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| Date: Tuesday 13th 2008f May 2008 02:46:49 PM |
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Getting Started in Technical Analysis |
| By: Novice Investing Staff |
| Uptrend and Downtrend Line |
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There are three directions of stocks movement. It can be in an uptrend, downtrend or moving sideways. It is important to know which direction a particular stock is moving because normally we would find support in an uptrend and resistance in a downtrend. The graph below shows Texas Instrument, Inc. (TXN) 10 month chart. It had been in a downtrend until Sept of 2004 when it broke the downtrend line with high volume. I can safely say that at the very least the stock is moving sideways now. The selling is done for the time being.
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The next two charts show the stock in an uptrend. First chart is QualComm Inc. (QCOM). It started the uptrend at the beginning of the year and it still is in an uptrend. Volume analysis shows that in recent months, QCOM declines in higher volume. This brings a warning sign if we were to buy QCOM stock at this point. The next chart is the graph of Circuit City Group (CC). No tricks here. It had been in an uptrend since the beginning of the year. |
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Well, that's pretty much it for getting you started in Technical Analysis. If you have more questions about the subject at all, let's hear your thoughts at our Discussion Boards |
