Technical stock charts
for profitable stock chart analysis
Short term and position traders use technical stock charts a lot. They are basic stones of their stock trading strategy. But I think that also active investors should be familiar with using stock chart analysis.I use also stock price charts a lot. They help me with my trading decisions that I do for my personal trading for a living. I have tested several setups of technical stock charts. I used several different indicators and also checked several different ways how to read stock chart. Finally I realized that most profitable approach to stock chart analysis is to use SIMPLE stock price charts. Since I did this discovery I started to promote simple usage of stock price charts.
What it means to use
simple technical stock charts ?
When I started to learn how to trade I was in process of stock trading strategy creation. I decided to use
stock trading strategy
based on
stock chart analysis.
But how to analyze stock charts ? I studied different books about stock market technical analysis. I tested different indicators. Then I started to set up my technical stock charts.I noticed one problem after some time. I was not able to make correct trading decisions. Why ? My stock price charts were too complicated. I have too much indicators on long term stock charts and short term stock charts. The whole picture was very messy. I was not able to read chart and make clear decision where to set up
entry point,
stop loss level
and
target level.
I was also very distracted when I tried to
manage trade
based on stock chart analysis of such stock price charts. Look at example of very messy stock price charts I used before.
So after some time I decided to simplify them. I decided to take away some top indicators and some bottom indicators. I finally deleted almost every indicator on my chart. And these days I use this version of stock price charts.
Set up correct colors
for your stock price charts
I have noticed that it is important also to set up proper colors for stock charts. When stock price charts are set in bad colors and also filled with a lot of indicators then result is very strange. I personally cannot use charts like this example I found on one financial blog.
Using technical analysis is up to you. You will decide what type of stock chart analysis you can do on your charts. But I believe your stock chart analysis needs will develop during your stock trading career.So it is important to use good
stock analysis software
which allows you to customize your stock price charts. I would recommend
Amibroker,
quite cheap but very powerful stock analysis software. I use it personally for more then 7 years already and I am very satisfied.
Return from technical stock charts to stock chart analysis
Return from technical stock market price charts
to simple-stock-trading.com
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