How to Use EPS for Evaluating Shares

Author: Victor Gryazin

Dear Clients and Partners,

To choose interesting stocks for investing, market players evaluate carefully various economic indices and statistics. This overview is devoted to one index called Earning per Share, or EPS.

What is EPS?

This Earning per Share index evaluates how profitable a certain company is in terms of one share. This multiplier shows the relation of net profit over a year’s time and the number of its ordinary shares in turnover, giving an idea of what profit can be brought to the investor by each share they buy.

In essence, each shareholder holds their share of the authorized capital of the company that equals to the number of issued shares. The profit made is given proportionally to each shareholder. So, the EPS multiplier reveals how much money out of the invested sum will return to the investor. The higher the EPS, the more profitable it is to invest in the company.

The profit made by the company can be fully or partially given to the shareholders as dividends. Here, things depend on the decisions of the board of directors. Shareholders via their representatives on the board can influence the issue, altering the share of the profit that will be given out to the shareholders in the form of dividends.

How is EPS calculated?

For calculating EPS, we use the net profit minus dividends on privileged shares. the formula is as follows:

EPS = (P – Div) / N

Where:

• P is the net profit of the company for the reporting period (after taxes)

• Div is the dividends on privileged shares

• N is the number of ordinary shares in turnover in the reporting period

Example of calculation:

As an example, let us use Netflix (NASDAQ: NFLX). Over the last financial year, the company reported 2,761,395,000 USD of net profit, while the total number of ordinary shares in turnover was 440,922,000 shares.

The balance report says that Netflix did not issue privileged shares, so in the calculation formula, we subtract nothing.

Dividing the net profit of 2,761,395,000 USD by 440,922,000 shares, we get EPS of 6.26 USD per share.

You can check EPS in economic reports or on websites. For EPS or American companies, for example, go to Finviz.com:

Closing thoughts

EPS gives a chance to assess the potential profit made on one shares of the company you are planning to invest in. The multiplier has equally advantages and drawbacks, so it is recommended to be used alongside other multipliers, P/E being the most frequently used one.

Read more at R Blog - RoboForex

Sincerely,
RoboForex team

RoboForex: changes to the trading schedule (in view of the Christmas and New Year holidays)

Dear Clients and Partners,

We are informing you that there will be some changes to the trading schedule* during the Christmas and New Year holidays.

MetaTrader 4 / MetaTrader 5 platforms

Schedule for trading on DE30Cash and DE40Cash

• 24 December 2021 – no trading.

• 27 December 2021 – trading as usual.

• 31 December 2021 – no trading.

• 3 January 2022 – trading as usual.

Schedule for trading on CFDs on GDRs

• 24 December 2021 – no trading.

• 27 December 2021 – no trading.

• 28 December 2021 – no trading.

Schedule for trading on other instruments

• 24 December 2021 – no trading.

• 27 December 2021 – trading as usual.

• 31 December 2021 – trading stops at 8:00 PM, server time.

• 1 January 2022 – no trading.

• 2 January 2022 – trading as usual.

R StocksTrader platform

Schedule for trading on GER40

• 24 December 2021 – no trading.

• 27 December 2021 – trading as usual.

• 31 December 2021 – no trading.

• 3 January 2022 – trading as usual.

Schedule for trading on UK100, SPA35, FRA40

• 24 December 2021 – no trading.

• 27 December 2021 – no trading.

• 28 December 2021 – no trading.

• 29 December 2021 – trading as usual.

• 31 December 2021 – no trading.

• 3 January 2022 – no trading.

• 4 January 2022 – trading as usual.

Schedule for trading on UK stocks

• 24 December 2021 – no trading.

• 27 December 2021 – no trading.

• 28 December 2021 – no trading.

• 29 December 2021 – trading as usual.

• 31 December 2021 – no trading.

• 3 January 2022 – no trading.

• 4 January 2022 – trading as usual.

Schedule for trading on CFDs on EU stocks

• 24 December 2021 – no trading.

• 27 December 2021 – trading as usual.

• 30 December 2021 – no trading.

• 31 December 2021 – no trading.

• 3 January 2022 – trading as usual.

Schedule for trading on other instruments

• 24 December 2021 – no trading.

• 27 December 2021 – trading as usual.

• 31 December 2021 – trading stops at 8:00 PM, server time.

• 1 January 2022 – no trading.

• 2 January 2022 – trading as usual.

cTrader platform

Schedule for trading on all instruments

• 24 December 2021 – no trading.

• 27 December 2021 – trading as usual.

• 31 December 2021 – trading stops at 8:00 PM, server time.

• 1 January 2022 – no trading.

• 3 January 2022 – trading as usual.

Please take note of the above trading schedule changes when planning your trading activity.

* – This schedule is for informational purposes only and may be subject to further change.

Sincerely,
RoboForex team

What Are Futures and How to Trade Them?

Author: Andrey Goilov

Dear Clients and Partners,

Many traders start by trading currency pairs, trying later CFDs, stocks, and futures. Today I will be talking about the latter ones.

A futures is a contract between the seller and buyer by which they agree to sell/buy the asset in the future for a set price. Initially, such contracts were meant for companies, so that they could avoid unnecessary expenses.

Here is an example. We sell coffee yet we understand that due to the pandemic, the price for it will only be growing, and quite noticeably. To avoid a steep increase in the price and a decrease in sales, we agree with the supplier on a large supply of beans at the current price but in six months.

If the price for coffee indeed grows in the future, we will only win because we will buy the beans at a lower price. If the price does not grow and even fall, the one to profit from the trade is the seller because they will sell the coffee at a higher price than the current one.

Most often, base commodities for futures contracts are crude oil, wheat, corn, stock indices. Such contracts, as a rule, are trading in the exchange, and real supply of the commodity never happens.

Why are futures interesting to traders?

On the whole, futures contracts are somewhat different from, say, stocks. When an individual trader buys stocks, it is more like an investment, while trading futures is more of a speculation.

Simultaneously, thanks to this peculiarity, futures have certain advantages, unavailable for investments in the stock market. For example, futures are traded almost 24 hours a day six days a week, while shares have a limited trading time.

Another advantage of futures is easier margin requirements when selling than those to stocks. A short position in stocks means selling the asset that has been loaned and then buying this one for less money. For stocks, this trading operation has high margin requirements, while with futures, they are the same for selling and buying.

Futures also allow diversifying certain classes of assets and invest in them more actively.

For example, the share price of an oil company will depend not only on oil prices but also on the work of the management and rivals. However, a futures itself can depend only on the oil price without any factors created by the work of the company and its rivals.

How to trade futures, after all?

To work actively with futures, the trader needs to focus on a limited number of instruments to stay concentrated and accumulate experience. With futures, you can take long and short positions: the direction of the work depends on your tolerance to risk and your goals.

A long position means that you buy a contract and wait for the base asset to grow in the future. Then you sell it at a higher price and make money on it. Risks emerge from the base asset not growing or even falling – this way you lose your money.

A short position means that you sell your futures and wait for the price of the base asset to fall in the future. Here are also risks: if you are in a short position, and the price for the base asset grows, your losses can be unlimited because there are no limits to growth.

There is also such a notion as calendar spread. This is a strategy by which the trader takes both a long and short position in one asset with different delivery dates.

The potential profit emerges from the small difference between the sold and bought contract. If the calendar spread is positive, the trader buys a futures with a shorter delivery term and sells a futures with a longer one. If the calendar spread is negative, they sell the futures with a shorter delivery term and buy the futures with a longer one.

Read more at R Blog - RoboForex

Sincerely,
RoboForex team

Financial Reports of Companies: Main Reference Point for Investors

Author: Maks Artemov

Dear Clients and Partners,

When you are investing in the stock market, you need to account for various factors and data from companies that you will be basing your investment decisions on. One of the most important and complex indicators of success of businesses is the financial report. It helps predict further development of the company and decide whether its shares are worth putting your money in.

Companies that do not have their shares traded in the stock market may not reveal their reports to all those who are curious. On demand, they can provide this information to tax authorities or potential investors. However, only public companies must reveal their financial reports fully.

As a rule, reports are published in open sources or on the websites o companies. The reporting period that ends up in a financial report, can be a quarter, six months, or a year. In certain cases, companies provide reports for longer periods for the sake of clearance of analysis.

Types of financial reports

Internationally accepted practice offers several types of standard reports:

• IFRS – International Financial Reporting Standard

• US GAAP – US Generally Accepted Accounting Principles.

The latter standard is used by companies that have their shares traded in US stock markets.

As the name reveals, the IFRS is an international reporting standard. Quite often, the IFRS report is adjusted to the standards of US GAAP for simpler analysis.

How to use financial reports

Having studies financial reports of a company or several companies, an investor can carry out a comparative analysis of their business. This is quite a simple thing to do.

First, choose the companies you would like to compare, but make sure they are working in one sector or make similar products. It would be wrong to compare a company that produces heavy metals and an entertainment company. In such a case, comparison will be incorrect for a number of reasons.

Draw a table of the indicators you are interested in. Thus you can assess the perspectives of development and potential profit from investments. As a rule, for comparison previous reports of both companies are taken, and comparative analysis is carried out that, among other things, helps assess potential dividends and the market sustainability of the company.

If the results of a company are disappointing, hold back from investing in it. Promising companies with innovative products can be an exception, but never forget about increased risks.

Bottom line

There is no reason for an investor to study the whole of financial report. Reports can contain up to 200 pages and some information meant for a very small number of people.

An optimum way out is to choose several indicators and use only them. Note that you need to study the reports for the previous reporting period. To see the full picture, annual reports are usually used.

When making decisions, investors are often perplexed by impulsive statements or negative news about the company. In this case, it will be safer to act based on digits and facts instead of emotions.

Read more at R Blog - RoboForex

Sincerely,
RoboForex team

RoboForex: upcoming changes to the trading schedule in view of Martin Luther King Jr. Day in the US

Dear Clients and Partners,

We are informing you that due to the public holiday in the USA, Martin Luther King Jr. Day in the US, there will be some changes to the trading schedule*.

MetaTrader 4 / MetaTrader 5 platforms

Schedule for trading on CFDs on US indices (US30Cash, US500Cash, USTECHCash) and Japanese index JP225Cash

• 17 January 2022 – trading stops at 7:45 PM server time.

• 18 January 2022 – trading starts as usual.

Schedule for trading on Metals (XAUUSD, XAGUSD) and CFDs on oil (Brent, WTI)

• 17 January 2022 – trading stops at 7:45 PM server time.

• 18 January 2022 – trading starts as usual.

Schedule for trading on CFDs on US stocks

• 17 January 2022 – no trading.

• 18 January 2022 – trading starts as usual.

R StocksTrader platform

Schedule for trading on US stocks, CFDs on US stocks, and ETFs

• 17 January 2022 – no trading.

• 18 January 2022 – trading starts as usual.

Schedule for trading on CFDs on US indices (US500, US30, NAS100)

• 17 January 2022 – no trading.

• 18 January 2022 – trading starts as usual.

Schedule for trading on Metals (XAUUSD, XAGUSD) and CFDs on Crude Oil (BRENT.oil, WTI.oil)

• 17 January 2022 – no trading.

• 18 January 2022 – trading starts as usual.

cTrader platform

Schedule for trading on Metals (XAUUSD, XAGUSD)

• 17 January 2022 – trading stops at 7:45 PM server time.

• 18 January 2022 – trading starts as usual.

Please take note of the above trading schedule changes when planning your trading activity.

* - This schedule is for informational purposes only, and may be subject to further change.

Sincerely,
RoboForex team

How to Profit from Growing Uranium Prices?

Author: Eugene Savitsky

Dear Clients and Partners,

Market players already understand that in 2022, the QE monetary policy will be coming to an end, and the US Federal Reserve System will increase the interest rate.

This understanding makes investors every time less optimistic and sends stock indices down. For example, NASDAQ Composite (NAS100) has lost 4% since the beginning of the year, and S&P 500 (US500) – 1.5%. Dow Jones Industrial Average (US30) is the only one to withstand the troubles: its decline remains within 1%.

In such a market, do not hurry to buy even those shares that look promising. Their prices may fall even deeper down. However, we still need to look for efficient investment ideas. So, in this article I am driving your attention to the green energy sector and another one that is somewhat connected – the atomic energy sector.

Some history

Canada is a country with the largest territory in North America. The name of the country stands for “kanata”, which means “settlement, land” in the language of local Indian people. The history of Canada started in 1534 when a French seafarer Jacques Cartier explored the country. One of the first French colonies was founded on the territory of modern Quebec, initially populated by indigenous people.

Canada is a federative country that consists of ten provinces and three territories. As early as the 1850s, the country gave up the colonial Canadian pound and switched to the Canadian dollar. Traders also use a slang name “loony”, from “loon”, the name of the bird on the 1 dollar coin. This bird is a mascot o Canada. Since 1970, the CAD has been a free tradable currency; the monetary policy is regulated by the Bank of Canada, the Central Bank of the country.

The CAD is a popular currency that takes part in 3% of all trading operations of international trade. Many leading countries keep a part of their gold reserves in the CAD. Thanks to free conversion and good volatility, the CAD is one of the seven Forex majors.

Looking for clean energy

Renewable energy sources (sun and wind) cannot replace hydrocarbons yet because the humanity has not figured out how to store lots of energy for a long time.

Using solar and wind power, people become dependent on weather.
Meanwhile, hydrocarbons are more user-friendly and reliable, as well as economically efficient. However, it has a negative influence on the environment. Ecological concerns and the threat of global warming make people look for replacements for hydrocarbons.

Options are few:

• Solar energy

• Wind energy

• Sea wave energy

• Water energy

• Atomic energy

• Thermonuclear energy

Why we do not use thermonuclear energy

Thermonuclear energy is a dream of the humanity. First attempts to get electricity from thermonuclear reactions were made as long ago as in 1950. yet, scientists fail to achieve any satisfactory results: they still spend more energy on carrying out those processes than they get in the end.

This sector is developing actively anyway. A good example is the International Thermonuclear Experimental Reactor project, originating back in 1980. Nowadays, no one can confidently say when the dream will come true, while we need electricity every day, and the need for it is growing constantly.

The EU plans to consider atomic energy “green”

Some steps have already been made in this direction. On January 1st, the Euro Commission presented to member countries a draft bill where it is suggested to consider atomic energy ecologically clean. This means financing of nuclear energy plants construction at least until 2045.

Germany opposes constructing nuclear energy plants

Germany speaks against this project, referring to the consequences of nuclear power plants accidents. German government does not only speak against this project – it takes actions.

By January 1st, it had shut down three nuclear power plants, leaving just three more in the energy system of the country, that are also going to be shut down by the end of 2022.

Read more at R Blog - RoboForex

Sincerely,
RoboForex team

The Most Anticipated IPOs of 2022

Author: Vadim Kovalenko

Dear Clients and Partners,

Last week, we told you about the IPO of Justworks, the company that created the management accounting platform. Due to the current market situation, the underwriters decided to postpone the IPO to a more favourable period. The underwriters of other IPOs followed in their footsteps, that’s why today, we’ll talk about the most anticipated IPOs of 2022.

SDiscord, a messenger

The company was established in 2015 with headquarters in San Francisco, California. Developers decided to create a messenger for gamers with a wide range of free services – text, voice, and video chats. Users can communicate while playing without risking disconnecting. It’s particularly important for cyber athletes, who were indeed instrumental in the growth of Discord popularity.

The messenger is compatible with all operating systems, including Windows, macOS, and Linux. In addition to that, it can be installed on a mobile device. Discord’s key competitive advantage is that it can be used even with gaming consoles, such as Xbox and PlayStation. The messenger audience is over 140 million people all over the world.

Microsoft took interest in buying Discord but the acquisition didn’t happen. Now Discord intends to go public at the end of 2022. The preliminary estimate was made during the latest round of financing and amounted to about $15 billion.

Databricks, software for data analysis

In the last few years, large corporations tend to use data analysis for making management decisions. It resulted in the growth of demand for software intended for this purpose. In 2013, seven scientists from the University of California, Berkeley, founded Databricks. Its speciality is the development of software for BigData analysis.

According to BusinessWire, the global BigData analysis market is expected to reach $142.5 billion by 2024. As a result, the average annual growth rate could be 20%.

Databricks already has over 5,000 clients. Among them are such famous companies as Comcast and T Mobile. In 2020, the company’s revenue demonstrated 75% growth, up to $350 million. The revenue in 2021 is expected to pass $500 million. the company’s goal for 2022 is $1 billion in sales. Databricks capitalization is estimated at $28 billion. The exact IPO date hasn’t been announced yet.

Read more at R Blog - RoboForex

Sincerely,
RoboForex team

RoboForex is voted the Best Broker of the year by the Traders Union

Dear Clients and Partners,

we are proud to announce that RoboForex has conquered a new peak – in 2021, the broker won new awards from the International Association of Forex Traders in several nominations:

We’re sincerely thankful to our clients for their trust and confidence, and want to meet their expectations by providing the most transparent and favourable trading conditions. Assess them yourself:

Sincerely,
RoboForex team

How to Trade Piercing Pattern and Dark Cloud Cover?

Author: Victor Gryazin

Dear Clients and Partners,

Today the article is devoted to two patterns — the Piercing Pattern and Dark Cloud Cover — their forming and trading principles.

How do the patterns form?

The Piercing Pattern and Dark Cloud Cover are reversal candlestick patterns that predict a correction or reversal of the current trade

These patterns consist of two candlesticks each and mirror each other. The Piercing Pattern forms at the lows of the chart and forecasts a reversal upwards. The Dark Cloud Cover appears at the highs and warns of a decline beginning.

Speaking metaphorically, the emergency of the Dark Cloud Cover in a growing market shows that the bulls are stuck in a serious obstacle, and if they fail to overcome it, a downward correction will follow. And vice versa: if after a market decline the Piercing Pattern appears, the bears are losing the grip, and the bulls are optimistic about an upward reversal.

Dark Cloud Cover

Japanese traders state that this pattern in the chart gives little chance for further growth. The pattern consists of two candlesticks, a white and a black ones.

At the white candlestick, the market is growing actively, and a new local high is set. Thanks to the optimism and the pressure applied by buyers, the next trading session opens with a gap upwards. But then the market falls, and the black candlestick closes in the middle of the body of the white one or even lower.

As a result, the optimism of the bulls reflected in the white candlestick gets fully destroyed by the black candlestick. The bears have managed to recover, stop the bulls, and are ready to fight back.

The farther the closing price of the black candlestick reaches behind the preceding white one, the stronger this signal is considered. The signal can be canceled by the growth of the price above the high of the pattern.

Closing thoughts

The Piercing Pattern and Dark Cloud Cover form in a downtrend or an uptrend, respectively. They predict a reversal of the current trend.

Trading by these patterns can be augmented by tech analysis and indicators. In more details, this trading is described in a book called “Beyond Candlesticks: New Japanese Charting Techniques Revealed” by Steve Nison.

Read more at R Blog - RoboForex

Sincerely,
RoboForex team

How to Trade Hammer and Shooting Star Candlestick Patterns

Author: Victor Gryazin

Dear Clients and Partners,

Hammer and Shooting Star are two popular candlestick patterns. Appearing on the chart, they precede a correction or trend reversal. These two patterns form at the local extremes of the price chart after a lengthy movement.

Hammer

The Hammer pattern indicates a market reversal upwards and forms at the price lows after a descending price movement. The pattern looks like a candlestick with a small body and a long lower shadow, at least three times as large as the body.

The body of the candlestick closes near the highs, the upper shadow is tiny or lacking altogether. The candlestick may be of any colour, with or without a gap from the previous candlestick. A pattern with a white body will be a bit stronger. The candlestick resembles a hammer on a long handle, that is why the pattern got its name.

The Hammer only matters after a serious decline, when the market is oversold. In a downward movement, the bears bump at a strong support level that lets the bulls find a foothold and try to reverse the market upwards. The long lower shadow of the candlestick demonstrates the power of the bulls and their readiness to fight back.

If after the Hammer forms the bulls manage to hold the support level consisting of the pattern low and push the quotations upwards, renewing the high of the candlestick — then an upward correction becomes more possible, which means a good chance to buy. However, if the bears manage to drag the prices under the low of the candlestick, the signal to buy will be cancelled, so that the decline may continue.

Shooting Star

Shooting Star indicates a market reversal downwards, appearing at the highs of the price after an ascending movement. This pattern mirrors the Hammer: it consists of a candlestick with a small body and a long upper shadow, at least three times larger than the body.

The body closes near the lows, the lower shadow is small or totally lacks. The candlestick may be of any colour, with or without a gap from the previous candlestick. A pattern with a black body will be a bit stronger. This candlestick looks like a shooting star (a meteorite burning in the atmosphere) that leaves a long trail.

The pattern is significant only after a lengthy decline of the quotations, when the market is overbought. In an ascending movement, the bulls get stuck in a strong resistance level that gives the bears a chance to accumulate forces and push the price down. The long upper shadow of the candlestick demonstrates the power of the bears and their eagerness to reverse the market in their direction.

If after a Shooting star the bears manage to hold the resistance level formed by the high of the pattern, and push the quotations down, renewing the low — then the descending correction becomes more probable and a good chance to sale appears. However, if the bulls manage to raise the quotations above the high of the pattern, the signal to sell will be cancelled, and the upward movement may return.

Trading the Hammer and Shooting Star

As long as these two are reversal patterns, they are to be looked for on the local lows and highs of the price chart in a descending or ascending trend, respectively. These patterns are not recommended for flats except for the cases when they confirm bounces off the borders of the price range.

The patterns are good for trading shares, commodity futures, Forex currencies, etc. They work on larger timeframes by themselves and can be useful for trading intraday when applied alongside tech analysis.

Read more at R Blog - RoboForex

Sincerely,
RoboForex team

Divergence and Convergence in Trading: How to Use Signals

Author: Victor Gryazin

Dear Clients and Partners,

This article is devoted to such terms as divergence and convergence as well as their use in trading.

What is divergence

Divergence is the instance when the price chat diverges with the used trading indicator. This looks as follows: in an ascending movement the price chart forms a new high that is higher than the previous one while the indicator shows a high that is no higher than the previous one. This inequality might mean that the bulls are losing power, so next thing a descending correction or even a reversal follows.

A classic divergence consists of two highs of the price chart and two corresponding highs of the trading indicator. One of the most popular indicators for catching divergences is the MACD (Moving Average Convergence/Divergence).

How to use convergence and divergence in trading

A divergence or a convergence on the chart is considered a useful trading signal. Many traders fish for them to open or close their positions.

To catch convergences/divergences, various indicators can be used, the most popular of them being the MACD, RSI, and Stochastic. Convergences/divergences can be traded on any highly liquid assets, on timeframes from H1 and higher.

How to sell with divergences

When a divergence appears, it gives a signal to sell: the quotes set a new local high but the indicator does not confirm it. However, quite often signals from divergences go against the current trend, giving a good reason for closing profitable positions because a reversal becomes too possible.

As for opening new positions against the trend, here one needs to be extremely careful. Beginners should rather abstain from this. To open new positions, divergences during corrections are better. If there is a correction of a downtrend, and a divergence appears in the meantime, this is a good signal to sell. Positions should be open by the current trend

Example of selling by a divergence

• On H1 of GBP/USD in an ascending correction the MACD signaled about a divergence.

• After a local high formed and the price reversed downwards, a selling position by the trend can be opened.

• Stop Loss is to be placed behind the last high, and Profit can be taken as soon as a strong support level is reached.

Bottom line

Divergence and convergence stand for the process of diverging/converging of the price chart and the trading indicator. These are good trading signals used for opening and closing positions.

To make signals more efficient, the divergence/convergence should be used alongside other instruments of tech analysis. Before trading for real, practice on a demo account.

Read more at R Blog - RoboForex

Sincerely,
RoboForex team

How to Use Standard Deviation Indicator in Trading

Author: Victor Gryazin

Dear Clients and Partners,

Today the article is devoted to the Standard Deviation indicator. It helps evaluate the dynamics of volatility of a financial instrument and find promising entry points.

What the indicator shows

Standard Deviation (STDev) is a trading instrument that shows how far the price of a financial instrument deviates from standard values of a certain period. It shows the deviation from a Simple Moving Average and thus helps to assess the change in the price volatility.

The indicator conditionally belongs to trend ones: when it grows, this might mean the beginning of a new market trend. The higher the volatility and the more the price fluctuates from the average over the chosen period, the higher STDev values will be. And vice versa: if the quotes are stable, trading in a narrow price range, indicator values will fall to the lows.

STDev can be used for trading on its own and alongside other indicators. Also, it is used inside more complicated indicators. For example, it can be found in a famous channel indicator Bollinger Bands: STDev helps to calculate the borders of the price range for the quotes.

Standard Deviation appears in a separate window under the chart and has just one main line. Its values start with 0 and always remain positive, i.e. never drop under 0.

The indicator does not show trend direction. The line will grow alongside the growth of volatility regardless of the market direction, equally when the quotes are growing and falling.

How to install Standard Deviation

Standard Deviation is built in the majority of popular trading platforms. To install it on the chosen price chart on the MetaTrader 4 and MetaTrader 5 platforms, go to the Main Menu. Your algorithm is: Main Menu – Insert – Indicators – Trend – Standard Deviation.

You can customize the following settings:

• Period is the period for which the indicator will be calculated. By default, it is 20.

• Apply to: choose the price that calculations will be based on. By default, it is Close.

• MA method is the calculation method for the MA. By default, it is Simple.

• Style sets the appearance of the line. You can change its color, width, and representation method.

Calculating Standard Deviation

To calculate the indicator, use the following formula of statistic average square deviation:

Standard Deviation = Sqrt (SUM ((CLOSE - SMA (CLOSE, N)) ^ 2, N) /N)

Where:

Read more at R Blog - RoboForex

Sincerely,
RoboForex team