Did you know that around 55% of adults in the United States have money in the stock market?
The stock market is a great way to add wealth and generate passive income for you and your family. However, there are things you need to know to find the best stocks, like how to read investment data.
Reading the data will help you find up-and-coming companies to invest in, and make choosing stocks a much surer thing. Reading the NASDAQ is a great tool to have at your disposal.
Continue reading to learn more about choosing investments and reading investment data.
How to Read Investment Data
Knowing how to read investment data helps you understand how a stock is performing and what is happening in the broader market.
Stocks have charts that show price changes, the current trading price, the historical highs and lows, as well as the dividends. Learning how to read stock charts and other investment data will have you reading the stock market like Evan Harvey NASDAQ.
Reading a Stock Chart
There are different things that you need to look at when reading a stock chart, like the plot lines.
It can be confusing at first, but here are a few things that you should do when learning to read a stock chart.
- Look at Price and Time Axis
Stock charts have two axes to look at. One is the price axis and the other is the time axis. The horizontal axis is the time axis and shows the value of the stock over a period of time. It can represent any period of time, from days to years.
The vertical axis displays the value of that stock at a given point in time. These two axes work together to plot trends of the stock’s value and provide the framework of the stock chart.
- Find the Trend Line
The trend line on a stock chart will tell you a lot about a stock’s performance. Different chart styles help you look at the trend line of a stock.
Line charts are used to chart the price changes of a stock over time. There are also bar charts, which look at the highest and lowest prices of a stock throughout a day.
- Identify Trading Volume
Another factor to look at is the trading volume of a stock. The volume is usually shown on the bottom of a stock chart in either green or red bars.
Trading volume spikes are valuable because they show the strength of a trend with a particular stock. If you see the price of the stock has dropped and the trading volume is high, that means there is a downward trend for that stock.
- Find Lines of Support and Resistance
Lines of support and resistance show when a stock is trading up or down. The support line is a line on the chart that indicates a certain price that the stock doesn’t fall below. It supports the stock and keeps it from selling below a certain price on the market.
The resistance line works the same way except that it acts as a ceiling. It keeps the stock from selling above a certain price on the market.
Start Investing Today
Reading investment data isn’t the easiest task, but it is an extremely valuable skill that is a great way to grow your wealth.
A big part of that is knowing how to read a stock chart. This knowledge will help you track trends and analyze how a stock is performing.
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