The Secret to Technical Analysis
There are many experts and books telling you how to pick stocks. You can turn on the TV and you are going to get a stock recommendation if you watch financial news. But most people never tell you when to buy or sell.
You see you have to do more than just get an idea from TV or read about a hot stock in a magazine to make money. You have to know basic trading tactics and fundamentals and put them to use. That is where understanding price action and stock charts comes in.
There are three key things you need to know when it comes to charts and technical analysis. First you must understand that the price of a stock is already factoring in the future. A stock is high because people think the future is good and low when they think it is bad. So if you want to make money based on that you are trying to outsmart the entire world.
The second principle is that prices move in trends. There are predictable trends that repeat over and over again that you can take advantage of. The trader's mantra is "the trend is your friend."
The reason why technical analysis works is because investors will never change. Throughout history they have been driven by fear and greed and always will be. There always will be people who buy at tops and sell at bottoms and you just need to know the patterns that show you when important turning points are at hand.
The key is to distinguish important trends from meaningless short-term fluctuations in the stock market. That is why you want to combine some sort of fundamental analysis with technical analysis. You want to use price charts as a tool.
The whole secret to investing is to get your emotions out of it as much as possible. Most people by because they fear missing out on more gains and sell when they let losses pile up and can't take them anymore. You just need to make rules to let your winning positions run and cut your losing positions quickly so they won't eat up your account balance.
It is all about learning and planning. You do those two things and you can make money in the stock market. Most investors don't and that is why most investors don't make a whole lot of money in the stock market or are just at average. You can do better if you just take action for yourself. - 23196
You see you have to do more than just get an idea from TV or read about a hot stock in a magazine to make money. You have to know basic trading tactics and fundamentals and put them to use. That is where understanding price action and stock charts comes in.
There are three key things you need to know when it comes to charts and technical analysis. First you must understand that the price of a stock is already factoring in the future. A stock is high because people think the future is good and low when they think it is bad. So if you want to make money based on that you are trying to outsmart the entire world.
The second principle is that prices move in trends. There are predictable trends that repeat over and over again that you can take advantage of. The trader's mantra is "the trend is your friend."
The reason why technical analysis works is because investors will never change. Throughout history they have been driven by fear and greed and always will be. There always will be people who buy at tops and sell at bottoms and you just need to know the patterns that show you when important turning points are at hand.
The key is to distinguish important trends from meaningless short-term fluctuations in the stock market. That is why you want to combine some sort of fundamental analysis with technical analysis. You want to use price charts as a tool.
The whole secret to investing is to get your emotions out of it as much as possible. Most people by because they fear missing out on more gains and sell when they let losses pile up and can't take them anymore. You just need to make rules to let your winning positions run and cut your losing positions quickly so they won't eat up your account balance.
It is all about learning and planning. You do those two things and you can make money in the stock market. Most investors don't and that is why most investors don't make a whole lot of money in the stock market or are just at average. You can do better if you just take action for yourself. - 23196
posted by X - Men @ 2:34 AM
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