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Best indicators for stockanalysis 📈💵

Generally, stock analysis can be divided into two main categories: technical analysis and fundamental analysis. Both have their own sets of indicators.









Technical Analysis Indicators:

Technical analysis focuses on historical price and volume data to identify patterns and potential future price movements. Here are some of the most popular and well-regarded indicators:

  • Moving Averages (MA): Smooth out price data over a specific period to identify trends and potential support and resistance levels. Common periods include 50, 100, and 200 days.
  • RSI (Relative Strength Index): A momentum indicator that measures the speed and change of price movements. Indicates whether a stock is overbought (above 70) or oversold (below 30).
  • MACD (Moving Average Convergence Divergence): A trend-following momentum indicator that shows the relationship between two moving averages. Signal line crossovers can indicate buy or sell signals.  
  • Volume: Analysis of trading volume can confirm the strength of a trend or signal potential trend reversals. High volume during a price breakout can be a strong sign.
  • Support and Resistance: Identifying price levels where the stock has historically struggled to break through (resistance) or has found a bottom (support) is important for understanding potential buying and selling opportunities.

Fundamental Analysis Indicators (Key Ratios):

Fundamental analysis focuses on a company's underlying financial health and value. Here are some important key ratios and areas to analyze:

  • P/E Ratio (Price/Earnings): The stock price divided by the company's earnings per share. Indicates how much investors are willing to pay for each dollar of earnings. Often compared to industry averages and the company's historical P/E ratio.
  • Revenue Growth: How quickly the company's sales are increasing. High growth can be positive, but it's important to analyze its sustainability.
  • Earnings Growth: How quickly the company's profits are increasing. An important indicator of the company's profitability and efficiency.
  • Dividend Yield: Dividend per share divided by the stock price. Indicates what percentage of the investment is returned annually in the form of dividends. Important for dividend investors.
  • Equity Ratio (or Solvency): Indicates what proportion of the company's assets is financed by equity. A high equity ratio indicates a strong financial position.
  • Liquidity: The company's ability to pay its short-term debts. Key ratios like the current ratio and quick ratio are important.
  • Debt-to-Equity Ratio: The ratio between the company's debt and equity. A high debt-to-equity ratio can imply higher risk.
  • Gross Margin and Operating Margin: Measure the company's profitability at different levels.
  • Future Prospects and Market Analysis: Understanding the company's industry, competitive position, and future potential is crucial in fundamental analysis.

Best tool for stockanalysis: In my opinion TradingView is far the best tool for analysis of stocks, crypto and commondities. It offers a wide range of real-time data, advanced charting tools, technical indicators, and social networking features for traders and investors of all levels. Users can analyze price movements, share their analyses, and interact with a large community. TradingView offers a 30 days free trial of any subscription and as a partner with TradingView I offer you $15 to pay your first subscription month with if you use the button down below. 



Conclusion:

Many successful stock analysts use a combination of both technical and fundamental indicators to get a holistic view of a stock. It's important that you learn how different indicators work, understand their limitations, and adapt your analysis to your own investment style and goals. Feel free to experiment with different indicators and combinations to find what works best for you.


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