| Technical Analysis (TA) investors are often mistaken | | | | these repeated process can be fruitful, but the risk |
| as speculators or gamblers. In my humble opinion, | | | | associated with this kind of investment is higher. Even |
| speculators in the stock market are gamblers in the | | | | when all signals show indication to buy, just one bad |
| true sense where they buy and sell shares for no | | | | news can be disastrous to the investor. |
| apparent reasons. | | | | To become a successful TA investor, one must seek |
| It is true that in reality, TA investors ARE speculators | | | | knowledge of chart patterns, stock trends and the |
| in the sense that they try to predict the movement | | | | technical indicators. Investors must also be alert to |
| of stock prices base on past performance, but they | | | | the slightest movement of the stock market, as TA |
| are not gambling with their money because they also | | | | investors also use market psychology as a guide in |
| refer to other indicators such as the price trend, | | | | making their decision. |
| technical indicators, chart patterns and market | | | | For example, the investors must know the bullish and |
| sentiments or market psychology. | | | | bearish signals of the Japanese candlestick chart, |
| As the term suggest, the investors plan their | | | | support and resistance level of the stock price and |
| portfolio based on the technical aspects of the stock | | | | also technical indicators such as Bollinger Band, Moving |
| market. Contrary to FA investors, TA investors are | | | | Average, Moving Average Convergence-Divergence |
| usually short term investors where they buy and sell | | | | (MACD), Stochastic Oscillators and many others. Its |
| a particular stock within a few days time and they | | | | not easy actually to predict the market, there are |
| target small profit in each transaction. In the long run, | | | | many things that need to be taken into consideration. |