How to Analyze Stock Charts With FB Example

Learn to Use Powerful Worden TC2000 Indicators   
Yesterday TechniTrader held the Open Forum Training Event as we do once a year. This is totally different than my webinar presentations to non-students. It was as always, a mega surprise to the attendees who were blown away by the training. 
What I do is let a “By Invitation Only” group of registered website guests who are non-students, see how I analyze stocks and the market. This webinar is live, using real charts. Attendees may submit a stock for analysis to see how I analyze their stock picks.  
I was struck by one compelling common denominator in that list of stocks. There was not one single good stock pick for short-term trading, among all of the stocks submitted for analysis by the attendees. 
This is totally different from when I hold my TechniTrader Student Mentoring Sessions. When TechniTrader Students submit stock picks for analysis the bulk of the charts have good setups for entry or are developing great setups for entry, and the stocks meet all requirements for a watchlist.

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The attendees ranged from brand new traders to veterans of 30 years, so it had nothing to do with experience. Rather it is a glaring reality that most traders are handicapped by a lack of proper chart training. Sure you have been to dozens of Worden Seminars but those are not intended to teach you to trade, but to buy their charting software. So big holes are left in your understanding of stock charts, AND how to use Worden Indicators.
As TC2000 Users you have 3 extremely powerful Worden Indicators at your fingertips, yet few of you use them. You are missing out on substantial chart analysis information, that would help you achieve higher profits with less work.
Facebook Inc. (FB: NASDAQ) is a very popular stock in retail chatrooms right now. Let’s use it as the example, see chart below.
facebook inc. chart example - technitrader

Use the chart to learn how to analyze Stock Charts with FB example to determine the following:
1. Where are the support levels in this chart?
2. Is there momentum potential action, and is run gain potential down or up? 
3. Can you identify weaker versus stronger previous price candlestick patterns and trendline patterns in this chart?
4. Is this good stock for Day, Swing, Momentum, or Position Trading? 
5. What are the Volume and Balance of Power BOP indicators telling you before FB gaps down?   
6. Do you know where to put a PROPER stop loss? If you think stop losses do not work, then you are not placing them properly. 
7. What Trading Style would work best, and which strategy should you use for that trading style?
8. Which Market Participant Group is in control of price right now? 
Print off this chart. Draw on it. Study the overall trend. Look at different time frames. Do not have so many indicators on the price chart, that you cannot read the pure price action. You should not be using more than 5 indicators, and most of those need to be Quantity based indicators. If you do not have a good set of indicators, study the ones provided with this lesson.
Let’s see how you do with this analysis on you own. I will provide my analysis of Price and Volume action for FB next week. The goal is for you to be able to pull up any stock chart and quickly decide if it is a good pick for your Trading Style, as well as knowing which strategy to use at the time based on current Market Conditions.
Your ultimate goal in understanding how to analyze stock charts with FB example should be to have the ability to know what style and which strategy for that style to use, the risk versus reward profit potential, the hold time, the run gain, and the stop loss placement. My goal in my retirement years is to teach Retail Traders to trade profitably all the time, not just once in a blue moon. If you do not learn how to do this kind analysis on your own, you will forever be dependent upon vendors, High Frequency Traders HFTs, and Professionals who will always take advantage of you. 
Next week’s article will be my analysis of the FB chart, which you can use to compare and check against what you have determined.
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Trade Wisely,
Martha Stokes CMT
TechniTrader technical analysis using TC2000 charts, courtesy of Worden Bros.

Chartered Market Technician
Instructor & Developer of TechniTrader Stock and Option Courses
TechniTrader DVDS with every course.

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Disclaimer: All statements are the opinions of TechniTrader, its instructors and/or employees, and are not to be construed as anything more than an opinion. TechniTrader is not a broker or an investment advisor; it is strictly an educational service. There is risk in trading financial assets and derivatives. Due diligence is required for any investment. It should not be assumed that the methods or techniques presented cannot result in losses. Examples presented are for educational purposes only.