Accumulative Swing Index indicator (ASI) is used by traders to gauge the long and short term trends of the price of a stock over a specific period of time. The ASI indicator tends to project real market condition, the indicator resembles the true price themselves helping the trader to understand the real market scenario. The indicator also helps to identify classic support resistance levels. The indicator also has the inherent characteristics of identifying short term swing points and also shows the real price trends. Zerodha Kite charts plot this indicator for traders.
How to set up ASI indicator in Zerodha Kite?
- Go to MarketWatch.
- Choose the stock you are going to trade.
- Right click on the stock and select chart from graphic icons.
- Chart window of the stock opens.
- Go to studies. Select studies.
- Go to Accumulative Swing Index and click on it.
- A small window opens with default parameters of the indicator.
- Once the parameters are selected the Done command is chosen, the parameters window goes off the screen and the indicator is plotted on stocks price.
- Enter the trade if the swing index is at the bottom.
- Exit trade if the swing indicator has reached its topmost value or thereabouts.
ASI indicator in intraday –
- The indicator works well in all time frames.
- The picture above shows State Bank of India (SBIN) stock price movement with respect to swing index indicator.
- The chart shows 1 min. timeframe.
- A short position is created when the swing indicator reaches its highest value or near it.
- The accumulative swing index indicator (ASI) shows the price trend. Understanding price trend from ASI is important before creating a position.
- The short position is closed when the swing index retraces after reaching the bottom.
- A fresh buy position can also be created if the swing index goes up after touching the bottom.
Partha, an engineer by education, is theoratically actively following the stock and commodity markets since 1990. He is an active trader since 2003. He has received formal education in future and options and quantum analysis. He is presently working on research oriented projects using Python and data analytics.