Explanation: Resistance and Support

Have you ever watched a stock price chart, and it seemed like it was stuck near a certain price?

Of course, it really isn't, but when you watch the prices, it feels that way.

Pure fundamental investors HATE any discussion that involves buying and selling stock based on the price patterns. It's illogical, and they're right--to a point.

True technical traders, on the other hand, vehemently insist that the markets are ruled entirely by the price charts. Most of them say that history repeats itself. Of course, even some of the best technical traders admit that's not always true.

Fundamental investors believe that a stock's price SHOULD be based upon the company's fundamental finances and industry position. They're probably right. Prices SHOULD reflect these.

However,

When to Sell Stocks

A lot of people complain that people will tell you when to BUY stocks, but they never tell you when to SELL those same stocks.

Of course, nobody knows exactly when to sell, but here are a few guidelines that I use: