No handshake in market means danger

No handshake in market means danger

First ensure that the short term moving average is above the long term moving average, secondly the volume. Short term profit booking is normally made by investors at several intervals, it is important to identify whether the second phase is continuing i.e. the upper trend. Short term profit booking volume is very low. Here is a time to study the fundamental analysis and build a opinion on the technical charts for continuing or exit. Technical provide valuable clues as well as specific information about the stock. It may provide an advance reason and make you aware of the impending danger. This is so because smart investors are more informed about the stock fundamentally.

Now comes the point of handshakes. During an trend, the stock gives some intermittent pull backs. It is the moving averages which will tell us about the support the stock can possibly take. Observe the pull backs touching the moving averages and take informed decisions. Basic information that charts show us is

1. Whether the stock is in up trend

2. The stage of the stock presently (stage 1,2,3,4)

3. Whether the stock is close to its moving averages and its showing signs of renewed buying.

4. The prevailing market charts typically play in important role in selection decision making and timing the stock.

The author provides education on Fundamental analysis of Stocks.