maybank technical analysis

Technical Analysis User Guide

August 2010


August 2010

Table of Contents Table of Contents .........................................................................................................2

Technical Analysis .........................................................................................................3

Introduction ..............................................................................................................3

A. File Options .....................................................................................................5

B. Scrolling Text Message Area ..............................................................................6

C. Chart Types .....................................................................................................6

D. Chart by Timescale View ...................................................................................8

E. Chart Magnifier ................................................................................................9

F. Adjust Price .....................................................................................................9

G. Chart View Layout ............................................................................................9

H. Trading Options .............................................................................................. 11

I. Drawing & Annotation Tools ............................................................................. 12

J. Technical Indicators ........................................................................................ 13


August 2010

Technical Analysis Maybank Group is pleased to provide you, Technical Analysis, another valued added service

which will facilitate you in making the best investment decisions. It is a method of evaluating

securities by analyzing trading statistics generated by market activity, such as past prices and volume. In Technical analysis, it is not about the security's intrinsic value of a company or a

commodity but instead charts and other tools are used to identify patterns that can suggest future trading activity. It is our hope that you will make full use of the facility given based on

the guidelines listed below.

Introduction

The figure below is the overall functions and views of the Technical Analysis screen. As

explained, below are the descriptions related to this screen beginning with chart viewing selection followed by each of the labelled items.

Item Description

Original chart displayed once any stock is selected for Technical Analysis

An example of OBV option selected from Technical Indicator tools

Stochastic %K and %D option selected from Technical Indicator tools

File Options

1

2

3

Scrolling Text Message area Scrolling Text Message area Scrolling Text Me

J

I

E B C D H G

A

F

1

2

3

A


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Scrolling Text Area Message

Chart Types

Chart by Time Scale View

Chart Magnifier

Adjust Price

Chart View Layout

Trading Options

Drawing & Annotation Tools

Technical Indicators

B

C

D

E

F

G

H

I

J


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A. File Options You can use two available selections in order to open existing .dat format file, or to save your current viewing.

To open existing .dat format file: From the menu bar, click

the Open Folder icon as shown in the next figure.

Locate the existing file location.

Click Open. For example, see

next figure. Once Ramunia.dat file is opened, it will replace

current chart view.

To save the current chart view or analyzed results: From the

menu bar, click the Save File

icon as shown in the next figure.

Type in the File Name or

select from File Name list based on previous file name

used. Select from Save as type

(default is as *.dat). Click Save when done.


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B. Scrolling Text Message Area This area is for the purpose to display important messages or announcements from Maybank.

C. Chart Types Consist of three charts viewing types that are Bar Chart, Line Chart and Candlestick Chart.

Viewing Different Chart Types

Clicking any of the icons from this group will change the displays of the chart of current

window. Bar Chart

Bar Chart graphs the open, high, low, and last prices for a specific trading session over a given period of time.

To view chart in Bar Chart format: From the menu bar, click the Bar

Chart icon as shown in the next

figure.

Current window will display the

chart in a bar chart format.

Line Chart

Line Chart represents only the closing prices over a set period of time. The line is formed by connecting the closing prices over the time frame.

To view chart in Line Chart

format: From the menu bar, click the Line Chart icon as shown in

the next figure.

Current window will display the chart in line chart format.


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Candlestick Chart Candlestick charts provide a quick visual picture of the relationship between opening and

closing prices and their relative strengths or weaknesses, especially for extended periods.

To view chart in Candlestick Chart

format: From the menu bar, click the Candlestick Chart icon as

shown in the next figure.

Current window will display the

chart in a Candlestick chart format.


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D. Chart by Timescale View Consists of 6 types chart viewing based on timescale starting from daily (today), weekly (till today), monthly (till today), hourly (one hour), 15 minutes and as detailed down as 5 minutes.

Next, is the example if you select Weekly Chart view.

To view weekly (including today’s)

chart: From the menu bar, click the

Weekly Chart icon as shown in the next figure.

Notice that each bar represents their respective week. Written date is

every Monday of the week. For example, Week A begins on 6 November 2006 while week after,

Week B began on 13 November 2006.

Week A

Week B

Week A

Week B


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E. Chart Magnifier Allows you to zoom in (enlarge) and zoom out (reduce) the size of the chart. It also provides a zoom plus option for specific area.

Next figure shows how the Zoom Plus magnifier functions.

Point to your preferred area for which the Zoom Plus magnifier should apply on.

F. Adjust Price

This option enables users to make adjustment to the preferred stock’s price. Normally, stocks

which have Corporate Action issues will be have price adjustment.

G. Chart View Layout The view layout enables users to view different indicator on a different page. Advanced user

has six views to choose from while standard user has only two. The last layout will be used for comparison between Stock and Index (for advanced user). You will know you are at which

view from looking at the bigger and Cyan in colour of the layout digits selection.

To select view layout format, click

on any 6 digit numbers displayed.

Default layout is layout no. 1.

Note: Standard users will be

configured with 2 layouts that are layout 1 & 2.

Selected

zoom area

Enlarged

zoom result


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For example, selected layout is layout number 1.

Selecting Layout number 6 will

bring you to index/stock comparison view.

At the below area of the layout,

you may click on the Index/Stock name in order to compare with

other indices/stocks.

Selected layout is from layout item no. 1.


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Select Type from and then select Indices or Stock name from list in . For example,

current selection is from Indices Type named FBM KLCI.

H. Trading Options Consist of online Buy and Sell options for you to choose once you are satisfied with the

analysis performed for the selected stock.

Click Buy to proceed with buying of the

selected stock

Click Sell to proceed with selling of the

selected stock

Scrolling Text Message area Scrolling Text Message area Scrolling Text Me Selected layout is from layout item no. 6.

1

1 2

2


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I. Drawing & Annotation Tools

On the left panel of the Technical Analysis window is the Drawing & Annotation Tools. It consists of Fibonacci style chart drawing tools such as Fibonacci Retracements, Fibonacci Fans,

Fibonacci Time Zones and also regular drawing tools such as Trend and Horizontal Lines, Ellipses, Text Notes and etc. Just click any of these tools and then drag it on the chart to view

the results. Fibonacci

Leonardo Fibonacci was a thirteenth-century Italian mathematician who discovered the

significance and unique properties of a simple number series, in which each numeral is added to the previous to create the next one in the series: 0, 1, 1, 2, 3, 5, 8, 13, 21, etc. Fibonacci

numbers, and more significantly the ratio of those numbers to each other, can be found throughout nature and cycles. Fibonacci ratios are used in technical analysis to predict

retracement areas during pullbacks, as well as targets, called “extensions,” for projected price

moves.

Fibonacci Retracements

Horizontal line that divide the vertical distance by the key Fibonacci ratios of 23.6%, 38.2%, 50%, 61.8% and 100%.

Fibonacci Time Zones

A series of vertical lines that correspond to the sequence of numbers known as Fibonacci numbers. Fibonacci numbers are a sequence of numbers where each successive number is the sum of the two previous numbers.

Linear Regression Line

A Linear Regression Line is a straight line that best fits the prices between a starting price point and an ending price point. The Linear Regression Line is mainly used to determine trend direction.

Fibonacci Fans

Fan lines that divide the vertical distance by the key Fibonacci ratios of 23.6%, 38.2%, 61.8% and 100%.

Fibonacci Arc

Curve lines that intersect trend line at the key Fibonacci levels of 23.6%, 38.2% and 61.8%.

Basic Drawing Tools

Consist of horizontal and vertical line, ellipse, linear line, font, up and down arrows and also square shape

Erase All

To remove all the previously inserted drawing tools

Fibonacci Arc

Fibonacci Retracements

Fibonacci Time Zones

Linear Regression Line

Fibonacci Fans

Erase All

Basic Drawing Tools


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Technical Indicators

These indicators will provide a more detail analysis technically where it will involve mathematical calculation and scientific formula calculation. Currently there are 11 options

available namely as SMA (Simple Moving Average), EMA (Exponential Moving Average), MACD / MACD Histogram, RSI, Stochastic, OBV, Bollinger Bands, Volume and Parabolic. The

RSI and Volume are set as default Technical Indicators for selected chart that you choose to

analyze.

Simple Moving Average

A simple, or arithmetic, moving average that is calculated by adding the closing price of the

security for a number of time periods and then dividing this total by the number of time periods. In other words, this is the average stock price over a certain period of time.

Bollinger Bands

An indicator used to compare volatility and relative price levels over a specified time period.

Three bands are plotted: a simple moving average, an upper band of the simple moving average plus two standard deviations, and a lower band of the simple moving average minus

two standard deviations. When the markets become more volatile, the bands widen, or move

farther away from the average. When the markets are less volatile, the bands contract, or move closer to the average.

MACD

MACD analysis uses three moving averages, often exponential. Two of them are based on

the number of price periods used and the third is an average of the difference between the two moving averages. The difference between the readings of the two moving averages is

usually shown as a histogram, while the average of that difference is shown as a moving

average line plotted on top of the histogram. An important part of MACD analysis is how its movements compare with price movements to determine strength or weakness in the

market.

RSI

A technical momentum indicator that compares the magnitude of recent gains to recent losses in an attempt to determine overbought and oversold conditions of an asset. It

compares periods with up closes with periods that have down closes to produce an index

reading reflecting the strength of price changes on a scale of 0 to 100. It is an indicator that shows overbought or oversold technical conditions.

Volume

The number of shares or contracts traded in a security or an entire market during a given

period of time. Volume is an important indicator in technical analysis as it is used as a guide to identify market activity for a stock or index as to whether it shows supply or demand.

Exponential Moving

Average 1& 2 Bollinger Bands

MACD

RSI

Volume

OBV

KD (Stochastic)

Parabolic

Indicator Settings

Simple Moving

Average 1& 2


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Exponential Moving Average

A type of moving average that is similar to a simple moving average, except that more

weight is given to the latest data. This type of moving average reacts faster to recent price changes than a simple moving average. The 12- and 26-day EMAs are the most

popular short-term averages, and they are used to create indicators like the moving average

convergence divergence (MACD) and the percentage price oscillator (PPO). Drawing & Annotation Eraser

To remove the previously inserted drawing tools. Parabolic

A technical analysis strategy that uses trailing stops and a reverse method called stop-and-

reversal (SAR) to pinpoint entry and exit points.

KD (Stochastic)

A technical momentum indicator that compares a security's closing price to its price range

over a given time period. Stochastics measures the closing price relative to the low of the range for a selected period to indicate rising or falling momentum, providing trading buy (or

sell) signals when its lines cross into overbought or oversold territory.

OBV

A method used in technical analysis to detect momentum, the calculation of which relates volume to price change. OBV provides a running total of volume and shows whether this

volume is flowing in or out of a given security. OBV attempts to detect when a financial

instrument (stock, bond, etc.) is being accumulated by a large number of buyers or sold by many sellers.

Indicator Settings

Parameter settings for technical indicators.

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