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Learn technical analysis of stock quote charts for bearish situation

Tips for easy reading of stock charts
and better stock market charting & analysis

Technical stock quote charts are important tool for technical trader. But I think that also active investors should master reading of stock charts. It gives them advantage for decision about entering positions and exiting of position.

These technical stock charts can provide information if stock is now in bullish move or in bearish move.

Why it is important?

When you know that stock is in bearish situation or presents relative weakness then you can decide to sell your long position and take profits without risk of possible drop in stock price.

Second possible outcome is that you can think to enter short sell trade in such stock with expectation to generate profit from possible drop in the price.

What tools of stock chart technical analysis
to use for analysis of stock market ticker ?

Reading of stock charts is not rocket science. I developed simple design for my trading. There are only two moving averages on my daily charts. The decision about bearishness of the stock is based on them.

Main condition for bearish technical analysis charts is that price is under 50day moving average (simple Ma or EMA).

I prefer to use exponential moving average in my stock analysis software but the decision is on you what you will prefer to use.

If the price is also under 200 day simple moving average then it is much stronger bearish signal. I would not buy such stock for bullish trade.

Here are examples of bearish stock price charts

Here you can see situation on stock market index chart at the same time.

As you can see it was wise to avoid GOOG and BAC stocks and not to buy them.

Active traders was able to find possible short sell trade setup in these stocks these days.

Return from stock quote charts to stock chart analysis

Return from stock quote charts to simple-stock-trading.com

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