Technical Analysis: Don't Let the Name Scare You

Technical Analysis: Don't Let the Name Scare You
 
Give a man a fish and you feed him for a day.
Teach a man to fish and you feed him for a lifetime.
 --Chinese proverb
 
My name is Sarah Potter. I'm a Mom and I make my living trading options. I didn't work on Wall Street. I don't have an MBA. I'm living proof that anyone can trade and make money doing it.

My goal in 2018 is to help more people than ever learn how to trade. I hope I can help you get started today. Or, if you've already been investing but aren't seeing the type of returns you want, I can help your trading improve.

I founded SheCanTrade to help people just like you to learn how to trade. Investors don't need to rely on a broker, or a robo advisor, or simply choose a random exchange traded fund (ETF) off list and cross your fingers. I can teach you the tools you need to trade and make extra money each month or even become a full-time trader just like me.

One of the tools I use every day to help find stocks to trade is Technical Analysis. Yep, the name can sound scary, but it really is a very intuitive and visual way of looking at the markets.
You've heard that saying that a picture is worth 1000 word? A chart of a stock is simply a picture of its price history – where it's been. I can help show you how you can use that "picture" to determine where the stock price is going.

It's All In the Charts

There is an old market saying "It is all the in charts." That means that all known "fundamental factors" (i.e. company revenues, management changes, new product offerings) are reflected in the current price of a stock. Traders don't need to know everything about every company to successfully trade it.  In fact, it is virtually impossible for an individual investor, to identify and understand every fundamental factor, which is impacting a stock's price. That's why charts are so handy.

Three Key Tenets

The three main tenets of technical analysis include the ideas that:

  1. All known news is discounted in the current stock price.
  2. Stock prices moves in trends.
  3. History repeats itself.
 
Trend is the Starting Point

A six year old can look at a stock price chart and tell you whether the price trend is going up or going down. It really is as easy as that to get started.
  • A stock price can go up.
  • A stock price can go down.
  • Or a stock price can go sideways.
The good news is that as an options trader, I can show how you to make money in all three of those scenarios. With limited risk. Really.

There is another popular market saying: "the trend is your friend." Technical analysis can help you find the trend and then pick specific entry and exit points for trading opportunities. Think of a stock chart as a roadmap for your trading.

A Flurry of Indicators

Once you start to dig in, you will find many different technical "indicators" that can offer additional signals and insights and help you become profitable.

There are a bunch of well, technical sounding names, like: Bollinger Bands, Moving Averages, Relative Strength Index, and more. But, I'm here to help break down the tools you need to learn about to make successful trades.

We keep it simple, easy-to-understand and transparent at SheCanTrade.

Stock Prices Form Patterns

Another part of technical analysis is pattern recognition. Patterns form on price charts in all sorts of easy recognizable formations like:
  • Triangles
  • Flags
  • Double  Bottoms and Double Tops
Patterns work because history repeats itself. People trade the markets and people are driven by emotions. Fear and greed have created many a bottom and top in markets throughout history.

Stock price movement often evolves in recognizable patterns around market turns or while a stock is "resting" and getting ready for the next big trend move.

Patterns can help you jump on a new trend and also help you identify targets to take your profits.

Let's Trade Together

I use technical analysis to pick stocks to trade and then layer that information onto the options chain to further refine my strategy.

Technical analysis is not scary, in fact, it's downright fun!

Let's get started together! Join my live trading room today. Or, check out my option trading courses here. Got questions? Email me here.

Learn how to trade and make the extra money you can use every month. Looking back, this could be the most important step you take in 2018. What are you waiting for?
 
Read More: 5 Trading Rules To Live (Or Die) By
 

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