Homework 2: This Assignment Requires You To Go To Stock Char

Homework 2this Assignment Requires You To Go To Stock Chartshttpsto

Homework 2 this assignment requires you to go to Stock Charts and select a chart. After you have selected a stock and your chart, please describe the type of chart you selected and what the information describes.

Paper For Above instruction

In this assignment, I selected a stock chart from Stock Charts to demonstrate my understanding of different types of financial charts and the information they convey. The chosen chart is a candlestick chart of Apple Inc. (AAPL), which is widely used in technical analysis to understand stock price movements over a specific period.

The candlestick chart I selected displays daily price movements of Apple Inc. over a three-month period. This chart type visually represents four critical data points for each trading day: opening price, closing price, highest price, and lowest price. Each candlestick indicates whether the stock price increased or decreased during the trading day, with the body of the candlestick representing the opening and closing prices, and the wicks (or shadows) showing the high and low prices.

This type of chart provides valuable insight into market sentiment and potential trend reversals. For example, a series of bullish candlesticks with higher highs and higher lows suggests an upward trend, whereas a sequence of bearish candlesticks signifies a downward trend. Additionally, specific candlestick formations, such as doji, hammer, or shooting star, can indicate potential reversals or continuations in price movement.

The information conveyed by this candlestick chart includes not only the price levels but also the psychological state of traders, as reflected in their buying and selling behaviors. The chart helps traders identify entry and exit points, trends, and potential reversals based on price action patterns. Overall, this chart type is a vital tool for traders and investors conducting technical analysis, providing a comprehensive view of the stock's short-term price action and market sentiment.

References

  • Murphy, J. J. (1999). Technical Analysis of the Financial Markets. New York: New York Institute of Finance.
  • Pring, M. J. (2002). Technical Analysis Explained. New York: McGraw-Hill Education.
  • Constance, M. (2020). An Introduction to Candlestick Charting. Investopedia. https://www.investopedia.com/terms/c/candlestick.asp
  • Chande, T. & Kroll, A. (1991). The New Technical Trader. New York: John Wiley & Sons.
  • Schwager, J. D. (1996). Market Wizards. New York: Harper Business.

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