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Thursday, May 6, 2010

Technical Analysis

I still remember when I used to be a naïve to Technical Analysis. The remembrance of some of the mistakes I committed in those days makes me laugh. How stupid I was. But that’s the way one learns if he/she doesn’t have any mentor or godfather. I too started learning by and with mistakes. In my early days I picked stocks who had seen a drastic drop in recent days. The notion behind the selection was “ the stock has already dropped a lot , now its turn to move up” .


Well, later I learnt about moving averages and still believes that moving averages are crude and simplest way of learning technical analysis.

If we firmly believes the existence of TA doctrine and want to encroach upon, moving averages gives us easy way. A beginner doesn’t know when to buy or when to sell. So moving averages, if properly handled , give enough guidance to keep him from incurring prospective losses.

Below are some pictures of NF with 50 moving average and even a naïve can understand the timing of buy/sell. It a simple beginning.








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