Investment Strategies - by R Ambrose

Technical Analysis

As with growth investors, technical analysts often ignore the fundamentals of a company. They decide when to buy or sell shares based on analysis of the share price graph of a company, making use of various technical indicators to act as buy or sell signals.

Technical analysts often have a short term view of the market compared to fundamentalists. They believe that charts follow trends and patterns that do not necessarily reflect the fundamentals of a company as the graph does not show how a company's absolute value is changing over time, rather it is describing how thousands of investors' opinions of the company are changing. So, if a company is increasing in value it could continue more than the company's fundamentals would suggest, as there is human psychology at work.

<<Previous   Home   Next>>

---

Disclaimer : Please note that these articles do not necessarily represent the views of UK Share Net. The views expressed are those of the authors. The price of shares can go down as well as up. No infringement of copyright is intended, any offending articles will be removed as soon as possible when notified.