http://tutorials.topstockresearch.com There are two major yet very contrasting approaches to do the same. Technical Analysis Technical analysis is a study of . real life examples and well supporting community. Since we are primarily into technical Analysis. so that our visitors get exposure to not only theoretical examples but to real world behavior of stocks when such patterns/indicators are observed. we have tried to provide introduction to both at Stock Analysis Introduction. They are Technical Analysis/ Fundamental Analysis. On daily basis we generate lots of pre-screened reports based on standard indicators/patterns that help visitors to gain good insight of stock patterns based on its previous price movement to enable them to take some important trading/investment decision.Learn Technical Analysis with Examples & Integrated Stock Screener About this Site We aim to provide comprehensive Technical Analysis of stocks starting from the most basic concept to advance concepts of technical analysis along with their trading strategy. What make us different from others is that we do not limit it to theory but we have integrated this section with stock screener of multiple geographical location. majority of the tutorials and screeners are based on it. so that they are better geared for trading decision in futures. Stock Analysis Stock analysis is a technique to measure the pulse of the stock and determine the right price to enter and exit stock with handsome return. But to bring it to perspective. it has become handy for lot of part timer traders/investors also. Some uses technique like simple over bought/oversold oscillator. in certain direction. low and close. lots of research is being done and lots of different sub streams have evolved. high. Some draw simple closing price line chart to find support & resistance. while some use momentum indicator to measure trend and its strength. analyst can bet on the buying or selling of the stock. Technical analysts study these price movements and identify formation of patterns that are formed repeatedly and the behavior of price after formation of patterns. With this much of choice. There are three basic principle of technical analysis. Price Discounts Everything. novice users often get overwhelmed and are not sure where to start and often run away or make incorrect trading decision when try to use too . As we speak. Technical Analysis is a very mature form of stock research and with that being the case.historical price and volume of the stock to predict its future behavior. while some uses more advance technique to understand market cycle using Elliot waves. Price Moves in Trends & History repeats itself. is very high then. while some prefer to draw relatively complex candlestick chart with multiple points like open. Charts are most essential and powerful tool in Technical analysis and owing to advancement in computer science and easy online access to them via site like ours. If probability of price movement after this pattern. So please take caution in taking important trading decision. they could be simple ones like Moving Average. operation. profit. or simple oscillator like RSI.many of them with less experience. expected demand. and read and observe their behavior using our stock screener and do some paper trading before start making consistent analysis.Fundamental Analysis Fundamental Analysis is a study based on company financial past results including sales. They are: _BLACK 1. Stock Analysis Introduction Technical Analysis Tutorial Stock analysis is a technique to measure the pulse of the stock and determine the right price to enter and exit stock with handsome return. As this is vast topic. There are two major yet very contrasting approach to do the same. general economic forecast. We think it is necessary to make a mention that it takes lot of reading and experience to trade like a professional using these concepts. or a chart pattern like double top. . profit margin. we split it into multiple sections and they can be navigated from the menu but we suggest you to learn more about basic of technical analysis first. One of the key to success is to select a few of them. management and many other parameters. Both these approach may not always give buy/sell signal at the same time and may even give strong and opposite signal on same stock.org/wiki/Fundamental_analysis 2. study of charts to determine patterns and use them to trade when such patterns has very high probability of a stock movement in a certain direction. Based on these studies." http://en. analyst tries to find right value (intrinsic value) of the stock. _BLACK Both these analysis uses very different ways to analyze stocks and have been quite effective in producing good results. They rather study equity's price and volume movement to predict the future direction of the stock price. Definition from Wikipedia "Fundamental analysis of a business involves analyzing its financial statements and health. competition. and its competitors and markets.sales forecast. One study may indicate strong buy where as other may give strong sell. A buy or investment decision is taken and when stock is trading below right value and a sell decision is taken when the stock is much above its fair value. Since the focus of the site is on technical analysis we will limit our scope on fundamental analysis to this level only. debts. Technical analysis in a very simple definition is. Beginners .wikipedia. its management and competitive advantages.Technical Analysis Technical analysis on the other hand do not believe in the finding intrinsic value of the stock. Learn Technical Analysis Basics with Examples Technical Analysis Definition Technical analysis is a study of historical price and volume of the stock to predict its future behavior. in certain direction. Basic principles of Technical analysis Technical Analysis is based on these three principles: 1. Technical analyst study these price movement and identify formation of patterns that are formed repeatedly and the behavior of price after formation of patterns. when undervalued stock is in downtrend then it makes sense to wait for a lower level than buying the stock at that price. If probability of price movement after these pattern.may get confused and are strongly advise to study both but follow one. upward trend in the stock is very strong in such case it makes sense to hold the stock till strength of the trend weakens and thereby maximizing the profit. analyst can bet on the buying or selling of the stock. Price Discounts Everything: Technical analyst believe . is very high then. the stock is over priced and it suggests exit of the stock. But. Best of both world: Fundamental analyst look to buy a stock when it is at attractive price (below fair value) and when technical indicators also support the call. as mixing them could produce undesired results. Similarly. For Example: Based on fundamentals. 1. . is fair value of the stock and has correctly factored in all the information that could affect the price of the stock at any given point of time. Or Investors in certain scenario. Some indicators like Williams %R gauge over bought and oversold conditions. Price Moves in Trends: Technical analyst believes that share price moves in trends whether upward or downward or sideways. even though they are irrational. Demand & supply. If indicators suggest sustained demand/supply. On Analyzing stock movement in greater details. Some indicators like MACD & Moving Average helps to find beginning of trend or end or reversal. technical analysis helps to find two things. while some tries to find where and how money is flowing.in efficient-market hypothesis (EMH). This means the current value of the stock. If technical indicators suggest that there could be surge in demand then price may shoot up and vice versa. 3. And they will continue to do so in future. They go by this assumption to trade in stocks. History Repeats Itself: Technical analyst believe that market movement in a certain situation would be similar to its movement in the past. then stock moves in trend. will behave in similar way as they behaved in past. These typical movements are studied by analyst and are used to take advantage in trading stocks for a given situation. 2. while some like ADX tells about trend strength. analyst tend to rely on tools and website . this is a result of traders tendency to react in certain way after some news. Learn Technical Analysis Basics with Examples: Part II Tools used in Technical Analysis Technical analyst depending on their generation and experience various techniques. resistance line are observed again and again. Similar market cycle. Minimum Period for Technical analysis In contrast to fundamental analysis. are Charts. With sophistication of tools and advancement in computer science and easy access to world of knowledge using mobile internet. Among popular once. These behaviors results in typical chart pattern. Possible behavior of traders/investors in certain situation. accumulation/distribution and chart patterns like triple top. technical analysis can be applied at any period of time from few minutes to many years. Owing to shorter time interval. they have become extremely popular with day traders and swing traders who trade may trade several times a day or may trade in duration of few trading days to few weeks to few month. Chartist carefully observes price and volume to see strength or weakness of the trends and try to take advantage of emotional decision taken by the parties. Price movement of shares tend to follow certain trends. excel and even some continue with pen & paper to do calculate intraday support and resistance using Pivot Point.2. Charts are most essential tool for the analysts of this generation and with the advancement of technical analysis. It also provides option to the viewers to create their own charts using interactive chart. Result is plenty of choice of indicator and plenty of . Some of them have made their findings to public while some have kept it as trade secret. charts have also improved. Some of the commonly used charts are 1. chart to compare with other stocks etc. Typical Technical Indicators Quicker results. TopStockResearch. Bar Charts. 3.com provides range of charts from very simple chart one month EOD line chart to complex technical charts with moving average and other indicators. more agile way of analysis and lesser requirement of investment/infrastructure have encouraged lots of research on this stream of stock analysis.like ours to do charting or pattern finding. Candlestick Charts. 2. Line Chart. These are the point which forms a very importance levels which stocks doesnt tend to penetrate. it indicates trading pattern in that interval. 3. they tend to make huge movement and in that direction. Since it contains more information. or a dynamic band like Bollinger Bands. to reversal pattern like Bullish Engulfing or trend . MACD. Stocks when breaks out from support or resistance. They are more complex type of chart plotted with open. Among the more common ones are 1. Trends are friends. Trend Strength indicator like ADX. Breakout. In other cases only support or resistance may be present. One of the most common and most successful form of trading is trading with trend. Candlestick Charts. low and Close. 5. Support and Resistance. Both support and resistance can be together as in case of chart pattern channel. high. These can be as simple as single day pattern like Hammer. Chart Pattern. Some of the very common ways to identify trend are Moving Average . Key to success if to identify trend and start trading till a trend reversal is observed. 2. 4. websites. for the traders to pick and choose their favorite ones. Trend Trading. They may be horizontal trend line or rising trend line or dynamic line provided by Moving averages.tools. These are formation of certain patterns indicating reversal of trend like Double Bottom (W) or continuation pattern like flag. Always use stop loss when relying only on technical analysis. they do not guarantee similar behavior in future. Some Indicators rely on volume to find the phase in market cycle like accumulation/distribution. MFI utilizes volume to figure out money flow. Money Flow. Commodity etc. Applicability of Technical Analysis Since it studies price volume history of the stocks. Secondly. it can well be applied to other financial instruments like Forex. Observing charts of a stock or any financial instruments shows that charts always move in a zig zag manner whether its an uptrend or downtrend or a sideways market market. CMF. and how smart money is flowing. since they are purely based on past price movement. Tutorials On Market Cycle What is Market Cycle? The price of a stock never moves in one direction and in one fashion. Cautions Technical analysis is more of an art than science. and prior sequence of events. In real life. the pattern formation may not be as clear as theoretical examples. Indicators like ADI. it is very important to keep a stop loss when playing in stocks. On carefully observing those zig-zag patterns reveals that they are not .continuation pattern like Three White Soldiers. 6. Therefore. It requires lot of experience to trade using technical analysis. rather they are following a cycle called a market cycle. Components of Market Cycle: All market follow the same cycle that is they go up. This is also known as the oversold phase.Accumulation: Accumulation phase is formed at the bottom or near the bottom of a chart. Here the long term investor (smart and experienced) enter in the market and start accumulating the .just moving in an haphazard way. They are: 1. There are basically four phases of Market cycle. It is very important for a trader to know the market cycle as it will help in guiding the possible entry and exit points of a trade.This is called as market cycle and after one cycle another cycle will follow and this will go on. then go down and then form a bottom. follow peak. . Distribution is witnessed by other chart patterns like double top.They feel that the worst bearish phase comes to an halt and sooner or later the bull will take over the market.Mark Down: This is the last phase of the cycle and is followed by fall in price till another accumulation phase is reached. This phase is the saturation phase where bulls looses its faith and bears takes over.Distribution: This phase forms the top part of the cycle. Distribution gives traders signal to sell or short. 3. It depends on a particular investor or trader what horizon he is looking at and comfortable with for trading. 2. Here buyers gives over and seller comes into play making the price falls. head and shoulder etc. We also recommend to read How volume plays an important role in finding different phase of market cycle along with this text. In accumulation phase the price do not move much. Duration: Market Cycle may be as short as few minutes to weeks and may last longer like few years. rather it is neutral (flattened). Accumulation gives traders signal to buy or long. Mark Down gives traders signal to sell or short.Mark Up: This phase starts when the neutral accumulation phase will gives a breakout witnessed by an increase in volume. This is also known as oversold level. Mark up phase also gives traders signal to buy. Here other traders and investors jumps in.stock at the discounted price. following an uptrend. 4. In this phase traders can watch formation of lower highs and lower lows. This phase is also witnessed by the formation of higher highs and higher lows. . Tutorials on support and resistance with examples and Strategies. Why are these support and resistance formed? Support and resistance are formed at points around high supply or demand zone. Support Basics Resistance Basics Support and resistance are one of the important pillars of technical analysis and stock analysts invariably use them as one of their key technical tools. If at support at 100 then in and around that price there are lots of buyers ready to buy causing the stock not to fall from that price perceiving it to be cheap and same goes for resistance where lot of traders would like to offload their positions considering that price to be too high for the stock and good time to book profit. . Support is a point below which stock price is unlikely to fall below unless a significant development around the stock takes place and resistance is a price beyond which stock price is unlikely to rise in the selected time frame. Or they may even by a dynamic price with Market movement. support price may continue to move up and vice verse.These points can be static price like a psychological number like 100 or 50. So it is important to identify them based on period where traders are performing analysis Minor Support & Resistance cause trends to slow or pause while major Support & Resistance cause trend reversal Parameters Determining strength of Support and . Support and resistance exist for small interval period like intraday to a multiyear time frame. These points validity depends on trend they are in or the time frame. If the overall market is moving up. or even may be previous highs/lows. The longer the period the support/resistance line holds before break.Volume: Higher volumes add strength to the Support or Resistance.Height: The broader the distance between the Support and Resistance the more powerful it is. Support once broken acts as a resistance in future while resistance broken act as a new support in future. What happens when Support or Resistance Breaks? The market sentiments is not the same at all the times. 2. a price is hitting showing the positive sentiments. as it depends on a lot of factors. the stronger the reversal is. . They are: 1. Higher volumes indicates more traders have the same sentiment at a particular time frame. Longer duration shows more points. 3.Resistance? A number of factors a trader may want to look around to see the strength and to confirm it. results in breakout of Supports and Resistance.Length: The longer the duration of Support or Resistance the more reliable and stronger it is. They are: 1. More smoothened lines formed by moving average. Therefore on the basis of that Supports and Resistance is of two types. 4. Fixed price like pivot or Fibonacci retracement levels. . For example in an uptrend it can be a sloping upwards. Horizontal Supports and Resistance (Equal Highs and equal lows) 2.or it can be a horizontal in case of sideways etc.Example of Support and Resistance With Example Shapes of Support and Resistance? If you look at the chart patterns traders may come across different levels of support and resistance. Slanting or diagonal Supports and Resistance (Higher highs and higher lows or Lower highs and lower lows) 3. Next .