Entrepreneurship on the Financial Markets Based on the Selected Indicator Technical AnalysisProceeding: 5th International Conference on Innovation Management, Entrepreneurship and Sustainability (IMES)
Publication Date: 2017-05-22
Authors : Andrea Kolková;
Page : 426-435
Keywords : Parabolic Stop and Reversal indicator; FOREX; Digital Option;
Entrepreneurship on the financial markets is currently associated with a lot of innovations. Financial managers are not limited in cash flow planning only by traditional instruments such as stocks or bonds. For effective use of modern tools, it is necessary instruments to predict courses. Possibility is a technical analysis. The aim of this paper is the application of the Parabolic Stop and Reversal indicator on today's FOREX and detection whether prediction of growth or decline of the currency pair according to this indicator is effective, so it could be used for more efficient planning of entrepreneurial finance.Design/methodology/approach: EUR/USD currency pair has been chosen for the analysis. The currency pair will be tested at the selected time frame form. The effectiveness of selected technical Parabolic Stop and Reversal indicator will be tested with the use of digital options.Findings: Paper evaluates the effectiveness of selected technical indicator. It applies theoretical knowledge about the Parabolic SAR indicator on the FOREX market and in particular on the EUR/USD currency pair. The result is, whether the number of profitable trades made under the impetus of the trading system based on this indicator is greater than the number of losing trades in a given time frame.Research/practical implications: In the case of confirmation of the effectiveness of this indicator it is suitable for practical applications in trading FOREX. In subsequent research, it is possible to verify whether this indicator is also usable on other contemporary markets, such as equity markets, futures. Entrepreneurs and the traders can use this tool to manage their available funds. Originality/value: Researches focus primarily on well-known indicators as weighted averages or MACD. Parabolic SAR indicator is in theory generally poorly described and defined. Today, it is increasingly difficult to store the available funds efficiently and therefore may benefit from any new tools for the structure of entrepreneurial finance.
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