Those planning to enter the stock market and is eager to know how this industry works, should check out the different types of basic and advanced courses that are offered by reputed institutions both offline and online. In order to select the most appropriate one, it is important to consider few things, so as to reap in the rewards from the course and enjoy making huge profits from this domain.
About Technical Analysis
Majority of the Trading options course that are offered are said to focus upon technical analysis. It is stated to be the study of demand and supply of the stock market. This is done by comparing movement history of the stock price including its volume (number of shares that have been traded). The course helps the learner to know the way how price moves with regards to high, open, closing and low prices on a particular given month, week, day, hour or minute. At the same time, it also allows comparing this to the volume, thus offering a better insight into the market’s future direction. Generally, the data that is displayed in the stock chart is found to be easily consumed.
Different study areas
Options trading classes generally fall into several study areas, which are given below:
- Demand and supply: Stock volume vs. price movement
- Trend following: Getting to know the latest trends
- Cycle and waves analysis: Getting to know about market movement, business cycles, Fibonacci Waves and Seasonal Cycles.
- Trend Interpretation: Draw Trend Lines: Resistance and Support Lines.
- Stock Charts: Price: Price plotting in charts for understanding the stock history, market or share index by using bars, point & figure or candlesticks charting.
- Price indicators: Priced based study on Oscillators or chart indicators called Stochastics, RSI (Relative Strength Index), ROC (Rate of Change), MA (Moving Averages), MACD(Moving Average Convergence Divergence), Average Direction Movement Index ADX, Parabolic SAR.
- Volume study: Getting to know about level of volume relationship with price, including price relationship with volume.
- Price Volume indicator study: OBV (On balance volume), MoneyStream, TSV (Time Segmented Volume), Chaikins Money Flow.
- Market Sentiment: Getting to know madness of crowds.
What does technical analysis course teach?
This course does bring in plenty of influence in the learner. As a matter of fact, it can help the person to understand better about stock market equation. It is stated to be the effect part and effect equation of the cause. Technical Analysis studies tend to offer the following:
- What: What has happened
- Market Action: What is taking place in real time at that point of time
- Effect: Not cause
Shortfall of stock market courses
The courses tend to fail in certain perspectives, since most of them focus exclusively upon technical analysis that could probably be misleading. Having understanding of just the technical analysis part might cause problems for investor or trader. The issues here are having no grasp of the company fundamentals or that of economics. Hence, the right course is to be selected that will benefit the aspiring trader in the long run.