TECHNICAL ANALYSIS is a security analysis methodology for forecasting the direction of prices through the study of past market data, primarily price and volume
Simple moving average or DMA :frequently used in technical analysis showing the average value of a security’s price over a set period. Moving averages are generally used to measure momentum and define areas of possible support and resistance.
Stocks trading above its 30,50,150 or 200 DMA are considered as those stocks that are above their resistance and are likely to go up, on the other hand Stocks trading below their 30,50,150 or 200 DMA considered as those stocks that are below their support levels and are likely to come down.
most important is 200 dma stocks trading below 200 dma are considered in long time bear market and holding above 200 dma is considered in bull market
NOTE: This is not only a single factor that should be taken into account while purchasing or selling a stock, it largely depends on the market conditions
BREAK OUT A breakout is when prices pass through and stay through an area of support or resistance. On the technical analysis chart a break out occurs when price of a stock or commodity exits an area pattern.
CHART PATTERN :
A Price pattern is a pattern that is formed within a chart when prices are graphed. In stock and commodity markets trading, chart pattern studies play a large role during technical analysis. When data is plotted there is usually a pattern which naturally occurs and repeats over a period. Chart patterns are used as either reversal or continuation signals.
Some people[who?] claim that by recognizing chart patterns they are able to predict future stock prices and profit by this prediction; other people respond by quoting "past performance is no guarantee of future results" and argue that chart patterns are merely illusions created by people's subconscious. Certain theories of economics hold that if there were a way to predict future stock prices and profit by it then when enough people used these techniques they would become ineffective and cease to be profitable. On the other hand, predicting what others will predict the market will do, would be valuable information.
Resistance – a price level that may prompt a net increase of selling activity
Support – a price level that may prompt a net increase of buying activity
What is DMA (Simple moving average) in stock market ?
Stocks trading above its 30,50,150 or 200 DMA are considered as those stocks that are above their resistance and are likely to go up, on the other hand Stocks trading below their 30,50,150 or 200 DMA considered as those stocks that are below their support levels and are likely to come down.
most important is 200 dma stocks trading below 200 dma are considered in long time bear market and holding above 200 dma is considered in bull market
NOTE: This is not only a single factor that should be taken into account while purchasing or selling a stock, it largely depends on the market conditions
BREAK OUT A breakout is when prices pass through and stay through an area of support or resistance. On the technical analysis chart a break out occurs when price of a stock or commodity exits an area pattern.
CHART PATTERN :
A Price pattern is a pattern that is formed within a chart when prices are graphed. In stock and commodity markets trading, chart pattern studies play a large role during technical analysis. When data is plotted there is usually a pattern which naturally occurs and repeats over a period. Chart patterns are used as either reversal or continuation signals.
Some people[who?] claim that by recognizing chart patterns they are able to predict future stock prices and profit by this prediction; other people respond by quoting "past performance is no guarantee of future results" and argue that chart patterns are merely illusions created by people's subconscious. Certain theories of economics hold that if there were a way to predict future stock prices and profit by it then when enough people used these techniques they would become ineffective and cease to be profitable. On the other hand, predicting what others will predict the market will do, would be valuable information.
Resistance – a price level that may prompt a net increase of selling activity
Support – a price level that may prompt a net increase of buying activity
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