Introduction
Lots of investors try to invest in stocks, hoping for big profits and great incomes. While it is possible to win some serious money from this initiative, you should know that the incomes are not guaranteed, and that there is a possibility for you to lose on this market. There are many secrets involved in stocks trading, and those secrets must be known before you get involved in this initiative.
History
It is important to have the necessary notions for technical analyze is important to determine the evolution of stocks on the short term. However, those techniques must be combined with some techniques of analyzing the evolution of stocks on the long term, and for this, you will need to know how to interpret the signs of the market. While the technical analyze is great in stocks trading on short term, as the movements of the stocks prices are anticipated intra day, the analyze of the state of economy and of the evolution of the industry is important for people that want to be involved in stocks trading on the long term.
There are many examples of investors that traded stocks without any knowledge about the respective stock, but those are only exceptions. The truth is that you can’t survive in stocks trading if you are not able to anticipate the moves on the market, and if you can’t use the graphs and charts in your advantage.
Features
The technical analyze is a great instrument, but it is more effective when it is combined with the Fundamental analyze. With the help of the charts, you will be able to determine the maximum and minimum price of a stock during a day, and to place your orders accordingly. The advantage of using the graphs is the fact that you will have access to complex information about the characteristics of a stock. There are different types of charts used by traders in stocks business, and all of them have their advantages and disadvantages.
The candlestick is a type of graph that is used for hundred years. it was first used in Japan to analyze the prices on the rice market several centuries ago, and it was adopted in stocks trading also. the traders have different feelings about those graphs. Some of them get in love with the candlesticks, using them for all their trading processes, while others would consider them as useless. one of the characteristics of those graphs is that they generate patterns that are easily recognized.
Tips and comments
Other traders prefer the “point and figure” charts that are used to record the variations of prices during a day. however, this type of chart is hard to make on a long term, but it has its advantages, as you can see the small variations of prices in stocks that are so important for short-term trades.
Of course, those are only a part of the graphs used in stocks trading, and the advanced traders are able to use all those methods in their advantage in order to obtain profits for their clients.
