Technical analysis, or the analysis of stock charts and formations relating to how stocks trade over time, is both a science and an art form, with many experts heeding market movements and gauging entry and exit points into equities positions based on stock price movements over periods of time.
For traders and those needing to maximize returns over relatively short amounts of time, such analysis can be helpful and could provide insight into attempting to time a purchase or a sale of a security. That said, just as with everything in life, playing the odds doesn’t mean a trade will be successful, and while historical patterns do exist, the ability of Mr. Market to turn sour at any point in time remains very, very real.
Recently publicized technical analysis on Apple Inc. (NASDAQ:AAPL) has suggested that Apple’s stock price may take a dip in the weeks and months to come following its most recent iPhone release; this analysis is based on historical data, and specifically, how Apple’s stock price performed in the near-term following a high-profile iPhone launch.
For short-term investors looking to buy and sell within a few months, heeding such advice may be worthwhile. For long-term investors willing to buy and hold stocks for a decade or more, however, pushing this technical analysis aside in favor of building a long-term position in one of the world’s best companies may be the better course of action.
Invest wisely, my friends.
