Technical Levels

Technical Levels
Technical levels are important price points, such as support and resistance for stocks and indices. Depending on whether stocks trade above or below technical levels could signify important trend shifts.

The important technical levels that need to be addressed today are the 200 day moving average for the NASDAQ and the 50 day moving average for the Dow. Thursday's trading took the indexes up through those levels but they closed just below.

Pivot Points are technical levels calculated using the high, low and closing prices of a given security. See also: Pivot Point Analysis
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Continuation Pattern ...

I'll use prices as of the close of trade on Thursday, Feb 6, to walk you through a few steps towards developing technical levels of you own.

Another example would be to use technical levels on the stock chart or even percentages for the stock price as you asked about.

These also give ideal technical levels to place protective stops, which can be placed just outside a support or resistance level
Besides the 5 point calculation used above, some other calculations are also used for the Pivot levels.

What should be looked for are either congestion areas on the chart, technical levels such as moving averages/trendlines, or retracement levels.

Intraday penetrations of important technical levels are often misleading signals, but quick bounces off support can be false signals as well. Candlestick patterns offer a means of confirming that a price has reversed itself at a key technical level.

To finish off this example we now have several components which make up a basic strategies for placing stops based on technical levels and can now analyze the feasibility of one of the trades here to see if it fits all of our criteria.

If you are a trend following kinda dude, then currency crosses may be easier to trade than the major pairs. It will be easier for you to spot the trend and be more confident in your entry points because you know that the these technical levels hold ...

See also: Market, Trading, Stock, Analysis, Support