Technical analysis software

Technical analysis software automates the charting, analysis and reporting functions that support technical analysts in their review and prediction of financial markets (e.g. the stock market).

Features

The following are the most common features of technical analysis applications. Some software may focus on only one aspect (say back testing) and the combination of more than one software package is often required to build a fully automated trading system.

Charting

A graphical interface that presents price, volume and technical analysis indicators through a variety of visual interfaces such as line, bar, candlestick and open-high-low-close (OHLC) charts. The chart data is presented as a time series and users typically have the ability to view historical data with varying interval (sampling) periods. Interval periods range from seconds through to months; short term traders tend to use frequent interval periods, such as 1 minute i.e. the price data is updated every 1 minute, whereas longer term traders tend to use daily, weekly or monthly interval periods when trying to identify price and technical analysis trends. Some charting packages enable users to draw support and resistance trend line or for example Fibonacci retracements to help establish trending patterns.

Back testing

Enables traders to test technical analysis investment timing strategies against historical price movement for one or more specific securities. Strategies are compared to each other using diverse performance measurements such as maximum drawdown, annual profit and Sharpe ratio. The objective is to try and develop a trading strategy based on technical analysis indicator criteria, which will generate a positive return. This concept was computerized and introduced to traders by Louis B. Mendelsohn in 1983 with his ProfitTaker Futures Trading Software (see August 2010 issue of Stocks, Futures & Options Magazine).

Optimization

A process of testing technical analysis indicator parameters, with the view to developing an investment strategy that generates the maximum return based on historical price movement. The optimization process is achieved through the fine-tuning of the associated technical analysis charting parameters. Typically technical analysis indicators have a range of parameters that can be adjusted, such as the interval period and the technical analysis indicator variables. For example, the stochastic indicator has four parameters that effect its results: %k, %d, slowing period, interval period. Optimization must be performed carefully to avoid curve fitting. Back testing of an over-optimized system will perform real-time. One way to diminish over-optimization is by carrying out optimization on historical data and then performing future testing (sometimes referred to as 'out of sample') before making a final evaluation of a trading strategy.

Scanner

Scanners enable users to 'scan' the market, be it stocks, options, currencies etc., to identify investment opportunities that meet a user's specific investment criteria. Using a technical analysis scanner, a user could, for example, scan the market to identify oversold stocks that have stochastic and RSI value of less than 20% and 30 respectively.

Alerts

Alert software is used to monitor specific equities, such as stocks, options, currencies, warrants, etc., and provide a notification of when specific price, volume and technical analysis investment conditions are met. As an example, a person who uses technical analysis might want to be notified when the RSI indicator rises above 70, followed by the price falling below its 20-day moving average; using alerting software the user will be able to create an alert, which will provide a notification of when the technical analysis investment conditions are met. When alert conditions are met, a notification is typically communicated via an on screen pop up or sent as an email, instant message or text alert (to a mobile phone).

Custom indicators

Most technical analysis software includes a library of de facto standard indicators (e.g. moving averages and MACD). Some software will also provide a mean to customize, combine or create new indicators. This is typically achieved with a proprietary scripting or graphical language.

Data feed

Technical analysis software is typically used with end of day (EOD), delayed or real time data feeds. EOD data feeds provide the end of day closing price for the given equity and is typically updated once a day at market close. Delayed data is typically delayed 15 to 30 minutes depending on the exchange and is the most commonly used data feed type. Real time data feeds provide tick by tick 'real time' data. Real time data is licensed on a per-exchange basis whereas delayed data is typically purchased on a regional basis, such as US markets, rather than an exchange basis.

Broker interface

Some technical analysis software can be integrated with brokerage platforms to enable traders to place trades via a user interface that they are familiar with. Typically these software providers try to differentiate themselves from the brokerage software through enhanced features such as automated trading.

Platforms

Technical analysis software is available in the form of commercial or open source software. Such software may be available on a computer, or on a mobile phone or personal digital assistant (PDA). Mobile phones and PDAs allow a user to access online technical analysis packages when away from their computer. However, packages that require the use of Java applets may not work on older model mobile phones or PDAs. Online technical analysis software packages provide access from any Internet-connected computer (including a suitably equipped mobile or PDA), but may require the user to store their information with the provider. Installed, downloaded software will only be available on the computers that the user has downloaded and installed it on.

Feature comparison of products

	Back testing	Optimisation	Scanner	Alerts	Built-in indicators	Custom indicators	Data feed	Broker interface	Automated Trading	Online	Mobile access	Open source	Mac OS	Linux
Advanced Get	No	No	Yes	No	Yes	No	Yes, Metastock format	No	No	No	No	No	No	No
AgenaTrader	Yes	Yes	Yes	Yes	Yes	Yes	EOD, Real Time	Yes	Yes	No	No	No	No	No
Altreva Adaptive Modeler	Yes	No	No	No	Yes	Yes	EOD, Real Time	No	No	No	No	No	No	No
Alphametrix MT4	Yes	Yes	No	Yes	Yes	Yes	Real Time	Yes	No	No	Yes	No	No	No
AmiBroker	Yes	Yes	Yes	Yes	~100	Yes	Real Time, Delayed	Yes	Yes	No	No	No	No	No
Aspen Graphics WebChart	No	No	No	No	94	No	Real Time, Delayed	No	No	Yes	No	No	Yes	Yes
Aspen Graphics Workstation	No	No	No	Yes	40	Yes	Real Time, Delayed	Yes	No	No	No	No	No	No
ATS Futures	Yes	Yes	No	Yes	Yes	Yes	Real Time	Yes	Yes	No	Yes	No	No	No
ATRADER	No	No	No	Yes	~50	No	Real Time, Delayed	Yes	No	No	No	No	No	No
Axial Finance	Yes	Yes	Yes	Yes	80	Yes	EOD, Real Time	Yes	No	No	No	No	Yes	Yes
beeTrader	Yes	Yes	Yes	Yes	Yes	Yes	Metastock format, EOD, Real Time, Delayed	Yes	Yes	No	No	No	No	No
Bloomberg L.P.	Yes	Yes	Yes	Yes	200+	Yes	Real Time, Delayed	Yes	No	Yes	Yes	No	No	No
CarryQuote	No			Yes	Yes	No	Real Time, Delayed	No	No	Yes	Yes	No	No	No
Channalyze	Yes	Yes	Yes	No	~50	Yes	EOD	No	No	No	No	No	No	No
ChartAlert	Yes	No	Yes		~100	Yes	EOD	No	No	No	No	No	No	No
ChartIQ	No	No	No	No	~80	Yes	EOD, Real Time	No	No	Yes	Yes	No	Yes	Yes
Chart Tool	No	No	No	No	11	No	delayed	No	No	Yes	Yes	No	No	No
ChartNexus	Yes	Yes	Yes	Yes	36	Yes	EOD	No	No	No	Yes	No	Yes	Yes
CQG	Yes	Yes	Yes	Yes	~220	Yes	EOD, Real Time, Delayed	Yes	No	No	No	No	No	No
DashBov	Yes	No	No	No	~2	No	EOD	No	No	No	No	Yes	Yes	Yes
EdgeRater	Yes	No	Yes	Yes	~100	Yes	EOD	No	No	No	No	No	No	No
End Game Investments	Yes	Yes	Yes	No	~250	Yes	EOD	No	No	Yes	Yes	No	Yes	Yes
Equities Lab	Yes	Yes	Yes	Yes	Yes	Yes	EOD with fundamental	No	No	Yes	No	No	Yes	Yes
Esignal 11	Yes	Yes	Yes	Yes	~200	Yes	EOD, Real Time	Yes	No	No	Yes	No	No	No
Eye in the Sky Trade Planning	No	No	Yes	No	200+	Yes	EOD	No	No	No	Yes	No	No	No
iGuideStocks	Yes	No	Yes		~25	Yes	Real Time	No	No	No	No	No	No	No
FinanceIQ	Yes	Yes	Yes	Yes	~80	Yes	EOD	No	No	No	No	No	No	No
FXGraph Premium	No	No	No	Yes	~8	No	EOD,Delayed	No	No	No	No	No	No	No
Gannanalyst Professional	No	No	Yes	No	Yes	No	Metastock format	No	No	No	No	No	No	No
GMDH Shell	Yes	Yes	No	No	Yes	Yes	Real Time, EOD, Delayed, CSV Reader	No	No	No	No	No	No	No
Insider TA	Yes	Yes	Yes	Yes	~5	No	EOD	No	No	No	No	No	No	No
	Back testing	Optimisation	Scanner	Alerts	Built-in indicators	Custom indicators	Data feed	Broker interface	Automated Trading	Online	Mobile access	Open source	Mac OS	Linux
Market Analyst Software	Yes	Yes	Yes	Yes	~160	Yes	EOD, Delayed, Real Time	No	No	No	No	No	No	No
Merchant of Venice	Yes	Yes	No		7	Yes	EOD	No	No	No	No	Yes	Yes	Yes
MetaStock	Yes	Yes	Yes	Yes	Yes	Yes	EOD, Delayed, Real Time	No	No	No	No	No	No	No
MetaTrader 4	Yes	Yes	No[1]	Yes	Yes	Yes	Real Time	Yes	Yes	Yes[2]	Yes	No	No	Yes[3]
MultiCharts	Yes	Yes	Yes	Yes	~250	Yes	EOD, Delayed, Real Time	Yes	Yes	No	No	No	No	No
NetTradeX	Yes	Yes	No	Yes	Yes	Yes	Real time	Yes	Yes	No	Yes	No	No	No
NexTick	No	No	Yes	Yes	~7	No	Real time (OpenTick), EOD(Yahoo)	No	No	No	No	Yes	No	No
NinjaTrader	Yes	Yes	Yes	Yes	~100	Yes	EOD, Delayed, Real Time	Yes	Yes	No	No	No	No	No
Smart Trader +	Yes	Yes	Yes	Yes	21	Yes	Real Time, EOD, Delayed	No	No	Yes	No	No	No	No
Optimal Trader	Yes	Yes	Yes	No	15	No	EOD, Delayed	No	No	No	No	No	No	No
Piggy Market Squeak	No	No	No	Yes	No	Yes	EOD	No	No	No	No	Yes	No	No
PhoenixAI	Yes	No	Yes	Yes	~115	No	Real Time, Delayed	No	No	No	No	No	No	No
ProRealTime	Yes	Yes	Yes	Yes	~100	Yes	Real Time, Delayed, EOD	Yes	Yes	Yes	Yes	No	Yes	Yes
Protrader	Yes	Yes	Yes	Yes	~60	Yes	Real Time, EOD, Delayed	Yes	No	Yes	Yes	No	No	No
QChartist	No	No	Yes	Yes	~50	Yes	EOD	No	No	No	No	Yes	No	No
Qtstalker	Yes	No	Yes		~130	Yes	EOD, Delayed	No	No	No	No	Yes	Yes	Yes
QuantShare	Yes	Yes	Yes	Yes	~100	Yes	EOD, Real-time	No	No	Yes	No	No	No	No
Recognia Technical Insight	No	No	Yes	Yes	~50	No	EOD, Real-time	Yes	No	Yes	Yes	No	Yes	Yes
Reliable Software's Falcon7	Yes	Yes	Yes	Yes	300+	Yes	EOD, Real-time	Yes	No	Yes	No	No	No	No
Seer Trading Platform	Yes	Yes	Yes	Yes	80+	Yes	EOD, Delayed, Real-time	Yes	No	No	Yes	No	No	No
Sierra Chart	Yes	Yes	Yes	Yes	~240	Yes	EOD, Delayed, Real Time, CVS	Yes	No	No	No	No	No	No
sgcTrader	Yes	Yes	No	Yes	~100	No	Real Time, Delayed	Yes	No	Yes	No	No	No	No
Spider Software	Yes	Yes	Yes	Yes	infinite	Yes	EOD,Real Time	No	No	Yes	No	No	No	No
	Back testing	Optimisation	Scanner	Alerts	Built-in indicators	Custom indicators	Data feed	Broker interface	Automated Trading	Online	Mobile access	Open source	Mac OS	Linux
Statmetrics	Yes	No	No	Yes	~30	No	EOD, Real-time	No	No	No	No	No	Yes	Yes
Stocker	No	No	Yes	No	13	Yes	Delayed	No	No	No	No	No	No	No
StockWrap	No	No	Yes		130	Yes	EOD, Delayed, Real Time	No	No	No	No	No	No	No
StrataSearch	Yes	Yes	Yes	No	~100	Yes	EOD	No	No	No	No	No	No	No
Tashash.com	Yes	Yes	Yes	No	~20	Yes	EOD	No	No	Yes	No	No	No	No
Technical Analyst Trader	Yes	Yes	Yes	Yes	~100	Yes	EOD, Delayed, Real Time	No	No	No	No	No	No	No
Telechart			Yes				EOD, Delayed, Real Time	No	No	No	No	No	No	No
TeleTrader Professional Workstation	No	No	No	Yes	200+	Yes	EOD, Delayed, Real Time	Yes	No	Yes	Yes	No	No	No
timetotrade	Yes	Yes	No	Yes	200+	Yes	Real Time, EOD, Delayed	Yes	Yes	Yes	Yes	No	Yes	Yes
Track 'n Trade	Yes	Yes	No	Yes	Yes	Yes	Real Time, EOD	Yes	Yes	No	Yes	No	No	No
Tradermade	Yes	Yes	No	Yes	~50	Yes	Real Time, EOD, Delayed, CSV Reader	No	No	Yes	Yes	No	Yes	Yes
TraderStar	Yes	Yes	Yes	No	40+	Yes	EOD, Real-time	No	No	Yes	No	No	Yes	Yes
Tradesignal	Yes	Yes	Yes	Yes	~170	Yes	EOD, Delayed, Real Time	Yes	Yes	Yes	No	No	No	No
TradeStation	Yes	Yes	Yes		~100	Yes	Real Time	Yes	Yes	Yes	Yes	No	No	No
VestraCharts	No	No	Yes	Yes	~30	No	EOD, Delayed, Real Time	Yes	No	No	No	No	No	No
Vogaz	Yes	Yes	Yes	Yes	150+	Yes	EOD, Delayed, Real-time	No	No	Yes	Yes	No	No	No
Wave59	Yes	Yes	No	No	35+	Yes	EOD, Delayed, Real Time	Yes	No	No	No	No	No	No
Wealth Lab	Yes	Yes	Yes	Yes	300+	Yes	EOD, Real-time	Yes	No	Yes	No	No	No	No
WinChart	No	Yes	Yes	Yes	~20	No	Delayed,EOD	No	No	No	No	No	No	No
	Back testing	Optimisation	Scanner	Alerts	Built-in indicators	Custom indicators	Data feed	Broker interface	Automated Trading	Online	Mobile access	Open source	Mac OS	Linux
XTick	No	No	No	Yes	~100	Yes	Real Time	Yes	No	Yes	Yes	No	Yes	No
Zorro Trading Automaton	Yes	Yes	Yes	Yes	~200	Yes	Real Time	Yes	No	Yes	No	No	No	No

References

1. Custom scanner apps can be loaded
2. New feature 2015/2016
3. Optimized to run under Wine