How to do Stock Trend Analysis

By Brian Berry

I remember well enough what it was like trying to get started with Stock Trend Analysis. The learning curve was torturing on occasion. It seems no matter what I studied, I didn't understand quite enough to put it into practice. Over time with some serious tenacity I became good at enough to start earning some real money in the stock market.

My own major hurdle to gaining skill was there are so many well meaning people willing to extend advice and so many resources online for technical descriptions of several indicators, but nothing I found seemed to help me realize how all these indicator definitions and macroeconomic information fit in concert to forge a decent understanding of technical trading. I imagine I can save you some time and tons of frustration with this convenient little introduction.

An overview of technical analysis.

I figure if you are interested in technical analysis sufficiency to read this far, you are already acquainted with how the stock market functions and how to purchase and trade stocks. I hope so because it is an obvious prerequisite. Keep in mind this is an conversational overview of the learning path many traders, myself included have taken to understand Technical Analysis.

Technical Analysis - Fundamental Topics. What is Technical Analysis? For the unaware, there are two ranking sorts of Stock Analysis.

Technical and Fundamental Analysis Although the two are not contradictory, traders tend to favor one over the other. Fundamental Analysis looks at a company s assets, debt, earnings and cash flow. It gives the analyst a clear characterization of a company's health. When an analysis of one company is equated to its equals (groups of companies in the same business) it presents hints about possible failings and strengths of the company. Its also usable in assessing a company's overall prospects for growth.

Technical Analysis looks to take advantage of the mass knowledge of open market participants (other traders) who are by-and-large Fundamental Analysts. Technical Analysis is at its heart an analysis of supply and demand. So, lets discover precisely how Technical Analysts use the market as their guide on trading markets.

A Casual Technical Analysis Example: Price Speaks Volumes To begin, know that Price and Volume are both technical indicators. Price being naturally the chief indicator over any other. Each time a stock price moves up it signals a vote of confidence by all players. Sellers stood firm for a higher price than the predominating rate and buyers intervened and purchased at that price anyway. Sellers holding out for more money while buyers step in to pay the difference between the market and asking price shows market optimism.

Volume is the amount of shares traded over time. Technical traders look at price and volume together to estimate how optimistic or bearish buyers and sellers are and possibly are becoming. An increase in volume across a given time-frame indicates increasing involvement and hence conviction that prices will go on to travel in the ongoing direction. Whereas, when volume starts to decline it is an indicator that market participants are losing their strong belief that prices will remain in their current direction.

When volume is increasing along with prices, participants expect prices to proceed to rise. Technical traders hypothesize that prices will increase so long as volume is stronger than normal. If prices continue to mount while at the same time volume starts to drop, the participants are voting with less shares. This circumstance is a variety of technical breakdown.

Typical Volume Based Price Breakdown. One more phenomenon to think about is that once price direction varies, volume may begin to increase, once again supporting the conviction of market players of the new price direction. When an indicator such as volume starts to jibe with the price direction, this is known as a kind of price confirmation.

Technical Analysis Indicators Apart from the simple indicators of price and volume, there are infinite indicators and more are produced every day. An indicator can frequently be something as simple as a moving average or far more complex involving long formulas. As you've seen already, indicators are an operative part of understanding and anticipating market action. All technical analysis indicators fit two different classes.

It is important to remark that market circumstances prescribe which form you will use, but never brush off price. Indicators are predictors, but price speaks volumes, only prices are reality.

Leading indicators are used in sideways markets. Leading indicators react before price does. Most leading indicators set about to demonstrate changes in the strength or force of price direction, or momentum. Leading indicators are useful to help traders anticipate price movements because they can establish the strength or weakness of prices at their current level. Leading indicators do not do well as buy/sell indicators in steadily trending markets (up or down) because they indicate changes in momentum. They do well in sideways markets and give traders accurate signals about when to buy or sell.

Some usable leading indicators include Momentum, Stochastic and the Relative Strength Indicator (RSI). The RSI (leading indicator flags the overbought condition).

Lagging Indicators / Trend Following Indicators Use in trending markets (moving up / moving down).

Lagging indicators follow price moves. A moving average is a simplified kind of lagging indicator. Lagging indicators are frequently employed when the markets are in a very strong trend. They rapidly show traders the average direction of a stock price. They can send erroneous signals in markets that are trading at parity / proceeding sideways. Their optimal use is in trending markets because they can clearly show traders when to enter and how long to remain.

The most popular lagging Indicators include Moving Average, Exponential Moving Average and Moving Average Convergence Divergence (MACD) The moving average is a Trend Following Indicator.

Technical Analysis Understanding time frames. In Technical Analysis, indicators are insignificant without understanding them in the context of time. Indicators, leading and lagging both use time and price as the very basis of any formula. It may help to consider time frames as magnification of detail. If you consider a one year weekly chart and zoom into a one year daily chart, you are straightaway aware that you can see price action in deeper detail. Likewise traveling from a one year daily chart to a three month daily chart affords even greater detail of the price activity.

More about time frames in technical analysis: Screening multiple time frames exposes greater detail.

What kind of trader are you? Do you buy into a trade and then watch impatiently at every tick in the stock price? Or are you more of a set it and forget it kind of trader who monitors the price every few days or weeks? Maybe your style is somewhere in between? Why is this critical and what does it have to do with time frames? read on.

The Day Trader Day Traders speedily buy and sell stocks multiple times a day to attempt to seal in quick profits. The Day Trader examines chart patterns and indicators which may span only a few hours or even a few minutes. Day trading is a speculative job where great amounts are realized or lost in mere seconds. Day Traders pay precise attention to tick-by-tick price information as it comes out on their screen in real time.

Under FINRA and NYSE rules, a trader once flagged and classified as a pattern day trader, must keep up a $25,000 account balance must obtain a margin account. For more info on day trading refer to the FINRA Notice to Members and the NYSE Information Memo.

The Active Trader - Momentum Trader Although there is no standard definition as with the Day Trader, the Active Trader looks for trends that cross from a few months to as little as a few days. A typical trade for an Active Trader trader can be very brief, possibly a day or may last for some months as long as the on-going trend is intact.

Active Trader Strategy - The Swing Trader Although the strategy used by the swing trader is very similar to that of the Active Trader, the central deviation is that the swing trader looks to maximize profits by capitalizing of the natural downturns in an overall upward trending stock. The Swing Trader cycles in and out of the trade repeatedly until the general trend weakens before making a last exit. Swing traders must observe the price activity more often than the active momentum trader since the swing trade requires frequent attention. - 23210

About the Author:

To see the original Beginning Technical Analysis article complete with example charts, visit www.StockChartGrabber.com

ETF Trading System For Beginners - System Rules

By Patrick Deaton

When you start trading you are going to find that there are many methods, strategies, and systems that look appealing. Some will seem very similar because they are hybrids of a long used ETF trading system. There are different rules of thought about systems among traders. Some people think that having a system and strategy are key to success. Other individuals don't think a system or strategy are necessary at all in ETF trading.

In'83, Richard Dennis and Michael Eckhardt decided to run an experiment to answer that simple question. Could people who had no experience at all with trading "learn" to trade successfully following a simple system. The experiment was called the Turtle System.

The Turtle ETF trading system also showed that even though a system is simple. For instance, all systems have a Step 1, Step 2 approach, most people deviate from the system even when they are winning.

Trend following and vector rotation are also a big part of most ETF trading systems. When an effective system is used consistently it normally will show the expected gains. However, if a person is not inclined to follow the rules of the system the results will be variable and usually result in losses.

All systems have some flaws. For some, the flaws are minimal and traders adjust the system to address the problems. The'83 Turtle ETF trading system was no different. There are many hybrids of the Turtle system available that have been tweaked. Some do not resemble the original system even though the users of the system say average annual returns of up to 80%.

When selecting a system you will want to fully understand the structure and rules that make the system effective. To see consistent gains from a system, it must be followed and paired with the strategy that will maximize its effectiveness. It must also be used in the right sectors. The effectiveness of a system in one ETF may be seriously different when used in another sector.

Most traders are using different systems simultaneously. One ETF trading system may work great with a vector, while the same system will be ineffective for another vector. Studying the effectiveness of a system for the vector you are trading in will allow you to make knowledgeable decisions about which systems and strategies to employ with your ETF trading.

Knowing the history and consistency of a system is also important. There are many systems introduced that do not have a history of consistent effectiveness. The tendency for some is to start using a system without knowing it's average earnings ratio. By doing some research on a system before you start using it you will be able to set realistic goals on your returns. You will also be able to pair the most effective strategy with that system to maximize your results.

Discussing different strategies and their effectiveness with other traders and professionals will also be beneficial. By doing the research and homework before investing in the trades using an ETF trading system, you will be able to find the best system for you. When a system sounds good, but the rules of the system are not what your personality would follow, it is best to find a system that is more compatible with your personality. - 23210

About the Author:

Learn how it's very possible to make 6% per month in your investment accounts using etf trading! "Big A" is a recognized expert in the world of etf trading system and reveals etf secrets that have been kept under wraps by hedge traders for years. Give him your email and get a free report and webinar today!

Gaining An Appreciation For The ETF Trading System

By Patrick Deaton

There are a few requirements that go into making up the elements of the good ETF trading system. For those who don't know or are unfamiliar, ETF stands for "exchange traded fund, " and it can be an exciting way to track sectors, invest in them and -- if you're smart and have a bit of patience -- make a quality income, though (as with any trading in any market) there's always risk involved.

ETFs are similar to mutual funds in the way that they are constituted. Additionally, it can help to think of ETF's somewhat as corporate stocks are in the way they are bought and sold. Investing through an ETF is a great way to keep a handle on investment costs because those costs are generally very reasonable in an ETF. As well, tracking of taxes is relatively easy.

Usually, most exchange traded funds are restricted to those investors that the fund calls "authorized participants." That means that it's normally only the large institutional investors who are allowed to participate directly in buying and selling of assets through the fund and its fund manager. The small investor, however, can get in on the action through an ETF trading system.

These trading systems -- and there are numerous versions of them on the Internet -- have been set up as a way to allow small investors with a small amount of what the trading systems call "starting capital" (this is usually around several thousand dollars) to get involved in the daily trading activities (called a "trading day") of the ETF and the trading system.

Most exchange traded funds track one of the major indexes that allow investors to get a gauge on the market or markets that these investors are interested in participating in. For example, many ETF's track the Standard & Poor's 500, which is one of the major indexes that investors watch on a daily -- or even minute by minute -- basis.

There are a number of rules that exchange traded fund trading systems use to regulate the activities of those investing for the day in the system. Usually, most trading systems share some similarity with each other, especially in the way they regulate the activities of the investors participating in the trading system that day and in how they track the markets. A common method is through trend following.

By following trends, investors in the trading systems can time their market movements in such a way that they can get into and out of funds very quickly. Money is usually made on the margin or on the micro movements taking place within those trends and markets. As a way of regulating investors in the trading system, ETF trading systems usually require all costs be settled or profits be taken by end of day.

For a small investor who has a limited amount of starting capital and who wants to get in on the possibility of making real and defined income by trading in exchange traded funds, and ETF trading system is probably the single best way of doing so. Costs are attractively low, as are the efficiencies and tracking of taxes that may result. Additionally, there's plenty of training available for those thinking of participating. - 23210

About the Author:

Learn how it's very possible to make 6% per month in your investment accounts using etf trading! "Big A" is a recognized expert in the world of etf trading system and reveals trading and investment secrets that have been kept under wraps by hedge traders for years. Get his free report and webinar today!

An Introduction To Variable Annuities

By Julio Battista

This article will give you a quick rundown of the most important things to think about when you're looking for a variable annuity as well as how to decide which annuity will best meet your needs.

Like any other annuity, a variable annuity is a contract between an investor and an insurer. The investor makes a lump sum payment or ongoing payments to the insurance company.

The investor then receives payments consisting of a portion of the principal as well as the interest earned by said principal on an ongoing basis. These payments may continue for life or for a set period of time as stipulated by the contract.

With a variable annuity, you decide how to invest the money that you have placed with the insurance company. There will be a list of pre selected funds ranging from highly aggressive stocks to conservative bonds and you choose how you wish to invest.

With a variable annuity, investors have the ability to invest their money in vehicles which are outside of the annuity proper, but also enjoy the tax deferral benefits of an annuity.

Variable annuities generally also include an option to convert the annuity to a fixed annuity. During the life of the annuity, the investor may choose to keep their payments invested in stocks and bonds, with the value of their investment fluctuating with the markets. Alternately, the investor can opt for a fixed interest rate if they would prefer to avoid the risks of the stock market.

A portion of your annuity payments can also be allocated to any account of your choice which provides a fixed interest rate. Your investment can be thus shifted without having to pay taxes on these gains until such a time as you actually receive a payment. Once you begin receiving payments, you may choose to receive them as regular ongoing payments or as a lump sum.

Generally speaking, investors do very well with a variable annuity invested in the major US markets. Though there is always some risk involved with investing, most economists and financial experts regard stocks as a solid investment which provides flexibility and tax deferrals.

Before deciding on a variable annuity, investors do need to keep in mind that there are costs associated with these annuities which can be upwards of 3%. You'll want to make sure that you understand both the costs and benefits before choosing variable annuities as a way to invest. - 23210

About the Author:

Need to learn more about annuity options and other types of annuities visit http://www.variableannuityquote.com

Singapore Properties For Sale In Singapore

By Billy Chen

Do you have a property in Singapore that you want to sell? Are you thinking of the steps which you should undertake to sell your Singapore property? If the answer to these questions is 'yes' and the best way to do this is find a real estate agency or agent who would help you to sell your Singapore property.

Here you'll find many real estate agencies in Singapore to find and you can select the agent that provides the best service in the industry. Get yours useful information on real estate in Singapore.

The real estate agency or agents are kind of expertise people who deal with buying and selling of properties. Taking the help of such real estate agency or agents, sell your property irrespective of the kind of property it is that you are selling.

The real estate agent deals in property such as apartments, condos, bungalow, office building, warehouses, storeroom, etc. If you have decided to sell your property then make sure that you employ the assistance of one real estate agent only. There is no need for you to take the help of two or more real estate agent. All you need to do is do some research before you begin to interview people.

So do take into considerations those factors.While you are deciding on the real estate agent for selling your property, you may want to consider certain factors before you make your decision. You can make a list of a few real estate agencies and after you find out more information about each of the agency, you can select one real estate agency to handle your sale of Singapore property.

You should opt for that real estate agent that advertise or promote its services in a number of publications. This way the agency would get more exposure and when it gets more exposure then the chances of your property being sold would also increase. Possibly the best way to find a good and reliable real estate agent to help you sell off your property is to ask your friends or people you know for referrals.

How fast you can sell your property depends on how much effort you put in to selling your property. Do your homework well and you can be sure that you will be able to sell your property very quickly. - 23210

About the Author:

Want to find out more about Hotvictory , then visit our site on how to choose the best Singapore Properties for your needs.