How to Analyze Stock Market Data

Analyzing stock charts can indicate whether an investor should buy or sell a stock.

Part of the difficulty of investing in the stock market is determining when to buy and sell stocks. Through analysis of stock market data, an investor can obtain a clearer picture of what is happening in the stock market and time the purchase and sale of stock. Timing the purchase and sale of stock involves determining price signals in the market. An investor can analyze stock charts on their own to determine stock price signals.

Things You'll Need

• Stock chart

Instructions

1. Enter www.stockcharts.com into the URL section of your Web browser at the top of your screen and hit enter.

2. Click "symbol catalog," which is on the right hand side of the screen in the "Start to Chart" blue box, to find the stock symbol of the company you want to analyze.

3. Click the letter corresponding to the first letter of the name of the company you want to analyze.

4. Scroll down the list to find the name of the company you are looking for.

5. Click on the middle button on the left side of the company's name.

6. Click "default sharp chart" on the top of the chart.

7. Choose weekly under the heading "periods" at the top of the chart and click update.

8. Determine if the stock price has broken the blue line from above or below. If the stock price has crossed the blue line from below, this is a signal to buy the stock. If the stock price has crossed the blue line from above, this is a signal to sell the stock.

Tips & Warnings

• The blue line mentioned in Step 8 is the moving average line, and its purpose is to smooth out fluctuations in stock price movements, which makes it easier for an investor to identify price signals in the chart.

References

• Stock Charts
• Marie Zukowski; Professor; Seneca College, Toronto, Ontario
• "Canadian Securities Course Volume Two"; CSI Global Education; 2008

Resources

• Read this Article in Spanish