First of all, last Thursday, September 25, 2014 was my birthday, do you wanna ask about my age? Well its simply getting younger as it gets and I can’t just believe it…hahaha. I also wanna say “THANK YOU VERY MUCH” to all who sent their wishes on my most special day of the year 2014, that made it more special knowing that few people still remember my birthday. Again from the bottom of my heart “THANK YOU VERY MUCH”.
During that same day I was one of the privileged individual to join the seminar on “A PRIMER INTO TECHNICAL ANALYSIS” conducted by Mr. Juanis Barredo, VP-Sales & Customer Support, Chief Technical Analyst of COL Financial Group Inc. Here is some of my picture of him during the seminar.
Here are the Topic Outline:
- What is Technical Analysis
- Spotting and Following Trends
- Understanding Corrections and & Area Patterns
- Technical Indicators
- Establishing the Trading Plan
WHAT IS TECHNICAL ANALYSIS?
Technical Analysis is the study of price movement of any type of security pictured into a graph or chart, for the purpose of spotting & following price trends.
THE STUDY OF PRICE
Price Discounts Everything
- The market prices tells you everything you need to know about a stock market expectations.
Price Movement Trends
- An object in motion tends to stay in motion; while an object at the rest tends to stay at rest
History Repeats Itself
- People will tend to react in similar fashion to certain kinds of stimuli, grooming repetitive patterns of price activity.
LOOKING AT PRICES THRU GRAPHS
OPEN – the first price a stock trades at
HIGH – the highest price it reaches in a trading day
LOW – the lowest price is tags during a trading day
CLOSE – the final trading price of the day
LOOKING AT PRICES THRU GRAPHS
Advantage of looking at graphs/charts:
- See and analyze information fast
- Spot trend movements and changes
- Scope out and study many possible instruments (indices, stocks bonds, commodities, currencies..)
STUDYING VOLUME WITH GRAPHS
Volume – measures the number shares or value of those shares that trade in a day
- It can confirm your suspicions about a trends forcefulness
- Volume usually expands along with a trends
- It drowns away when trends are weak and falling
PART 2: SPOTTING AND FOLLOWING TRENDS
SUPPORT AND RESISTANCE
Support is a price point underneath a market that shows heaviness in buying sufficient enough to prevent prices from falling down
Resistance is a price point above a market that shows heaviness in a selling sufficient enough to prevent prices from rising up
Trends are durable swings in market conditions; they show the general direction of a securities’ price overtime
TRENDLINES are guideines that follow a trend that connect several areas of support or resistance to project buying or selling action over time
State your time period:
Short Term: From 3-6 months
Medium Term: 6-9 months
Long Term: 9+ months
TRENDLINES IN ACTION
- Buy closer to pullbacks to support of an up trendline or a breach of a down trendline
- Hold as long as your trendlines do not break
- Sell when your up trendline breaks
Whoaaa!!!…I hope this will make sense to all that will be reading this post…OK, for the meantime I would like to pause for a break since my daughter is hurrying to go to a mall where she will play in the children zone since it is a weekend and we have this schedule reserved for us to bond together. I will be posting the parts 3 & 4 on this Technical Trading Analysis next weekend. But before I will end this let me share to you this quote: