Qstick indicator series is a momentum indicator that provides a moving average of the difference between the closing and opening price of an asset. The indicator was developed by Tushar Chande to numerically assist in identifying market trends by use of candlestick charts. QStick indicator is designed to show net price gain or loss in a specified period.
Key Features of the Qstick Indicator
• When Qstick line crosses the zero-line, transaction signals come over
• It guides in understanding market conditions such as strength and weakness of a market
• It represents a security exponential moving average (EMA) together with their simple moving average (SME).
How do you calculate the Qstick Indicator?
Qstick indicator (QSI) = [closing price – (Opening price * period * simple moving average]
What does Qstick Indicator tell you? ( Click this link to access an economic calendar for your trading strategies )
• In case the reading is below zero, it shows that most of the candlestick for the examined period is bearish, meaning that the trading instrument’s bias is bearish.
• If the reading is above zero, it shows that most of the candlestick for the examined period is bullish, meaning that the trading instrument’s bias is bullish.
How Does Qstick can generate trading signals?
• If the indicator crosses the zero line, this is the time to buy. On the other hand, if the signal goes below the zero lines, it is the time to sell.
• If the signal is shallow, and suddenly it starts rising, this is an excellent time to buy. When the signal is very high and starts lowering, it is the best time to sell.
• Suppose the market starts experiencing lower lows and the indicator forms higher lows. In that case, this is a signal to buy, and on the other hand, if the market is experiencing higher highs while the indicator forms lower highs, this is a clear signal to sell.
Rules of thumb when using the Qstick Indicator
• Be Always guided by the results of a simple moving average whether to sell or buy.
• If the indicator crosses over zero, buy. Sell when it crosses under zero.
• Buy after the signal stop showing an uptrend or immediately market prices start going downwards.
• When the indicator shows at an extremely low level, it is the time to buy.
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