Technical Analysis

Technical analysis evaluates stocks using charts and other tools to pin down patterns that suggest future market activity. Charts are still charts regardless of market conditions. In times of high volatility, the pattern is merely down trending. A pattern which took weeks to trace out in low volatility times can take only hours or days to move in a highly volatile market.

If you're a a trader, chances are you're using technical analysis to analyse potential stock. Interpreting charts can be confusing, and not mention a steep learning curve for a newbie. But they can very helpful in studying the movement of a particular stock. There are no guarantees in the stock market but indicators can at least steer you in the right direction. With the different indicators out there which do you use?

Technical Analysis - The Basics:

There are various methods in navigating the stock market. Even though it can be very unpredictable there are tools that you can use to help you gain insight on a particular stock that grabs your interest. One of the main methods in evaluating stock is technical analysis. This is used by traders to analyse the supply and demand of stocks in the market to determine their trend. The trend provides the traders signals on how the stock price will behave in the future. This can be very convenient in a highly uncertain market that enables traders to be one step ahead of the game.

Stock trading beginners often wonder if they should be using technical analysis or fundamental analysis. The first question you should be asking is whether you are going to be an investor or a trader of stocks. There is a fine line between an investor and a trader.