Market Watch: UO Reading Below 40 for Donegal Group Inc (DGICB)

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13 September, 2017

Current levels place the share price around 6.268, while the MACD indicates a bearish trend.

MACD-Histogram bridges the time gap between the price movement and MACD. In fact, MACD is also an indicator of an indicator. The simple moving average is a mathematical calculation that takes the average price (mean) for a given amount of time. "This method features a fast attack average and a slow decay average so that composite average rapidly ratchets behind price changes and holds the average value until the next ratchet occurs".

The base for this indicator is the security's price. Taking a step further, the MACD-Histogram, which was developed by Thomas Aspray in 1986, measures the distance between MACD and its signal line (the 9-day EMA of MACD). It is an indicator of an indicator. Because MACD uses moving averages and moving averages lag price, signal line crossovers can come late and affect the reward-to-risk ratio of a trade.

SHH RESOURCES HOLDINGS BERHAD (7412.KL) now has a 14-day Commodity Channel Index (CCI) of -115.48. Employing the use of the moving average for technical equity analysis is still highly popular among traders and investors. Many traders will use the ADX in combination with other indicators in order to help formulate trading strategies. Using the CCI as a leading indicator, technical analysts may use a +100 reading as an overbought signal and a -100 reading as an oversold indicator, suggesting a trend reversal.

Traders may be also be focusing in on the ATR or Average True Range indicator when performing stock analysis.

Currently, the 14-day ADX for STL GLOBAL LTD. (SGL.BO) is sitting at 24.55. Many chart analysts believe that an ADX reading over 25 would suggest a strong trend. A value of 25-50 would support a strong trend. The ADX is typically used in conjunction with the Plus Directional Indicator (+DI) and Minus Directional Indicator (-DI) to help spot trend direction as well as trend strength. In general, a rising ADX line means that an existing trend is gaining strength.

Interested traders may also be keeping an eye on the Williams Percent Range or Williams %R. A move above 70 is widely considered to show the stock as overbought, and a move below 30 would indicate that the stock may be oversold. RSI can be used to help spot overbought or oversold conditions. The current 14-day RSI is presently sitting at 70.76, the 7-day is 73.38, and the 3-day is 71.01. Typically, if the value heads above -20, the stock may be considered to be overbought. If the indicator travels under -80, this may signal that the stock is oversold.

In terms of moving averages for UV Flu Technologies Inc (UVFT), the 200-day is now at 0.02, the 50-day is 0.00, and the 7-day is resting at 0.00. The RSI is considered to be an internal strength indicator, not to be confused with relative strength which is compared to other stocks and indices. When the RSI line moves up, the stock may be experiencing strength. The RSI operates in a range-bound area with values between 0 and 100. A value of 50-75 would signify a very strong trend, and a value of 75-100 would point to an extremely strong trend. Different time periods may be used when using the RSI indicator. On the flip side, a reading below -100 may signal a downtrend reflecting weak price action. Investors and traders may use this indicator to help spot price reversals, price extremes, and the strength of a trend.

For further review, we can take a look at another popular technical indicator. After a recent check, the 50-day Moving Average is 32.61, the 200-day Moving Average is 30.59, and the 7-day is noted at 32.09.


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