What Are Stock Market Technical Indicators and Should You Use Them?
October 25, 2017
In the stock market, data is everything. If you are going to want to find success and profit, you need to be able to study a graph (whether it be bar or candlestick) and know what it’s telling you. This is because the charts actually tell you what a stock is doing. With this information, you can see when a stock is building momentum or swinging wildly and can use this to make a decision on where to position yourself.
One aspect of technical analysis that is often questioned is the use of technical indicators. Some people think they are very useful and offer a better calculation of a price’s average, whereas other believe they’re a waste of time and don’t share any useful information.
If you don’t know what technical indicators are or how they are useful, all will be explained in this article. With this information, you can make a decision as to what use you believe technical indicators have in the stock market.
What is a Technical Indicator?
In their simplest form, technical indicators are data points on a price chart. They are little points that are calculated using the price data and there are various formulas that can be used. Before going on, it is also important to understand that there’s two different types of technical indicators: leading and lagging. The two are very simple. Leading technical indicators lead the price action, whereas lagging indicators follow the price action. When calculating the indicator, various values are taken from the price data, including open, close, high and low information. The volume is also included occasionally. But, what exactly do these technical indicators offer?
What is the Point of a Technical Indicator?
The main point of a technical indicator is to offer an alternative perspective on the price action. The two different types of indicators are supposed to tell you various information about the price of a stock and possibly when a big event is about to happen. They can be used for different things and there are different indicators to do different jobs. For example, moving averages are simple formulas and measure the average price of a stock over a period of time, whereas stochastics are more complex.
How Would You Use a Technical Indicator?
There are many different ways you could use a technical indicator, and investors tend to use them differently. However, it is important to know that you shouldn’t rely on technical indicators completely and should always look at the data as a whole. Apply them to your technical analysis but not never use them on their lonesome.
- To alert – Some traders use technical indicators are an alert system. They can indicate when there is a lot of change happening in a stock’s price and can provide some insight into what’s going on.
- To confirm – Technical indicators can help confirm other technical tools. They can be used to confirm breakouts and can offer support for other fluctuation picked up using other analysis.
- To predict – Some traders use indicators to predict the pattern of stocks, but this is a little risky.
Technical indicators do offer some insight into technical analysis but don’t show anything more about the data. Some traders believe they help simplify the analysis and offer an additional insight into the movement of a stock. Others think they’re a waste of time. Although they provide no extra information about a chart, they do help when it comes to alerts and confirming movements. If you have a specific strategy and if indicators are working for you, then continue to use them. The preference is entirely subjective.
What to Look for In Your Stock Market Trading Platform
September 14, 2017
The online stock trading is on a boost these days and the scenario is going to create a big adventure in the coming future. That is why most of the investors and small as well as big business owners these days are searching for the best deals to spend on shares. In this digital world, it is probably the best way to multiply your profits but to do this you need to choose trustworthy and reliable trading platform. Yeah! That is a most difficult task because if you choose the wrong one, you may get exposed to risk in coming future.
Okay! Don’t worry! When you have already decided to invest in stock trading then we can help you to select the best platform to get started. Below are few tips to search the best stock trading platform out of a big list available online.
This is the most important thing that you need to check before joining any share or stock trading platform. Brokers usually prefer to charge a different amount for transactions but it must be a genuine range that cannot harm your profits.
What are the trading options?
Every trading platform use to follow different trading options; few of these allow trading on local companies whereas others may also provide access to international market. In few cases, you may also have easy access to currencies, indices, forex, and CFDs. So, you need to choose a platform of your interest with proper research.
A good stock trading software platform like Esignal provides fast responses to market shifts so that investors can take benefits from these ups and down. When your trading platform is fast enough then you can make precise and fast deals to achieve higher profits and it can definitely create huge differences in your finances.
Easy access to market data:
The trading decisions always depend on market fluctuations so your platform must be capable enough to reflect all the details. It should include well-researched information and analysis offered by experts so that you can have accurate insights towards best trading decisions. The stock charts must be well maintained and easy to understand for casual as well as professional users.
Great Charts and Level 2
A good trading platform will give you access to high quality charts and level 2 screens. You’ll want a platform that has candlestick charts (or whatever you use) that allow for an advanced array of technical indicators.
You will also want access to real-time level 2 data. This gives you insight into the real-time supply and demand levels of the stock market. Some platform providers will charge extra for the real-time data while many brokers will include it for free.
Customer Support System:
Well, no matter whether you are a beginner or an experienced trader, it is always essential to have fast customer support service with your trading platform. Always prefer to choose a platform that ensures 24×7 hours connectivity with its support team so that you can have immediate access to those professionals whenever any trouble occurs with your order entry. The fact is that just a small mistake or bug on the network can lead to big losses in seconds so active customer support system is really important.
All these features will help you to find a best stock trading platform for you. First of all, you need to consider your trading needs depending upon whether you are an expert, active or casual trader then you have to check all above features to choose the most suitable level 2 trading platform to meet your requirement. Soon you will be able to make best financial investments.