Published By TradeSmith Customer Success
The Health Indicators act as a full life cycle indicating the health of your positions. They are designed to tell you at a glance exactly where any position stands relative to TradeSmith’s proprietary algorithms.
These signals indicate the current health of the position (performing well, in a period of correction, or stopped out).
The Health Indicator will tell you one of five things:
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Indicates the position is performing well and has not corrected below its recent high. If a position has not yet hit this price, it appears to be on an uptrend. |
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The position pulled back into the Yellow Zone but is still trending upwards. This indicates that the position has corrected somewhat below a recent high. It has not yet hit its stop price. |
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The position pulled back into a Yellow Zone and is moving sideways. The position has corrected somewhat below a recent high. It has not yet hit its stop price. It isn’t trending upwards nor downwards. |
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The position pulled back into a Yellow Zone and is trending downwards. This indicates that the position has corrected somewhat below a recent high; it has not yet hit its stop price but is moving downward. |
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The position has hit its Stop Loss and is now in the Red Zone. This indicates that the position has corrected more than its VQ% below a recent high. The position is not behaving in a way that is usual based on its historical market trend. |
The Health Indicators are designed to give you a quick indicator of the current performance trend for a given position. Based on this indicator, you may consider whether you wish to continue to buy, hold, or sell a particular stock. TradeSmith does not provide investment advice or recommendations with respect to buying, holding, or selling a particular asset, and you are solely responsible for making your own investment decisions. Investing involves substantial risk. TradeSmith does not make any guarantee or other promise as to any results that may be obtained from using the Health Indicators.
How Health Indicator Alerts Are Triggered
If the position has already moved more than its VQ% below a recent high, the Stop Loss will trigger. It’s an indicator that the position has corrected more than what is normal for the position. It means to take caution.
Below are the Health Indicator icons. They give you an at-a-glance idea of where any position stands relative to its current Stop Loss, Yellow Zone, and Green Zone conditions.
*Note please keep in mind that a stock needs at least 521 public trading days for a Health Indicator to be calculated. A cryptocurrency needs at least 150 public trading days for a Health Indicator to be calculated. Options do not have Health Indicator data.
*Note - The tabs and features you see on your TradeSmith Finance site will vary based on subscription(s) and subscription level(s). Pictures in our Education Center articles are taken from a TradeSmith Platinum account.