Jul
23
2015

Make technical analysis work for you !!!

When we hear about technical and fundamental analysis it does sound great as a subject to study and to steal our interest. But when it comes to investing with stocks, we as a common investor look for so-called brokers or advisors for telling us what to buy and what not.

So here I would like to break the mis-conception that these analysis tools are not like middle school mathematics that we just study but never use practically (no offense though).

So I would take this opportunity to make it a point, how can we make technical analysis ACTUALLY work for us so that we don’t rely on those gurus anymore.

The basic rules for technical analysis goes as:

 

  1. Study a couple of technical analysis tools and practice them (mock trades) a couple of times.
  2. Decide for yourself which tools work best for you and/or which of those you easily understand and could analyze more efficiently.
  3. Sometimes people believe that particular tools work better for them whereas others feel same tools never work when they use them. So try them out in mock sessions yourself (don’t use others experience).
  4. Then select 2-3 such tools that you are most comfortable with and study them in detail. Don’t select too many else you will confuse yourself while taking decisions.
  5. Once you start using these tools in actual investment keep track of them (in a spreadsheet may be) to know which one has provided you with accurate results over time. This would let you prioritize among those.

 

To check some of the technical analysis tools that you could try using could be found here: technical analysis tools

However I personally prefer a combination of basic fundamental and technical analysis while making decisions.

Learning technical analysis is not a big deal. Keep reading good articles and follow some blogs that discuss these. Over time you will only gain experience.

Happy investing !!! :)

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