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Understanding the twists and turns of live market charts

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Understanding The Twists and Turns of a Live Market Chart
A stock market, share market or equity market, is the combination of sellers and buyers of shares, which depict ownership of the business. Share market is an important part of the free market economy. Shares of the public company are listed here, which are purchased and sold by investors. Stock market lists security type bonds such as convertible and corporate bonds as well as equity shares.
There are two kinds of the market in share market. They are primary share market and secondary share market.

  • Primary Stock Market: A business organisation enters the primary market to raise funds either to expand a business or to guard itself against possible future loses. The company registers in the primary stock market to raise funds through shares. When the company is registered and selling its shares for the first time, it is named as IPO or Initial Public Offering, after which the organisation is listed on the secondary stock market. Before the company registers itself for IPO, the organisation needs to furnish the details of its business, financial status, price band, etc.

  • Secondary Stock Market: Here trading happens with already listed shares. Here traders buy and sell. Some investors aim for long-term, some trade for short-term, and some day-to-day transactions are held. In the secondary market, investors can sell all their shares and exit from the financial market.

Exchanges of Stock Market
The stock market has two main exchanges – Bombay Stock Exchange (BSE) and National Stock Exchange (NSE). Major trading takes place in these two exchanges. Bombay stock exchange, first in Asia, was initiated in 1875. In 1992, National Stock Exchange was found. NSE and BSE follow the same principals of trading shares. Bombay Stock Exchange as of March 2017 ranks 11th on the world stock exchange and the fastest trading exchange in Asia. National Stock Exchange ranks 12th on the world stock exchange as of 2016. There are two indices in Indian stock exchange, Nifty, and Sensex. The Securities & Exchange Board of India (SEBI) is in charge of both NSE and BSE. Rules and regulations are levied by SEBI.

Twists and Turns of Market
The highs and lows of the stock market have to be carefully observed by the investors. Few aspects of the live chart are as below:

Support and Resistance:
The ideal way to recognise the goal price is to recognise the support and the resistance points. The support and resistance (S&R) are particular sum points on the chart. They are going to attract paramount quantity of either selling or buying. The support price is a rate at which the percentage of investors is more than sellers. One can see more sellers than investors during resistance price on the live chart.

  • Support: Comprehending the support level is very simple.  The support prevents the further downward trend of share prices. The support is a rating point on the live graph where sellers and buyers anticipate utmost insistence in the purchase of shares. At whatever time the share price fall near the support line they are going to rise again shorts. This level blows the present market price. The chance of share price fall till the demand is absorbed by the market and then there is an upward trend in the share prices. It often prompts buyers to buy shares.

  • Resistance: It is something that holds the price increase. The resistance level is a sum on the live market chart where investors expect extreme allocate of stocks for selling. This level is invariably over the prevalent share price. The likelihood of the shares rate ascending up to the resistance level, strengthen, absorbing all the share supply, and the downward trend is high. The resistance is the major stock market analysis tool, which the sellers and buyers look at the opening of the market. It acts as a catalyst to sell stocks. On an independent basis sellers and buyers can use S&R to recognise trade access as well.

52-week high-low: This is another important chart indicator for traders. It is the indicator of how the stock has traded in the last year. The market gurus believe that this is a vital component in determining the share’s present as well as future performance. A popular tactic the traders follow is they purchase shares after a particular stock crosses the 52-week high or low. The logic behind this approach is if the share price crosses the 52-week high/low either upward or downward trend the stock would have enough room to move towards a positive trend. The trend 52-week high/low is based on the stock price range at the end of market day. Sometimes few stocks during intra-day would have crossed the 52-week high mark, but towards the end of the market, the day would lose its momentum and hereby those stocks go unrecognised.

Advance-Decline Ratio: This is an indicator to measure a number of shares that have moved forward and there is an increase in price and the stock numbers which has fallen down. It is generally expressed in a ratio. A/D is a confirming indicator along with other market instruments. It is a vital tool to study the downward and upward trend of the market.

Volatility: During this phase predicting the share market trend is very tough. It can be ascribed to trader’s behaviour and sentiment. If there is an upward trend in the stocks, it is believed that market will do well in the coming days and vice versa.
The share market aids investors to grow financially. Having said that, it is very vital that the investors before trading make a thorough research about the stock they want to invest in. Watch the chart trend of the stock, 52-week high/low, predict any external factors that are impacting on the stock price, etc.

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