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Start Stock Investing

To start stock investing the investor should consider his investment goals and investment time horizon. To start stock investing the investor needs to put aside investment capital and learn the basics of how stock prices move. Whether the investor is interested in penny stocks investing or wants to invest only in large cap stocks his investment goals will determine his investment strategy and trading tactics. It is important to start stock investing with investment capital . Investment capital is money put aside for investing and not money needed for the next month rent.

A standard rule of thumb to start stock investing is to pay off credit card debt first and have a small grainy day fund in the bank for emergencies. There is always investment risk in the stock market , especially for those beginning investing in the stock market. Beginning investors should never be confused about which money is their investment capital and which money is the rainy day fund. By learning the basics of fundamental analysis of stocks the beginning investor will be able to make rational judgments regarding long term investing . By using technical analysis tools such as Candlestick chart patterns the investor can profit from buying at the bottom of a price curve or exiting a stock position before a market reversal .

Investment goals differ. An investor may wish to put aside money for his retirement, for his children college educations, or for the purchase of a nicer home in the next few years. He will want to earn a better return on investment than from CD at his local bank. Over the years the US stock market has tended to outperform interest from the bank by a significant margin. To start stock investing for the long term investors should look to populate their stock portfolio with stocks that have both intrinsic stock value and a margin of safety . The forward looking earnings of a stock, its intrinsic value, are what make stock prices grow. A margin of safety in the form of cash or unencumbered assets protects a company against financial ruin in the case of stock market crashes or other financial disasters.

Whether the investor time horizon is his own retirement or a shorter term, buy and hold investing has its own pitfalls. Although the stock market outperforms many other investment opportunities the stock market rises as falls. The smart investor learns from stock traders . Stock traders seek to profit from the shorter term rises in stock prices. By the use of Candlestick analysis a trader is able to asset market sentiment during times of market volatility and market inefficiency . Although the market typically discounts stock fundamentals as soon as they are known, there are commonly periods of stock price instability as investors and traders buy stock or sell stock based upon their own individual fundamental and technical analysis. The smart investor will start stock investing by learning the skills of both fundamental analysis and technical analysis with Candlestick patterns in order to optimize profits in the stock market both in the long and in the short term.


Market Direction: Let the market tell you what the market is doing. That may seem like a oversimplified and overused statement for this newsletter but it is a tool that most investors utilize. The advantage of candlestick analysis is the visual depiction of what is occurring in investor sentiment. At times, the signals will be by a very strong buy signal indicating the start of a good uptrend or a good strong sell signal indicating the start of a strong downtrend. Obviously, that information is very valuable for how you position the portfolio. But too often, investors revert back to what they think the market trend is going to do, which is usually based upon what they hear from the so-called experts on the financial news stations. Candlestick analysis provides the information needed to make the appropriate positioning of a portfolio.

Private training session - If you are interested in a today private training session with Steve Bigalow along the shores of Keuka Lake, a beautiful Finger Lake in upstate New York, please make contact within the next few days. An assortment of schedules need to be put in place to get everybody to the Lake at the same time. The information you will gain from one of these private training sessions will affect how your out-look about investing for the rest of your life. If you are seriously interested in extracting profits from the markets on a consistent basis, you need to take advantage of the disciplines built into candlestick analysis. Click here for more information.

Chat session tonight at 8 PM ET.

 

Good Investing,

 

The Candlestick Forum Team


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