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Monday, February 8, 2010

Analyzing and profiting in Oil market

There are a few basic but important steps that you need to follow if you want to make profits in oil market


  • 52week highs and lows: it is the highest and lowest price which the oil prices hit In the previous year.
  • Fibonacci analysis this is one of the most famous among the oil trading every number in the sequence is the result of previous 2 numbers and the resulting number can be converted into their ratios that seem to be important reversal signals whenever the oil rates crosses these Fibonacci ratios it would a buy or a sell signals.
  • Elliot wave principle these are the pattern of five wave 1, 3 and 5 being upward wave and 2,4 being downward wave by recognizing these waves one can find whether the market might move upwards or downwards.
  • Momentum indicator compares the current oil price with that of several years may be 10 yrs or even more by calculating the rate of change between these years divided by price several years ago. Whenever the result crosses 0 it indicates a trade to buy or sell.
  • Relative strength index it compares the upward close to the downward close of the stock.

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Quarterly Results

Lupin Q3 net up 38 pct, in line with forecast

Tata Steel Q3 net up 155% to Rs 1,191.75 cr

Canara Bank Q3 profit zooms 50 pct

Dena Bank Q3 net dips 4 pct to Rs 134 cr

Lanco Infratech Q3 net up 34 pct at Rs 106 cr

Motherson Sumi Q3 net nearly triples as sales surge

BPCL Q3 net down by more than half

Stock Terms and jargons

Active Share: An active share is the one which has a volume in trade (it has changed hands in many), these are the shares which are easy to buy or sell. which also may have some news sticked along with it.

Advance-Decline ration: It is also known as advanced decline ratio. This ratio is used to find whether market is in bullish trend or in the bearish trend, in other words whether the market is in advacing or declining. It is found by dividing the total number of advanced shares to the total number of declined shares. For instance: there are a total of 10000 stocks listed in the market of them 800 advances and 200 declines then the Advance Decline ratio would be 4 and since the ratio. Any value more than 1 would indicate a rising trend (bullish trend) and any value which is less than 1 would indicate a declining trend (bearish trend).

ADR: American Depository Receipt is a negotiable receipt issued by the US banks stating that the number of shares have been deposited with them. This can be directly traded in the stock market. This in turn eases an American investor to buy ADR than to buy an foreign stock in a foreign market. The rate of an ADR is close to the rate of the stock in the home market.

After-Tax:

Aging Schedule

AGM or Annual General Meeting

Amortization

Annual Report

Application-Money

Asset

Asset Coverage

Asset Financing

Auction Market

Auctioning of an Issue

Automated Screen Trading (AST)

Average

Averaging

Averaging In/Averaging Out.