Crystal Ball for Investors?

Identifying divergences between stock prices and technical indicators provides opportunities to foretell price movement.

El Paso, TX (PRWEB) February 18, 2004 ---When it comes to analyzing, selecting and monitoring investments, the general public often feels inept. Overwhelmed with advertisements advocating strategies of one sort or another, investors want help with specific advice. More often this specific advice is based upon past history which may prove to be a disaster for future performance.

To help investors focus more on future probability rather than historical analysis, John Thomas, owner of Market Tutor who trains investors over the telephone, uses a technique called divergence analysis." John relies upon various websites to help create what he calls the closest thing to a crystal ball that investors will ever find."

After retrieving a price history chart on a particular stock, John also pulls up two technical indicators called MACD and RSI. These two terms, while daunting at first glance, are better understood by applying them without going into all the technical details of what they consist of. A divergence occurs when the trend for either the MACD or RSI runs opposite of the stocks price and will often result in a change in direction for the stock price. The key is to decipher whether this change in stock price direction is a wiggle or the beginning of a trend reversal.

For example, if a particular stocks price hits a series of highs yet the charts on the MACD and RSI remain flat or decline, a divergence occurs and the stock price will more likely pull back. The converse is true when a stocks price is making a series of lows. The probability of a stocks price reacting to a divergence is quite high. But it takes patience to sift through potential divergences and an alert eye to identify and recognize these patterns.

John is a certified public accountant by profession with over twenty-five years experience analyzing stocks and has actual market participation as well. John states that, training anyone in divergence analysis is both an art and a science. However, a person does not necessarily have to know all there is to know about a particular stock. For John and his students, divergence analysis is the best indicator to foretell future price performance.

For more information, you may contact John at either his website: www.marketturor.com or 1-877-657-6572.
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