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Learn to Read Stock Trends

monarchcb.com - Stock price movements are very energetic because the stock market is a group of investors who have different and special attitudes, and different styles in the stock business.

For this reason, investors must practice how to read stock movement styles so that they don't misquote decisions, which can cause losses.

"Stock trading does not only require knowledge, but also art. The most important thing is how we are safe with the strategy we choose to get maximum profit," said Dwi Cahyo, a technical analyst who deepened Ichimoku's strategy in a nursery training held by the Investa community, recently. .

For him, everyone has a different strategy because the desire and duration used to pay attention to price movements are also not the same." If people are busy with schedules, a short time trading strategy (one day trading) is definitely not suitable. It could be more suitable for capital. with a medium or far time horizon," he added.

Style, he said, is a trend or situation where there is a type of movement that leads to a stock price or stock chart and its character continues.

There are 3 styles in the stock market

1. Bullish Trend

Starting from the accumulation phase, it is the period of time when investors who "have data" carry out buying or selling behavior actively, contrary to the usual view of the market. At this stage, the price of the legacy does not change much because the investors who have the information are in the minority.

After that it entered the stage of panic buying." When the market began to "bump" and "copy" the original investors, then price changes quickly occurred.

In the second stage, investors with technical platforms began to participate. Stage 2 then continues until thinking begins to mushroom.

After the thought spread, investors who understood in the early stages began to let go of the legacy they held or what was called the excess stage.

2. Bearish style

The stage begins with distribution in a grand manner until there is panic selling and then continues until there is a signal to end.

3. Sideways style.

In this stage, the price movement up and down in a fairly small limited range.

Then, if investors are obliged to buy or sell shares? Before trading, you must first analyze the stock you want to buy.

  • Ensure the capital duration horizon.
  • Use technical analysis charts to look for canyons to determine support, and look for the highest price at close to confirm resistance.
  • Style confirmed by trade load.
  • The stock market has forecast all the information.
  • Money market indicators are required to confirm each other.
  • The style will always continue until a clear sign appears that the style has finished. "If the style is bearish, buy it right when the cost has successfully bounced. And vice versa," said Dwi Tjahjo.

In order not to be left behind in reading styles, investors need to pay attention to the shares to be purchased so as to get the maximum profit. Because from observations so far, retail investors are often too late, and buy at the top of the price when the bullish stage has shown signs of ending.