| One of the most important tools for investing is | | | | The candlestick charts provide a very clear view of |
| stock charts. The information they contain is | | | | how a stock has been trading, and through the |
| extremely valuable and tells us important information | | | | different visual representations and combinations of |
| on how a stock is moving. There are a number of | | | | candlestick patterns, it is possible to see the trends. |
| different types of stock charts, but the candlestick | | | | For example, one candlestick pattern called a doji, |
| chart is considered the more superior when it comes | | | | when represented alone, is neutral. However, when it |
| to technical analysis of a stock. By using stock | | | | is preceded by other candlestick patterns, it provides |
| charts, technical analysts are able to identify patterns | | | | important information. If after an advance in a |
| and trends of a particular stock. They look for | | | | stock's price a Doji appears on the stock charts, it |
| patterns such as the head and shoulders or double | | | | indicates buying pressure is starting to weaken. |
| top reversal patterns, to name a few. They also look | | | | Again, if a stock price has been declining and a Doji |
| for other indicators such as lines of support and | | | | appears, it would mean that selling pressure is |
| resistance, and many other more obscure indicators. | | | | starting to weaken. This could indicate that a reversal |
| Stock picking is considered an art by many, and for | | | | is near, but other patterns would still be required to |
| this reason, those who are trading stocks will put a | | | | affirm this action. The direction of a trend can be |
| lot of time and effort into chart analysis. There are | | | | found by using trend lines or moving averages. When |
| various schools of technical analysis like candlestick | | | | you receive a stock tip from your broker, it may be |
| charting, Dow Theory or Elliot wave theory. Some | | | | that he has identified a point of reversal and he |
| analysts may combine various techniques while others | | | | advises you to take a position in the stock. To find |
| stick with one. Finding a good stock pick on the | | | | out more about using stock charts, search for the |
| stock market will require you to use one of the | | | | many resources available online. You can also find a |
| methods described before. Technical analysts will tell | | | | stock market video that details how to use |
| you that prices move in trends. This may be up, | | | | candlestick patterns. |
| down, sideways, or as a combination. | | | | |