And thats true... you might read thousands of words, hundreds of webpages, tens of research reports and you might talk to more than one financial advisors. All of this usually goes in vain. You are still confused !!!
Why?
Simple, all of these reports and experts have their own views and conclusions. Most of the time, such views are almost opposite to each other. You would be in a dilemma - whom to trust and not to trust? And I bet you, you are not all alone. Everybody who get into doing all the research and consulting is bound be in the similar situation.
Thats why this picture is here.
This is NIFTY (one of the Indian stock exchange representing 50 scrips) chart for last three years. Chart shows the weekly movement of nifty over last 156 weeks. Its a candlestick chart (I'll tell you later what is that) in which each candle shows the open, high, low and close for a particular week. Below the candlestick chart, there is another bar chart showing weekly volumes.
What does this tell you?
Observe the red lines, below and above the candles. If you can see them, you are the expert. Because, these lines represents the market movement. Each of the small lines prompt you to make transaction i.e. either buy or sell. Its as simple as that.
If you observe it closely, you would know, when the red line comes below the candle you should buy and vice-versa. For example, in the week starting Apr-09 the red line is below the candle, prompted you to buy the index and you can calculate how much profit you would make till the red line moves above the candles.
Simple, huh?
Yeah, I think. But you should also tell me what do you think about it. Is it as simple as it seems?
BTW, if you have understood the same, I bet, you have become the guru of technical analysis.
Cheers
No comments:
Post a Comment