Use Technical Analysis to Know When to Buy or Sell Stocks
When it comes to stocks, they always tell you to buy low and sell high, but how do you determine that point? I use what is called a technical analysis. With a technical analysis, you can determine with some measured degree of certainty where those point are. If you are buying a stock, it will give you signals as to when to buy. When selling a stock, it will also give you signals when to sell.
I have created a video that is part of this article that describes in very simple, but comprehensive terms how to use the three indicators that I use. They are; volume, stochastic, and Moving Average Divergent Convergence (MACD). Don't let these names scare you. Believe me, after viewing this video you will see how easy it is to use these indicators. They are not rocket science.
After viewing this video, you will learn the following:
- The difference between a fundamental analysis and a technical analysis
- The difference between income stocks and growth stocks
- How to use the Volume, Stochastic, and MACD to give you signals when to buy and sell stocks.
One Year Chart of Dow Jones Industrial Averages (12/5/2018)
The below chart shows the Dow Jones for a one year period of 2018. The "head and shoulder formations" are highlighted in yellow. As you can see 2018 has been a very tumultuous year for the stock market. Following every head and shoulders, there has been a significant downturn in the Dow.
© 2012 Mike Russo
Comments
AUTHORI wrote this article five years ago, but it is still relevant today. I updated it to include a chart on Head and Shoulders formations for the Dow 2018.
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- AUTHOR
monicamelendez: Fundamentals will give you the health of a company. Techncial analysis tells you when to buy or sell the stock in that company. I hope that helps and good luck in your investment strategy.
I'm all about the fundamentals but I've been trying to learn more about this side of things. Thanks for the advice
- AUTHOR
Thanks Brett for stopping by and thanks for all the useful hubs you share.
Great advice, the video is a really good idea for this topic, I will have to check it out and can play it with sounds ...
SOCIALLY SHARED for the budding traders amongst us. Voted up and useful.
- AUTHOR
falcone, thanks for the comments. I also want to do one on fundamental analysis, but it's a bit more involved. Thank you for SHARING
Excellent hub topic. I use technical analysis as well and strongly agree it is a useful tool. Voted ^ & useful.
Thanks For SHARING
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