Investing in the stock market nowadays can be made more affordable and less risky than it has ever been, the advent of charting software and dealing facilities has made Online Stock Investing an excellent choice for investors.
To the unprepared, untrained investor this is not going to make any difference to their bottom line, if they were losing money while dealing offline they will just continue to lose dealing online, but to the savvy investor, online stock investing makes a huge difference!
In regards to technical analysis, it would be possible without online charting facilities and software, you would not be able to spot technical setups and leading – lagging markets.
Traditional Investing vs Online Stock Investing
Traditional stock investing, which involved dealing through the telephone was unreliable, you could have to wait as long as 30 minutes for your order to be filled, and by that time it may have been too late. Today you can deal electronically and as long as you are dealing through a good stockbroker, and on liquid stocks you should not have any problems getting your orders filled.
Then there’s the 100% electronic markets such as the E-mini SP500 futures which is often traded by stock traders as a hedging tool for short term alternative to stocks, there’s no human involved in the dealing of these futures contracts whatsoever!
This is why Online Stock Investing and the related futures and options products offer a unique powerful platform, which to the savvy stock trader means a more stable and clearer market.
Online Stock Investing – Empowered Technical Analysis
In the last 15 years technical analysis has actually improved, of course technical analysis it’s not as simple as many books would have you believe, for example “A head and shoulders formation means sell and the reverse means buy”.. that is certainly not the case, but setups like converging trendlines, and moving averages are being watched by thousands of traders and even large traders, this is all made possible through online charting and faster, coordinated online trading.
Why did markets reverse right at that 200 day moving average, or why did they rally once above a 3 month long trendline? It all happened because thousands of traders and investors did the same trade at the same time, thereby reversing the trend, and it has been made possible thanks to online stock investing and its facilities.
Online stock investing has reinforced technical analysis
Back in the late 70s those trendlines in the above chart would have been much, much less reliable and you could not count on mass psychology with such accuracy. Of course, the risk is still there and that’s what it is that makes the markets tick, you have to realize that everyone makes money only when markets go up!
When they go sideways or down, then you have one loser for every winner (Dollar for dollar). Online Stock Investing has really enhanced technical analysis and the more experienced traders know it, to them it has made a big difference.
Stock Investments Tips and Market Speculation by..
Scott Smith – Investing In The Stock Market © 2008 – 2010
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