5 Technical Indicators Every Trader Should Know

Focus: STOCKS

Most charting software includes dozens of different indicators that can be displayed on the charts, but Michael Fowlkes of Market Intelligence Center outlines the most important ones to know.

In order to become a successful investor, we need to be able to develop two distinct sets of skills. They are commonly known as fundamental and technical analysis. They are very different skill sets, yet they are equally as important to learn if you truly want to understand what is going on with your stocks.

Fundamental analysis is essentially digging into a company's financials. Fundamental analysts study everything that could potentially affect a company's value. This can include both macro and micro economic factors as well as things like the company's strategic planning, supply chain and even employee relations. Technical analysts study stock charts, operating under the premise that trends tend to occur over and over again.

For someone starting to learn technical analysis, it can be a daunting experience. There are so many terms and phrases that it can get a bit overwhelming. We are going to look at a few easy-to-learn concepts that you can use as a starting point along your journey into technical analysis.

For our discussion, all of our charts were obtained from stockcharts.com. You can visit this site to re-create any of the charts, and use the following tools to evaluate your personal holdings as you learn how to incorporate technical trading in your investing arsenal.

1. The Accumulation/ Distribution Line
What the accumulation/distribution line (A/D line) seeks to determine is whether money is either flowing into out of a security.