Technical Analysis is summed up with various theories and strategies of stock market, people do follow technical analysis to analyze stocks but is analyzing stocks worth to make profits?
Many people consider stock market as a game of luck or a gamble but it’s a business of various businesses all it depends on is person’s opinion of considering it. If you analyze and trade on the grounds of technical analysis you can make handsome bucks from stock market.
Technical Analysis is the analysis of price movements so we can say that technical analysis is totally dependent on price of various securities, using technical strategies is very interesting but you must keep some basic points in your mind while analyzing any security.
Steps to Follow for Analyzing a Stock
1. Trend: In stock market you have to follow one rule which is “Trend is your Friend” Always trade in the trend, never trade opposite to the trend.
But, how to know the trend?
To know the trend become it’s friend you have to follow technical analysis, Technical Analyses is the reading of technical charts made from the past price movements, and after watching them you can easily predict the future trend.
Read this article to know more about trends: Market Have Three Trends – Dow Theory
2. Volume: Volume is the number of shares or securities traded in a particular period of time which reflects in the prices too and helps to understand the trend more better.
3. Behavior: If you are a day trader then notice the price behavior for that particular day to analyze your trend, and if you are an Investor then notice the price behavior of security behaved in the past few months and know your trend.
4. Decision making: Decision making is the more important part rather than the analyzing of stock as people analyze their stock’s trend but fail to execute them at correct timings as they lack in decision making, so you have to work on your decision making power if you wan’t to earn handsome bucks from stock market.
5. Exiting the stock: After taking your decision and executing your trades the second step is that you have to be aware if your loss capacity and profit satisfaction, so you have to exit your stock as any of it reaches weather it gives you loss or profit.
If, you followed these steps strictly then you may get succeed in earning some bucks and you will be ready to increase your profit satisfaction limit to the next level.
We, will share some more steps related to the next level of trading so don’t forget to subscribe to our newsletter service to get updated and feel free to comment below.