| People get involved with stock market investing at | | | | assumptions about the stock market and how it is |
| different times in their life, but no matter how much | | | | most likely to move. Becoming comfortable with |
| you've decided to put into your portfolio, or whether | | | | these assumptions will help you to understand why |
| you've decided to manage your trading all on your | | | | technical analysts make the trading decisions that |
| own, or leave it in the hands of a professional broker, | | | | they do. First, technical analysis assumes that the |
| it's safe to say that your motivation was probably to | | | | market is able to adjust for outside influences on its |
| make your money grow faster than it would be able | | | | own, meaning that company stability, public demand |
| to in a high yield savings account or certificate of | | | | and financial history can all be represented in the |
| deposit. Profit is the driving motivation for all stock | | | | price. Second, technical analysis assumes that the |
| market activity, and if you're going to learn how to | | | | market is inclined to move in trends and gaps or |
| use changes in the market to achieve this goal, it's | | | | reversals will only happen when an outside force |
| important that you learn as much as possible about | | | | exerts its influence. Lastly, technical analysts assume |
| technical chart analysis. | | | | that history is likely to repeat itself, which means that |
| No matter what industries you're interested in, or | | | | past patterns are likely to resolve themselves in the |
| whether you're focusing on long term investments or | | | | same manner that they have in the past. |
| day trading, it's important that you have a working | | | | Although technical chart analysis is the most popular |
| knowledge of technical chart analysis and how it can | | | | method for market evaluation among short term |
| be used to help you anticipate and exploit price | | | | traders, it isn't the only way that you can inform |
| movements in the stock market. To start, you | | | | your decisions about which stocks to buy and when |
| should know that technical analysis is the practice of | | | | to trade them. Many investors also used fundamental |
| predicting future price movements by analyzing past | | | | analysis to decide which securities have the most |
| price fluctuations, and identifying the trends and | | | | potential for long term success, but this requires a |
| patterns that are most likely to repeat themselves. | | | | great deal of qualitative research and is most popular |
| Technical chart analysis is based on three fairly simple | | | | among commodities or income investors. |