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Technical analysis using Heiken Ashi Stochastic: To catch a trend, use a HASTOC

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  • Smita Roy Trivedi

Abstract

The study develops a new technical analysis indicator, HASTOC, which reflects in a single number the likelihood of trend generation and momentum in the market. The indicator is developed using the basic characteristics of the Japanese Heiken Ashi (HA) candles. We backtest strategies using HA and HASTOC for three currencies, one index and one stock for three major time frames in each market and find that the strategies give consistent positive returns for select time frames and markets. The contribution of this study extends to the practical trading scenario and literature on technical analysis.

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  • Smita Roy Trivedi, 2022. "Technical analysis using Heiken Ashi Stochastic: To catch a trend, use a HASTOC," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 27(2), pages 1836-1847, April.
    • Handle: RePEc:wly:ijfiec:v:27:y:2022:i:2:p:1836-1847
    DOI: 10.1002/ijfe.2245
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    References listed on IDEAS

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    Cited by:

    1. Shangkun Deng & Zhihao Su & Yanmei Ren & Haoran Yu & Yingke Zhu & Chenyang Wei, 2022. "Can Japanese Candlestick Patterns be Profitable on the Component Stocks of the SSE50 Index?," SAGE Open, , vol. 12(3), pages 21582440221, August.
    2. Tchoudi, William, 2022. "Study of Heiken Ashi Candlestick for Noise Reduction," AfricArxiv phejd, Center for Open Science.

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