From technical analysis people can look at the stock chart and predict that the stock will breakaway and go up. I want to learn more about technical analysis, so I can be better with stocks’ trading.
6 Responses to “How can I predict that the stocks will breakaway?”
on 31 May 2007 at 12:17 pm 1.mahantesh a said …
less volume will be down trand
and more volume will be up trand
more volume down trand will occur when there is some
inner problem in a company
on 31 May 2007 at 8:46 pm 2.johnmba said …
Follow insider activitiy. Since organizations like insurance companies, other companies and big banks own most of the stocks, when they make a move, the stock jumps.
Insiders know way before you do…
on 02 Jun 2007 at 3:30 pm 3.cordefr said …
Well, one doesn’t *predict* breakouts. It is just that some situation are more favourable for breakouts than others.
Typical good pattern are triangles and flags. In both cases uptrending stocks temporarily go sideways, when for a while more people want to go out than come in. After a while those who wanted to sell have done so, which shows in the dropping volume.
In those cases you would put your buy stop just above the triangle.
You are not predicting the breakout, just waiting for it to happen.
If it doesn’t, you aren’t filled and that’s it.
on 05 Jun 2007 at 2:45 pm 4.Founder, MastersoEquity.com said …
Technical analysis is not a small topic that can be adequately discussed and explained in a small question and answer forum like this one. That is why there are tens of thousands of books written on this topic.
First thing to be very clear of is your use of the word “Predict”. There is no such thing as “Predict” in the stock markets and the purpose of technical analysis is not to “Predict”.
Technical analysis basically makes use of the 2 known elements of every stock transaction in order to make all kinds of calculations on them. The 2 elements are :
1. Price
2. Volume
From these 2 simple facts, thousands of ways to represent their behaviour are calculated and presented in what we call indicators and charts in a study called technical analysis.
Technical analysis gives an experienced user the ability to tell if something will happen to a stock in a certain way with a certain degree of confidence, which in essence, do not amount to a prediction because it do not always behave that way.
The main fallacy of technical analysis is that it is a study based on historical data and assumes that the data from the past is representative of what might happen in the future. This assumption will completely fail when big events suddenly happen like the 911.
That being said, to me, technical analysis is more accurate than any other form of analysis I know of in giving me high confidence trades and have directly contributed to my 28 years old retirement as a stock market millionaire.
To see the technical analysis method that I use, please visit
.
on 07 Jun 2007 at 12:09 am 5.Randy H said …
A visit to the Chart School over at StockCharts.com may help to get you started, but it’s a HUGE topic:
If you want to play around with indicators and data online, StockFetcher can be a useful tool:
on 07 Jun 2007 at 6:15 am 6.cosi said …
grab a book on japanese candle sticks. a technical charting tool with a good number of versatile indicators. take a look at charts of many products (their tradingactivity) over the past year, month, week even day. couple what indicators you can identify in these charts with market data such as p&l diclosures, layoffs, rate cuts, jobless expectations ect ect ect.-happy trading…its just money.
on 31 May 2007 at 12:17 pm 1.mahantesh a said …
less volume will be down trand
and more volume will be up trand
more volume down trand will occur when there is some
inner problem in a company
on 31 May 2007 at 8:46 pm 2.johnmba said …
Follow insider activitiy. Since organizations like insurance companies, other companies and big banks own most of the stocks, when they make a move, the stock jumps.
Insiders know way before you do…
on 02 Jun 2007 at 3:30 pm 3.cordefr said …
Well, one doesn’t *predict* breakouts. It is just that some situation are more favourable for breakouts than others.
Typical good pattern are triangles and flags. In both cases uptrending stocks temporarily go sideways, when for a while more people want to go out than come in. After a while those who wanted to sell have done so, which shows in the dropping volume.
In those cases you would put your buy stop just above the triangle.
You are not predicting the breakout, just waiting for it to happen.
If it doesn’t, you aren’t filled and that’s it.
on 05 Jun 2007 at 2:45 pm 4.Founder, MastersoEquity.com said …
Technical analysis is not a small topic that can be adequately discussed and explained in a small question and answer forum like this one. That is why there are tens of thousands of books written on this topic.
First thing to be very clear of is your use of the word “Predict”. There is no such thing as “Predict” in the stock markets and the purpose of technical analysis is not to “Predict”.
Technical analysis basically makes use of the 2 known elements of every stock transaction in order to make all kinds of calculations on them. The 2 elements are :
1. Price
2. Volume
From these 2 simple facts, thousands of ways to represent their behaviour are calculated and presented in what we call indicators and charts in a study called technical analysis.
Technical analysis gives an experienced user the ability to tell if something will happen to a stock in a certain way with a certain degree of confidence, which in essence, do not amount to a prediction because it do not always behave that way.
The main fallacy of technical analysis is that it is a study based on historical data and assumes that the data from the past is representative of what might happen in the future. This assumption will completely fail when big events suddenly happen like the 911.
That being said, to me, technical analysis is more accurate than any other form of analysis I know of in giving me high confidence trades and have directly contributed to my 28 years old retirement as a stock market millionaire.
To see the technical analysis method that I use, please visit
.
on 07 Jun 2007 at 12:09 am 5.Randy H said …
A visit to the Chart School over at StockCharts.com may help to get you started, but it’s a HUGE topic:
If you want to play around with indicators and data online, StockFetcher can be a useful tool:
on 07 Jun 2007 at 6:15 am 6.cosi said …
grab a book on japanese candle sticks. a technical charting tool with a good number of versatile indicators. take a look at charts of many products (their tradingactivity) over the past year, month, week even day. couple what indicators you can identify in these charts with market data such as p&l diclosures, layoffs, rate cuts, jobless expectations ect ect ect.-happy trading…its just money.