Basics of Stock Analysis – Stage 4

The stock price is driven by demand and supply. when the demand is high the price goes up and when the supply is high the price goes down. There are two major types of analysis. Fundamental Analysis is studying a company directly. Fundamental analysis can be done only by strong hands as they have access to the data first. Technical analysis is following the market in terms of Demand & Supply and following the trend which makes it very reliable, but the major drawback is it fails to give you the big picture like the future of the company and fails to predict the sector movement. There are four major types of charts. Line charts, Bar charts, Candlestick charts and Point & figure charts. Of these Candle sticks can be used to get the details about short term swings in stock price movement. It also gives the details about open. close price which the line chart fails to give.