What is penny stock technical analysis?

Technical Analysis 101

Penny stocks are high-risk high-reward investments & trading them can make you serious money if you can minimize losses. One great way to minimize losses is by learning & using technical analysis to plan and execute trades.

Which is why in this article you will learn the basics of technical analysis & how you can start using it today, along with proper due diligence.

What is technical analysis?

Technical analysis is a method of forecasting the direction of prices through the study of past market data usually in a graphical chart format. In simple terms it is a way to use "technical indicators" to find predictable price patterns for a particular stock.

How to get started with technical analysis?

Getting started with technical analysis is easy. All you need to start technical analysis is reliable charting software, a stock ticker to investigate, and a sound understanding of the technical indicator & chart type that you wish to use.

There are several chart types to choose from. The 3 most popular chart types are line charts, candle stick charts, and bar charts. There are also several technical indicators to choose from as well.

Technical indicators are any class of metrics whose value is derived from generic price activity in a stock or asset. Technical indicators are usually used as "over-lays" on top of a particular stock chart so you can easily see them.

An Example of a technical indicator is the RSI or Relative Strength Index. The RSI lets us know if a stock is considered "oversold" or "overbought" based purely on it's price history and not it's fundamental value.

A score of 50 is considered stable, 30 or lower is considered oversold, and 70 or higher is considered over bought. The RSI indicator is usually found directly on top of a chart.

Where to find technical analysis software?

Software for technical analysis is offered by most online brokerages such as Etrade or TD Ameritrade. If you don't have access to technical analysis software through your brokerage http://stockcharts.com is a great place to go to for quick online analysis.

Stockcharts.com allows you to pick a chart type & choose from more then 30 different indicators to use on any given stock ticker including penny stocks.

Closing Words

Technical analysis is extremely useful for traders, and can help you make serious money from penny stocks by minimizing your losses, and maximizing your gains.

By mastering a few technical indicators you can come up with a winning strategy & a winning trading plan.

For getting more guidance regarding penny stocks, subscribe to our free penny stock newsletter.

Happy Trading.

Disclaimer

Fast Moving Stock does not own any shares or plan to get a position(s) in the company(s) anytime soon. Moreover, we have not been compensated for the posting of this article/report/analysis, as this is just an opinion of our writer/contributor. Not recommandation to buy or sell any stocks Read full

This entry was posted in Penny Stocks and tagged , , , , , , , , , , , , , , , , . Bookmark the permalink.
  1. Penny Stocks and Stock Picking Robots 0 comments | by Thomson Burberry | posted on March 24, 2012
  2. USA Telecom Services Providers Scored Burning Volume: (NYSE:T), (NYSE:VZ), (NASDAQ:WIN), (NASDAQ:FTR) 0 comments | by Steve Macintosh | posted on January 10, 2013
  3. Stock Quotes 0 comments | by Thomson Burberry | posted on September 30, 2011
  4. News Details 0 comments | by Thomson Burberry | posted on September 30, 2011
  5. After Another 80% Gains Yesterday. New Play Is Coming Tonight 0 comments | by Thomson Burberry | posted on May 23, 2012
  6. Get Ready For This Penny Stock Mineral Rite Corporation Could Be The Talk Of The Entire OTC Tomorrow. 0 comments | by Thomson Burberry | posted on April 24, 2013
  7. Gold Got Investors Rushing Into This Undervalued Gold Mine Company 0 comments | by Thomson Burberry | posted on November 1, 2011
  8. Basic Material Sector Valuable Stocks to Watch: (NYSE:AA), (PINK:CERP), (NYSE:ANR), (NYSE:VLO) 0 comments | by Thomson Burberry | posted on January 18, 2013
  9. Recent Winners 0 comments | by Thomson Burberry | posted on September 29, 2011
  10. 0 comments | by Thomson Burberry | posted on September 29, 2011

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>