Learning Track: Technical Analysis Using Quantitative Methods

In this section, you will learn about what candlesticks are and how they are formed. Then we will move on to learning about candlestick patterns and the key advantages of using them while trading.

In this section, you will learn about the formation of a bullish marubozu candlestick pattern and you will be able to identify the same on TradingView.

In this section, you will learn how to create a trading strategy on the bullish marubozu pattern, backtest it and analyse the strategy performance.

This section will walk you through the steps involved in taking your trading strategy live. You will learn about backtesting and live trading platform, Blueshift. You will learn about code structure, various functions used to create a strategy and finally, paper or live trade on Blueshift.

Blueshift Live Trading Template

In this section, you will learn about the formation of a bearish marubozu candlestick pattern, and you will be able to identify the same on TradingView.

A hammer is a bullish candlestick pattern. In this section, you will learn how to identify a hammer pattern and also how to create a trading strategy based on the hammer pattern and analyse the strategy’s performance.

The hanging man may look the same as the hammer pattern but both of them are formed in different market conditions. The hanging man is formed during an uptrend, contrary to the hammer, which is formed during a downtrend. In this section, you will learn about the hanging man pattern and also a trading strategy on the hanging man pattern and analyse the strategy performance.

In this section, we will learn about a bearish candlestick pattern called the shooting star. You will also learn how to create a trading strategy on the shooting star pattern and analyse the strategy’s performance.

Doji indicates indecisiveness in the market. In this section, you will learn why Doji is an indication of indecisiveness. You will also learn about different types of Doji patterns and how to interpret them.

In this section, you will learn about bullish and bearish engulfing patterns. You will be able to identify engulfing patterns in tradingview and also explain the expected trend prior to engulfing pattern formation to trade more effectively. You will also learn to define the entry and stop-loss price.

Piercing Pattern is a bullish candlestick pattern. It has more lenient criteria of formation compared to bullish engulfing patterns. In this section, you will also learn the specifics to look for to identify piercing pattern and place trades using it.

The formation of the dark cloud cover is the opposite of the formation of the piercing pattern. It is used to initiate short positions. In this section, you will learn how to identify trading opportunities using a dark cloud cover pattern.

When in trade, you can also come across a candlestick pattern. In a long trade, you can come across a hammer pattern. What should you do in such a situation? What if you come across a shooting star pattern? Answers to all these questions are covered in this section.

Candlestick patterns might not always work as desired. In this section, you will learn about the limitations of trading using candlestick patterns.

It is time to apply the knowledge you have gained in the course to a capstone project where you will create and backtest your own trading strategy based on candlestick patterns. Don’t worry if you get stuck, we have provided a model solution for you to reference.

In this section, you will learn to install the Python environment on your local machine. You will also learn about some common problems while installing python and how to troubleshoot them.

In this section, we will summarise the key concepts learned in the course. You will also find the zip file containing the strategy codes and data files at the end of this section.

In this section, you will dive into the details of swing trading and understand what constitutes a swing. You will also go through real life examples of swing highs and lows in the prices of a stock. While swing trading can be applied to a plethora of assets, you will see why it is the most effective on trending assets.

Why will a person who can read charts, implement a systematic trading strategy? You will realise that even though discretionary traders are still successful, systematic traders have an advantage over them due to the efficient use of technology, and the ability to test their strategy on years of past data in a matter of minutes. You will also learn how Python can greatly reduce the burden of coding your strategy.

This section will help you update your knowledge of Python with simple exercises on implementing functions, and manipulating dataframes using Numpy and Pandas libraries. The Quantra environment ensures that you don’t have to install anything for the Jupyter notebooks to function.

An important component of a successful strategy is the data set used. In this section, you will learn how to import the correct data from various web resources, so that you can work on your own unique strategy.

A successful trader always has a plan in place before they start creating a trading strategy. In this section, you will go through the steps to create your trading strategy in a step by step manner.

The importance of technical analysis in trading is highlighted in this section. Technical indicators and their types are introduced in this section. You will also learn how to select the right technical indicators for swing trading.

Moving average is calculated over rolling subsets of data and helps to understand the trend in price series. This section explains simple moving average and exponential moving average, how to calculate them and the interpretations of crossover of the moving averages.

Moving Average Convergence Divergence is one of the most widely used technical indicators. It uses the principle of crossovers. In this section, you will learn about the different components of the MACD indicator. You will also learn how to generate entry signals using an MACD indicator.

Having the right exit rules in a trading strategy can increase the success of the strategy. This section talks about the need for exit rules in a trading strategy, and the different ways to exit open positions.

Backtesting is used to separate good strategies from bad ones. In this section, you will learn how to analyse the performance of your strategy on the historical data through backtesting.

You understood the importance of backtesting in creating a good strategy. In this section, you will learn to develop and backtest a swing trading strategy in Python. You will also learn to calculate the PnL of the strategy.

The performance of a strategy is not only based on the returns generated, but also on risk. This section will help you understand how you can assess your strategy based on returns, risk as well as both. You will learn about the different evaluation metrics in this section. You will also analyse the performance of your strategy later in the section.

This section will walk you through the steps involved in taking your trading strategy live. You will learn about backtesting and live trading platform, Blueshift. You will learn about code structure, various functions used to create a strategy and finally, paper or live trade on Blueshift.

This section includes a template of a trading strategy that can be used on Blueshift. The live trading strategy template is based on the strategy discussed in the course. You can tweak the code by changing securities or the strategy parameters. You can also analyse the strategy performance in more detail.

This section will take you through the drawback of using a single indicator. A single indicator can generate false signals. You will learn how to overcome this problem by adding another indicator.

Williams Fractal looks at the high and low prices of five candlesticks, and depending on the pattern, identifies a price reversal. In this section, you will learn the significance of Williams Fractal. Further, you will implement a trading strategy using the Williams Fractal.

In this section, a composite swing trading strategy is implemented in Python. The MACD and Williams Fractal indicator are used together to get a refined strategy signal.

There are hundreds of assets which can be traded in an exchange. But not all of them are the best choices for a swing trading strategy. You will use a screener and shortlist stocks based on liquidity, market cap, penny stock, trending, or distance from 52 week high and low.

Safeguarding your portfolio against risk is one of the most important steps in trading. In this section, you will learn how to protect your capital through diversification and position sizing. You will also learn about the black swan events and how to protect yourself against them.

Learn to install the Python environment in your local machine.

In this section, you will undertake a capstone project where you apply the swing trading strategy on multiple assets. This project helps you to practice and apply the concepts learnt in this course.

In this section, you will go through the different concepts you learnt throughout the course. You will also be able to download all the strategy notebooks as a zip file. You can use these notebooks and modify its contents to create your own unique strategy.

Technical analysis consists of incorporating elements of a price chart and trying to estimate the future direction of an asset, or the market. In this section, you will understand the basics of technical analysis. Further, no method of analysis is perfect and technical analysis is no different. You will also understand when technical analysis can fail and how to overcome it.

While trading in a trending market, you need to ace the entry and exit points. If you enter a long trade at the beginning of an uptrend, you’d probably make a lot of money. But if you enter this trend at the brink of a reversal, you might face extreme losses. In this section, you will learn which category of technical indicators falls under ‘trend’ indicators. You will also learn how you can use the current direction of a trend in your favour.

Moving averages are the most popular and widely used trend indicators. In this section, you will learn how to use the Simple Moving Average to identify price trends. You will also learn about the SMA and price crossover strategy. Towards the end of this section, we will implement this strategy using Python.

One of the important steps after creating a strategy is to assess its effectiveness by computing metrics like the win-loss ratio, average PnL, etc. In order to do that, you need to record the details of all the trades taken. In this section, you will learn how to record the details of all the trades taken by generating a trade sheet.

To understand whether your strategy is working, you need to analyse certain metrics. In this section, you will learn how to evaluate the trade level metrics to depict how well the strategy has performed over a certain period of time, as well as evaluate the performance of your strategy based on returns, risk and both.

The journey towards building a good backtest for a strategy idea is incomplete without considering the transaction costs and slippages. In simple words, transaction costs encompass brokerage, commission, etc. Slippage is the difference between the expected and executed price. Learn these concepts and understand how to incorporate them into your trading strategy in this section.

Learn how you can take your backtested strategy live with some important steps. Learn about the code structure, the various functions used to create a strategy, and finally, paper or live trade on Blueshift.

This section includes a template of a trading strategy that can be used on Blueshift. This live trading strategy template uses moving average crossover to generate entry and exit signals. You can tweak the code by changing securities or the strategy parameters. You can also analyse the strategy performance in more detail.

The Weighted Moving Average is one of the many variations of moving averages. The uses of the weighted moving average, its calculation and its principles are all covered in this section.

In this section, you will learn about the Exponential Moving Average, its calculation and interpretation. It includes the implementation of a price crossover strategy. We will also touch upon a few other variations of the moving average and the frequently asked questions about the moving averages.

Moving average strategies can also be built based on multiple moving averages. The double and triple crossover strategies are covered in this section. What are the trading rules? How well does the strategy perform? All of these questions, and more, are answered in this section.

Moving Average Convergence Divergence is one of the most widely used technical indicators. It uses the principle of crossovers. In this section, you will learn about the different components of the MACD indicator. You will also learn how to generate entry signals using an MACD indicator.

By looking at the price chart, you can visually identify if the price of any financial asset is increasing or decreasing. But what if you want to quantify that increase or decrease in price? And how does quantifying the change in price help you in trading? This section will help you to answer these questions, and more.

RSI is one of the most popular technical indicators and is widely used by traders around the globe. You will discover the rationale behind the RSI indicator in this section, as well as how to interpret it.

In this section, you will learn about the properties of the RSI indicator and how it can be practically applied in trading. Additionally, you will also learn how to create a strategy based on the properties of this indicator and evaluate its performance.

The price does not tell you all there is to know to forecast the movement of a security. You can look at other parameters as well. One such parameter is volume. In this section, you will learn about volumes, spikes in volume and a volume-based indicator known as on-balance volume.

The on-balance volume attributes the entire volume traded in a day to either only the buyers or only the sellers. This, however, is not practical. In this section, you will learn about the Chaikin A/D indicator and how it deals with this limitation of on-balance volume.

Most indicators no matter how well they work have certain limitations associated with them. In this section, you will learn about the limitation of Chaikin A/D and on-Balance volume indicators.

In this section, you will learn about a volume-based indicator called the Chaikin Oscillator. You will learn the interpretation of this indicator and also how you can calculate it in python.

In this section, you will learn how to create a trading strategy by using the Chaikin Oscillator. Along with this, you will also learn how to combine this indicator with Bollinger Bands. You will learn how to implement these strategies and analyse their performance in python.

Using a single indicator is a straightforward process. However, when it comes to combining two or more indicators knowing the purpose of this combination, how these indicators are selected and how to generate signals, are some key points that a trader must know. This section will teach you all about multiple indicator strategies, how to build and also how to implement them.

Looking at a stock from all angles helps traders analyse that stock in a better manner. The price charts change as the timeframe changes. Which timeframe is the best? How do you make your analysis better? Can you use multiple timeframes to analyse a single stock? All of these questions will be answered in this section as we build a multiple indicator strategy, implement it, and analyse its performance.

In this section, you will learn about a volatility-based indicator called The Average True Range (ATR). You will learn to calculate the True Range and Average True Range to measure stock volatility.

Risk management is one of the key elements of a trading strategy. The performance of a trading strategy can be improved with the help of risk management. In this section, you will be learning how to bring down the level of risk of your strategy by applying methods like ATR-based stop-loss and take-profit levels.

Most traders use a market index to check how the broad market is performing. But a market index can show a different picture than reality. In this section, you will understand why you should look beyond a market index and instead focus on the individual constituents of the index to understand how well the market is performing.

The McClellan Indicator uses the daily performance of the stocks that make up the market and quantifies this information to help us judge the market’s performance. In this section, you will understand how the McClellan Indicator is calculated and its interpretation.

In this section, you will understand the importance of the AD line in predicting a recession in the market. Further, you will apply the same principles and try to check if the McClellan indicator can predict a market crash. You will also understand the limitations of the McClellan indicator.

The TRIN indicator uses both price and volume information to analyse the broad market breadth and based on the value, we can interpret if the market is bullish, or bearish, and also when a reversal might happen.

In this section, we will discuss the limitations of the TRIN indicator and how to create a strategy using the TRIN indicator components.

In this section, you will attempt to create a screener which uses the stocks which are a part of the S&P500 and filter only those stocks which are positively trending. Further, you will assign ranks and choose the top 20 positively trending stocks. Finally, you will also create a dashboard which comprises multiple indicators and their signals. You can use this dashboard to get an overview of a certain stock and base your decision based on these indicators.

While it is easy to identify rules which help you increase your capital, it is difficult to stick to them. Understand the 5 secrets which successful traders always follow.

It is time to apply the knowledge you have gained in the course to a capstone project where you will create and backtest your own trading strategy based on technical indicators. Don’t worry if you get stuck, we have provided a model solution for you to reference.

Learn to install the Python environment in your local machine.

In this section, we will summarise the key concepts learned in the course. You will also find the zip file containing the strategy codes and data files at the end of this section.

Technical indicators are commonly used to determine a stock's price trend in order to take a trading decision. Is there a way to do this without using technical indicators? Yes, you can use the concept of price action trading. In this section, you will learn about the basics of price action trading.

Supply and demand analysis is a tool used in price action trading. In this section, you will learn about the demand and supply forces. You will learn how to identify the demand and supply zones and take trades based on these zones.

When the price enters the supply or demand zone, do you think it directly reverses as soon as it enters that zone? Not really. The price forms a pattern according to the price behaviour before it reverses. This pattern is known as a reversal pattern. In this section, you will learn about one of the most well-known patterns known as the head and shoulders pattern.

Can the head and shoulders pattern have unequal shoulders? Can the head and shoulders pattern have a slanted neckline? You will find the answers to all such questions in the section.

Knowing how to trade the head and shoulders patterns is important. But, in order to trade the pattern, you need to detect it first. Through this section, you will learn how to detect the head and shoulders pattern in python.

With backtesting, we can evaluate any of our trading strategies objectively. It helps to assess the viability of the trading strategy. In this section, you will learn how to backtest the head and shoulders pattern. You will learn how to record the details of all the trades taken by generating a trade sheet.

To understand whether your strategy is working, you need to analyse certain metrics. In this section, you will learn how to evaluate the trade level metrics to depict how well the strategy has performed over a certain period of time, as well as evaluate the performance of your strategy based on returns, risk and both.

The journey towards building a good backtest for a strategy idea is incomplete without considering the transaction costs and slippages. In simple words, transaction costs encompass brokerage, commission, etc. Slippage is the difference between the expected and executed price. Learn these concepts and understand how to incorporate them into your trading strategy in this section.

A reversal pattern can either be bullish or bearish. In this section, you will learn about a bullish reversal pattern called the inverse head and shoulders pattern. You will learn how this pattern is formed and how you can trade this pattern by determining entry and setting stop-loss and take-profit levels.

In this section, you will learn the double top pattern. You will learn about the formation and the price action of this pattern. Further, you will also learn how to trade this pattern and how you can implement it in python.

A double bottom pattern is an indicator of a bullish reversal. In this section, you will learn how the pattern is formed and the points that you need to keep in mind while trading on the basis of this pattern. You will also learn about the entry and exit conditions of the double bottom pattern strategy.

Is it possible to have a reversal pattern with more than two tops? What are the maximum number of tops that a reversal pattern can have? This section will answer these questions. In, this section you will learn about the triple and n-top patterns. You will also learn about the formation and price action of these patterns.

A triple bottom pattern is a strong indicator of a bullish reversal. In this section, you will learn how the pattern is formed, how to trade with this pattern and what are the things that you should keep in mind while implementing a triple bottom pattern strategy.

The prices of an asset may continue the price trend after forming a pattern instead of reversing. Such patterns that indicate that the price will move in its original direction are known as continuation patterns. In this section, you will learn about the basics of continuation patterns and how they are formed.

This section explains a continuation pattern known as the triangle pattern. Through this section, you will learn how a triangle pattern is formed. You will also learn about the different types of triangle patterns and further understand the price action of these patterns.

This section explains a continuation pattern known as the flag pattern. Through this section, you will learn how a flag pattern is formed. You will also learn about the different types of flag patterns such as the bull flag and bear flag patterns. Further, you will understand the price action of these patterns.

This section explains a continuation pattern known as the pennant pattern. Through this section, you will learn how a pennant pattern is formed. You will also learn about the different types of pennant patterns and further understand the price action of these patterns. You will also understand the differences and similarities between the pennant and the symmetric triangle pattern.

Support and resistance levels are one of the core tools used by price action traders, especially during the sideways phases. In this section, you will learn to uncover these hidden demand and supply levels within price charts. And further, you will also learn to programmatically identify and mark these levels in the price charts.

Detecting support and resistance levels in itself is not sufficient. Through this section, you will learn to use this information to your advantage, by implementing a simple trading strategy based on the support and resistance levels.

Learn how you can take your backtested strategy live with some important steps. Learn about the code structure, the various functions used to create a strategy, and finally, paper or live trade on Blueshift.

Blueshift Live Trading Template

Pivot points were even used by floor traders to automatically find areas of support and resistance based on certain pre-defined calculations. In this section, you will familiarise yourself with this popular price action tool and understand how to implement it to improve your trading.