dashed line) and a 40 day MA ( dashed green line). They are clearly down and no MA is crossing over them. This may or may not be the bottom.
Stochastics , CCI, RSI and MACD are all momentum indicators. They are confirmation of move but are lagging indicators.
Notice todays white candle (Jan 15 ,99 ) ( we are not including trading
of Jan16,99) yesterdays
candle is black and is a new low for this most
recent move. It is not as low as the green candle
( green shows overbought or oversold). The low of the green candle
213 is support. if prices can
turn around and drop lower and break 213 the next low and support is
210 . If it breaks this , in
theory it could go much lower.
My guess is that the trading day after the present white candle will
be another white and then
possibly another white after that. If we get a close above the 40 day
MA we may have a change in
trend.
This is just one method of trading. If my explanation is too elementary or if you find errors in my analysis , please let me know and be aware....I AM NOT GIVING TRADING ADVICE. THESE ARE PAPER TRADING IDEAS.