Metastock ABC Technical Analysis

As a trader, it is important to look at the technical analysis of the stocks. Metastock is THE system to get, though there are various variations. I bought a system recently and had been testing out some of the functions. It is pretty easy to study the charts. It’s called the ABC system. Whether you buy or sell a stock, or do nothing about it, depends on the signals.

First, you look at the arrows. A green arrow pointing upwards tells you to buy. An orange arrow pointing downwards tells you to sell. However, as it takes time for the arrows to appear, you have to look at other signals.

Second, take a look at the bars. Depending on your preference, you may look at bars or candlesticks. I like candlesticks as they show the picture very quickly. Green means it has done well, and red means the prices had dropped. The length of the candlestick tells you the opening price and the closing price, while the extra lines on top and bottom tells you the highest price and the lowest price within the same day.

Third, take a look at the channels. The two lines refer to the support or resistant levels. When the candlestick breaks out of the channels, it could mean two things. If it breaks out above the channel, it means that it will be on an upward trend. If it breaks out below the channel, it means it will be on a downward trend.

That is how the ABC system works. Remember, to choose a stock to buy or sell, it must fulfil all of them. That’s the simple way. For more advanced levels, there are other ways to decide whether you can sell or buy earlier.

There is no need to learn all the other fancy tools. Of course, if you want to ensure a higher chance of success, there is another line to look at. It is called the Balance Line. It is shown as the blue line in the picture below. If the candlesticks are below the Balance Line, it means there is a downward trend. If the candlesticks are above the Balance Line, it means there is an upward trend.

It will take some practice, so whatever I show on my website is just a guide and not an expert recommendation to buy or sell. You can’t just buy based on what you see, because you need to do daily monitoring of the stocks, which should not take more than 15 minutes. The system that I got will help me scan through all the stocks before finding those that somewhat fulfil the above signals before I use my own judgement. Sometimes there are no stocks to buy or sell, so you just have to continue to monitor them.