Stock Price

What Affects a Stock Price?
Stock market prices are affected by company and world events, market sentiment and psychology, business fundamentals and much more. In today’s article we will discuss some factors that affect the stock price.

Earnings results
Investors and traders asses a company based on its earnings per share, its revenue and its future earnings potential. Companies that are publicly traded must report their earnings results quarterly.

New Product
The introduction of a new product is often seen as a revenue enhancer for a company. Additionally, an existing product that breaks into new markets is seen as a revenue enhancer as well. This will ultimately improve the stock price of a company.

Performance of an Industry
The overall performance of a sector or industry that a company is in will determine the price of stock as well. Most of the time, the prices of companies in the same industry will move together concurrently. This is due to the fact that market conditions will typically affect the companies in the same industry the same ways.

Market Changes
The stock market rises and falls and these market swings will affect the way you invest your money. There is nothing certain about the stock market so you must find a proven system such as Japanese Candlesticks to assist you with determining the direction of the market.

Merger or Take-Over
A company that is taken over is expected to have their stock price increase and the company that takes over is expected to have a drop in its share price. This theory assumes that the company was bought over a higher price that it’s last traded price of stock.

Stock Splits
Typically after a stock split, the price of stock increases even if in theory it shouldn’t affect the price. Some believe that the stock is more affordable after the stock split but some believe that there is no real impact on the price.

New Contracts or Government Orders
When major contracts or government orders are obtained by companies it typically means a bull run in it price of stock. The companies that are unable to successfully bid on major order or contracts will tend to see a sell-off in its stocks.

Japanese Candlesticks are the fastest way for new investors to quickly and accurately predict price movement in stocks. Once you are comfortable with the major candlestick signals, expand your expertise by learning the various Candlestick Patterns. Combine these with your favorite Technical Analysis indicators such as the moving average, and you have the perfect trading arsenal for evaluating stocks, currencies, commodities, or Exchange Traded Funds.