John Jacques's Avatar
John Jacques
published in Blogs
Mar 22, 2018
A.I. Stock Market Predictions: Head & Shoulders

A.I. Stock Market Predictions: Head & Shoulders

Statistics for the Head-and-Shoulders Bottom Pattern

The days where only hedge funds used algorithms to trade stocks are officially over.

Now retail investors can use Artificial Intelligence (A.I.) to find patterns in the markets and to make trades based on ideas generated by algorithms. If the A.I. discovers a pattern and makes a prediction on where the price of a stock is headed, the investor could potentially capitalize (if the A.I. is correct).  

Here’s an example of the algorithm in action:

Late last year, Tickeron’s A.I. discovered a Head-and-Shoulders Bottom Pattern for a stock that everyone knows: Facebook (FB). As you can see in the chart above, the algorithm scanned Facebook’s price movements last summer and followed the price as it formed a Head-and-shoulders Bottom pattern from late August through October 7. The pattern is marked by points 1 through 5. Once FB hit the “Breakout” price of $172.19, Tickeron’s A.I. predicted the price would hit $181.51. If you were a subscriber to this pattern on Tickeron.com, you would have received the A.I.’s prediction right in your inbox! Then it would have been up to you to make a trade based on the predicted target price.

A subscription to Tickeron’s Pattern Search Engine would have also given you access to a Head-and-Shoulders Bottom Pattern for a blockbuster stock that many retail investors own already: Apple Inc. (AAPL). The A.I. would have told you that the breakout price for the stock was $161.02 and that it expected the stock to jump to $172.64.

In just a few days, Apple’s stock did just that, marked by “Success” on the chart below:

How Effective is Tickeron’s A.I.?

Any reasonable investor or trader would say, “Ok, this looks great on paper. But how effective is Tickeron’s A.I. at making these predictions? Where are the statistics?”

See below. In instances where the A.I. was more than 20% confident that the price of the stock would move at least 5% higher to its target price, the A.I. was right more than 58% of the time. That’s a solid metric.

Another solid metric? When Tickeron’s A.I. was right, the average return on the trade was +12.05%:

Statistics for the Head-and-Shoulder (Bullish) Pattern

Ready to Start Trading?

The Head-and-Shoulders (Bullish) pattern is formed when a stock price creates a trough (point 3) with two inverted “shoulders” (1, 5). The pattern is formed when a stock is testing new lows on a downtrend. After reaching the lowest low (the Head, 3) the next low is shallower and the trend reverses course to the upside.

This type of formation happens when investors create a minimum support level for a stock price, and ultimately trading consolidates into an uptrend.  

To trade the pattern, an investor has to watch out for the Breakout Price, which Tickeron’s A.I. will do for you. Once the stock price breaks out from the top pattern boundary (the neckline), day traders and swing traders might consider buying the stock or a call option — hopefully riding it up to the target price.

If pattern trading is new to you, perhaps a great way to get started is through a free trial of Tickeron’s Pattern Search Engine. For 45 days, you can see how the algorithm works and how you can potentially use it to make smarter trades.

For experienced investors still not using algorithms to help you trade, what are you waiting for?! Get started today on tickeron.com.

 

Related Tickers: AAPL
Sergey Savastiouk's Avatar
Sergey Savastiouk
published in Blogs
Mar 07, 2021
4 Tricks Hedge Funds Use to Get Ahead

4 Tricks Hedge Funds Use to Get Ahead

If the stock market were Major League Baseball, hedge funds and institutional investors would be the pros on championship teams while everyday self-directed investors (SDIs) are the benchwarmers in the minors.It’s how they get ahead, and it’s why 90% of SDIs lose money trying to play (invest and trade) in the major leagues. The 4 tricks we discuss below are rooted in one common theme: they all use Artificial Intelligence and algorithms to generate data and ideas.
John Jacques's Avatar
John Jacques
published in Blogs
Mar 22, 2018
A.I. Stock Market Predictions: Head & Shoulders

A.I. Stock Market Predictions: Head & Shoulders

Statistics for the Head-and-Shoulders Bottom Pattern The days where only hedge funds used algorithms to trade stocks are officially over. Now retail investors can use Artificial Intelligence (A.I.  Here’s an example of the algorithm in action: Late last year, Tickeron’s A.I.
Sergey Savastiouk's Avatar
Sergey Savastiouk
published in Blogs
Jul 10, 2020
3 Stocks to Buy if Coronavirus Second Wave Hits

3 Stocks to Buy if Coronavirus Second Wave Hits

By analyzing market trends from the first wave, you can predict behavior for the second. Technology stocks have performed at historic levels this year, but the market is severely overbought.To compensate for that, look at performance during Q1 and Q2, the height of global Covid shutdowns.
Edward Flores's Avatar
Edward Flores
published in Blogs
Feb 06, 2021
How to Become the Millionaire Next Door

How to Become the Millionaire Next Door

The Golden Gate Bridge is always a fixture of these walks too, one of man's most beautiful creations.  As we were walking, at one point she turned to me and said, "Man, I'll never have a million dollars."" My girlfriend is 27 years old and works as a graphic designer, making about $75,000 a year.
Alla Petriaieva's Avatar
Alla Petriaieva
published in Blogs
Feb 23, 2021
Is Ethereum’s Bomb about to Explode?

Is Ethereum’s Bomb about to Explode?

Ethereum’s software is set for an update in October.Until it is finished, participants in the Ethereum blockchain must determine how to delay the difficulty bomb – code that necessitates a steadily increasing amount of computer power to mine blocks and unlock rewards – that is already in place.
Sergey Savastiouk's Avatar
Sergey Savastiouk
published in Blogs
Aug 07, 2018
When Is the Next Recession Coming?

When Is the Next Recession Coming?

However, we also know that economists predicted 22 recessions out of 11 that took place since 1945. Are there real recession signs we should watch for?Indeed, the answer is yes, and here are a few very important ones: The first one is almost obvious and known to everyone – it is the Fed.
Abhoy Sarkar's Avatar
Abhoy Sarkar
published in Blogs
May 22, 2020
Central banks have been buying $2.4 billion in assets every hour for the past two months

Central banks have been buying $2.4 billion in assets every hour for the past two months

Some $17.8 billion has been poured into  bond markets over the past week, the biggest move in more than three months.Around $3.5 billion has been invested into gold, the second largest on record. 
Rick Pendergraft's Avatar
Rick Pendergraft
published in Blogs
Feb 07, 2021
Mid-January Short Interest Report Shows 8 Stocks with Good Fundamentals and High Short Interest
Sergey Savastiouk's Avatar
Sergey Savastiouk
published in Blogs
Mar 10, 2021
How to Start Trading Penny Stocks

How to Start Trading Penny Stocks

Penny stocks have long been marginalized within the professional investment community, oftentimes being painted with a broad brush of simply being “too risky.” Leonardo DiCaprio’s depiction of the penny stock peddling conman, Jordan Belfort, in the Wolf of Wall Street certainly didn’t help.Here are four reasons to start trading them now. Reason #1: Let’s State the Obvious -- Penny Stocks are Cheap A single share of Apple Inc. costs over $350.
Abhoy Sarkar's Avatar
Abhoy Sarkar
published in Blogs
May 08, 2020
US unemployment rate jumps to 14.7%, the highest in series history

US unemployment rate jumps to 14.7%, the highest in series history

The U.S. economy’s employment fell by -20.5 million in April. The coronavirus crisis led to unemployment rate soaring to 14.7% in the U.S, the highest rate in the Bureau of Labor Statistics-tracked series history that goes back to 1948. However, the figures were better compared to several economists'/analysts' forecasts of 22 million job losses and 16% unemployment rate.  Another unemployment measure that includes those who have stopped looking for work as well as those holding part-time jobs for economic reasons also touched an all-time high of 22.8%.
SUMMERSALE79% OFF