Chart or Graph The History of the Stock

I like to use charts and graphs to show price and volume patterns on the
stocks that I'm considering buying. I like to look at about three (3) years
worth of history on these stocks. This gives me a "seat-of-the-pants" gut
feeling for the price and volume swings that the stock goes through.

There's really nothing scientific about looking at history charts. The past
performance is a very useful tool when it comes to making your mind up
about buying or selling any stock. This is especially true when searching
out low-price stocks that move up and down off a 52 week low price.

Note! If you decide to get into technical analysis (not required) of the
stocks you want to trade, you need to remember one thing. Many times
technical analysis trading systems recognize a trend (momentum, etc) and
issues a buy signal after a stock has already moved off the 52 week low.

If it has already moved up an 1/8th or 1/4 point before you get a buy
signal, then you've missed a very significant amount of profit. You don't
need technical analysis software to figure out when to buy a low-price
cyclical stock that has a history trading up and down. You can do that.

Many of the low-price stocks that get recommended in your newsletters
will not be stocks that cycle up and down. Quite a few will be stocks that
are young companies with brand-new technology and products. The only
problem they have is that they've not yet been discovered or promoted.

Using technical analysis on stocks in this category is much more useful.
I've found that these stocks do not exhibit a long history of repetitive price
swings. You can be assured that a good newsletter advisor that follows
and recommends these type stocks has done quite a bit of research.

The upside profit potential these young undiscovered companies can be
just as explosive as any of the stocks we'll follow that trade up and down
off their 52 week low price. Again, no matter which type stock you buy, or
which trading system you use, always study the fundamentals first.

You could end up buying and selling one low-price cyclical stock over
and over again. You buy at the 52 week low, sell at or near the 52 week
high, and wait for it fall back again, and then start all over. At some point
in time, one of these same stocks can and will, take off to new highs.