TA can be a powerful tool in identifying trend reversals and entry and exit points. The best way to analyze the trading patterns of a stock is to look at a chart of it. We can't stress this enough. The purpose of this guide is to shed some light on the technical terms above. Having an understanding of these basic TA chart formations will make you a better, more profitable investor.
Timing is everything.
Even a basic understanding of TA will greatly improve the timing of your entry and exit points. And this can make a tremendous difference in the success or failure of an investment. Before we get into our discussion, we have to say that no technical indicator or system is perfect. There will be instances when the signal given is wrong. But in most cases, when TA leads you to a certain conclusion, the stock will behave in a way that's similar to what would be expected.