Technical analysis: learn to invest your money at the right place

Technical
analysis

learn to invest your money at the
right place

Making money is important but doing it smartly is all
we want, in this whole series we will learn how to
read the chart patterns? How to trade stocks? Buy
and sell stocks based on this reading and many
more… I know many people who want to start
investing and have got rid of lame tutorials on a
video. In this series we have created something
simpler than an advanced tutorial, something you
and I can understand easily, something that helps
people who have never traded in their life to make
their first trade. We wanted this course to be simple,
and have depth but most importantly, firststands
wanted this course to be free. After reading this
whole series I can promise you that your
understanding of trading, reading price charts,
understanding price movements in stocks or crypto
all of it will grow significantly by the end of this series.

Fundamental
Analysis VS
Technical Analysis​

The first thing we have to understand is that the
rewards of trading and investing are great
because it compounds over years and can
change generations. So, don’t think about
changing the 21 days, think about changing the
generation ahead, your next decade ahead,
because it is just a powerful thing that no one
talks about. Trading is like a skill that you need
to acquire and think of the initial capital as an
investment into the skill, or a better analogy is
its business.

So, let’s start with investing, I guess people
know we’re looking over the long term,
right? But what are you looking at? For
example, let’s have a look at the farmland of
onions, in this case, onion is the asset, this is
something that the farmer, who is the
INVESTOR, is investing his time, his energy,
and money, but why is he doing it? So that,
the produce of the next year will be of good
quality, he’ll get the wages, and then earn
back his money. What do the investors do?
He says okay, can I judge the management,
quality of a company, do they have a vision,
can the company grow? And then he might
be, what are the cash flows? Are they able to
bring the cash flow in?

FARMER INVESTOR

Seeds, tractor and Company asset
harvesters Company’s cash flow
Savings of farmers to Company debt
meet expenses obligations
Loans taken by the Company Revenue
farmer Company profit/loss
Farmer’s turnover
Farmer’s Income

FIRSTSTANDS For example, you might think petrol, diesel
their era is shady, the future is electric. I
think electric cars will do well. Now there is
no Tesla in India but they’re actually
battery manufacturers. You might conclude
that the demand of battery manufactures
will increase in the future. So you’ll see,
does the founder understand the battery
industry? Can he distribute it? Are their any
modes? Etc, etc. So that is fundamental
analysis.

There is another analysis
type, technical analysis.
Fundamental is when you’re
analyzing the company, in
technical analysis You are
Looking at something
completely different. Like
what? So in technical
analysis you look at
DEMAND AND SUPPLY, So if
all these banks are buying a
stock and the price goes up,
technical analysis can tell
you that.

FIRSTSTANDS People assume trading means short term, but trading is intent to sell. Let’s
understand this, before you buy something, you say, I am buying this today, I will
sell it in 2 months, or next 1 year. Like you say I believe in batteries, will that
happen in 3 years or 3.2 years? No one knows, right! so there is an intent to sell but
it is a long time. Here is something really interesting about technical analysis: all
these people who perform fundamental analysis, the smarter ones, like FIIs, and
the banks and guys having millions of dollars. How do you think they’ll deploy a
billion dollars into a bunch of companies? They do their fundamental analysis and
say xyz company is doing good. So, do you think they place their 100 million dollars
in one shot? No, obviously no. So, do you think they’ll stagger their investment over
say, three years and keep checking every quarter to see their result? What do you
think the price would look like over a long period of time? The price will keep high
consistently, due to its consistent demand. So essentially technical analysis is
gauging demand or supply.

Fundamental analysis Technical analysis

Analysis company’s Analysis company’s
financials stock price
Predominantly used for Predominantly used for
long term investments. short term trading
Finding an undervalued Finding repetitive
stock to invest for long patterns to create
term trading opportunity
Requires business Does not require
domain knowledge business knowledge

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