| Why would you make a stock trend analysis? The | | | | that they cannot always win. If they lose sometimes |
| ultimate goal is of course to make some money. | | | | or if they are wrong sometimes, they shall not be |
| Nobody or very few people only are spending time | | | | discouraged. Success here can only be measured in |
| investing their money in the stock market just for | | | | the long run. |
| fun. The objective is of course to make money. The | | | | Now let's go to the next point in this explanation why |
| exception here is maybe those people who analyze | | | | someone would be making a stock trend analysis. If |
| trends as a profession for their employer. They get | | | | this is done to predict the future and to make |
| paid to do the work. But I guess when they see | | | | money eventually, why would you trust that |
| some good trends; they put their own money behind | | | | something like this works? Now we could list here all |
| them as well. | | | | the books and articles that have been written about |
| So, next question then. Why would making a trend | | | | the successes that investors have had with trend |
| analysis help you to make money on the stock | | | | investing by following stock trends. That goes |
| market? The answer is simple; to predict the future. | | | | beyond the scope of this article. |
| But nobody can predict the future you would say. | | | | We want however to point out a simple visual check |
| Correct, neither with crystal ball gazing nor with | | | | that you can do right now yourself. Have a look at a |
| performing stock trend analysis can you predict the | | | | historical chart of a stock market index that shows a |
| future with certainty. | | | | time span of more than a decade. It is easy to see |
| The idea here with Stock Trend Analysis is that you | | | | the trends up and down. It is also easy to see that |
| make a prediction for the future and that you have a | | | | these trends lasted for many months and often |
| higher probability to be right than to be wrong, on | | | | many years. It is then common sense that when |
| average. You can never say for each individual | | | | stock trend analysis can identify a trend rather early |
| situation what the outcome will be. But the principle | | | | in its existence, and the prediction is more often right |
| idea behind making a trend analysis is that you can | | | | than wrong, good money can be made by riding the |
| be more often right than wrong. | | | | wave of the trend. |
| Thus being wrong on a regular basis is inherent to | | | | In summary, investors make and rely on stock trend |
| doing a stock trend analysis and making based on | | | | analysis to earn good money in the stock markets |
| these predictions for the future. People who are | | | | by being more often right than wrong when |
| making predictions based on this analysis or investors | | | | predicting the future based on existing trends in the |
| who are putting their money behind these trends | | | | market. |
| have to accept that they cannot always be right, | | | | |