Principles of successful stock chart analysis

You will prepare every day to stock trading by stock chart analysis. You will look at a lot of stock charts or stock market index charts to identify what happened and what could happen during next days.

Predict the future? Yes ! You will use candlestick charts to find most probable scenario which can realize in near future. And to find best stock trading opportunity.

Do not worry. I will show you simple basic principles I prefer to use during chart analysis. My chart reading and trading is based on these basic stones:

• support and resistance levels 
• trend
• stock volume 
• chart patterns
• relative strength
• stock chart time frame analysis
• bullish or bearish candlesticks
• Fibonacci retracement

Every time when you will be looking at chart you have to ask if the price is near some of important level of support or resistance.

These levels you could identify as horizontal price levels but it is not only possible way how to identify support and resistance.

These stock market analysis tools are also very helpful

• Moving averages
• Trendlines
• Retracement levels

Next important knowledge for stock trader is to know everything about stock trend. Is your stock trending ? There is very important to know how to find answer to this question.

You can find :

• Uptrend
• Downtrend
• Non-trend range

Another important indicator you have to take into consideration when you are trading is volume . Stock volume analysis is very powerful technique in hands of clever trader.

I use this simple technique for volume monitoring during trading day and to decide if current level of volume is important or not.

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