I have been studying about stock investment all around the world by many different authors (Obviously, i am still reading now) and i am going to give you all a simple Tips which i have concluded in most books.
Instead of "Buy Low and Sell High", we should "Buy Support and Sell Resistance". The most easiest way to trade in the stock market is to always find the Support of each stock as well as the resistance. However, we need to first identify the trend.
1) What is Support? It is a level on the chart where buying interest is stronger than selling pressure.
2) What is Resistance? It is a level where selling pressure overcome the buying interest in the market.
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| KLCI Trend by Trading View |
The Red Color line is the Support whereas the Green Color Line is the Resistance. The support line will be formed when the stock movement together with volume could not break through. Then a BUY signal appear. In the same, when the stock movement and volume cannot break through the Resistance Line, SELL signal appear.
For some investors, they will try to put a Buy signal on 28/12/2016 at 1630.3 (Support) and Sell Signal on 20/02/2017 at 1712.58 (Resistance). A beautiful profit could be make within 3 months.
In conclusion, earning in the stock market is not gambling. We should put more effort on doing some Technical Analysis or research, that's how we use money to earn money. Please remember, must always need to find the support and resistance together with a very high volume in order to gain the profit.
