Stock Charts For Dummies

Chapter 20

Using Your Charts to Inform Your Buy, Hold, and Sell Decisions

IN THIS CHAPTER

Quickly finding strong areas of the market

Holding your winners (while keeping your cool)

Selling winners and losers

You will never hear a CEO announce to shareholders that it’s time to sell the company’s stock. That role is specifically left to investors and traders. Deciding when to buy a stock and when to sell a stock is your decision. Nobody in the markets thinks it is easy to actively work the markets. It takes time, commitment, and patience. Buying the stock of great companies with beaten-down prices takes a lot of courage. Buying the stock of great companies hitting new highs takes just as much courage. In this chapter, we take a look at how to use charts to help improve your decision making on buying, holding, and selling stocks.

Separating the Strong from the Weak

Focusing on strong stocks is one of the most important themes of the market. Usually those strong stocks are part of a strong sector. We have multiple methods of finding strong stocks and sectors with technical analysis. Three of these are covered in depth in Chapter 12 on relative strength:

• StockCharts technical ranking ...