What are Stock Signals?
Stock signals are indicators of potentially profitable trading opportunities. Investors get information about which type of order to place on their trades based on in-depth technical fundamental analysis. By using the stock signals, investors can avoid the tenuous task of doing hours and hours of technical analysis which is required to understand the market.
Benefits of Using Stock Signals
Stock Signals have huge benefits for investors. Not only it saves investors from huge losses, but it also guides the investors towards investment opportunities that they might not have picked themselves. Moreover, in the case of novice traders, trade signals are an excellent guide to enter the stock market.
The key benefits of using Signal Providers are:
- More profitable opportunities – Using trade signals bring more opportunities to the table, some of which an investor might not even know. This gives investors the option to choose the best tradable opportunities that better suit his/her trading goals.
- Having control over your money – Investors can control their money themselves, which is a better option than other investment options.
- Less stress – With a trusted signal provided, the risks are reduced and chances of profit are higher. This gives the investor the confidence to carry out the trading stress-free.
- Saves time and money – Following the trade, signals save time, money, and resources that are spent in doing all the research and analysis. Not only time and money spent in the analysis is saved. But the money which is at risk of losses is also saved.
- Better Profits – Trade signals are backed by hard-core analysis and research. Hence chances of profits are higher
- A higher number of trades – Signal providers regularly give out trade signals. Investors can take advantage of all the signals and carry out the maximum number of trades which are possible
Disadvantages of Using Stock Signals
Despite the huge benefits of using stock signals, there always are shortcomings of such services.
- An investor who is at the receiving end of the signal does not know the people who have compiled and sent this signal. Therefore, the risk of receiving scam signals is always there. The only way around to prove whether the signal provider is authentic and gives accurate signals is by recording the transactions and outcomes of them
- Stock signals come at a cost. Free signals are available in the market. Even though they might seem attractive, the majority of free signals do not offer much value.
- Another downside is that investors who follow stock signals will never be able to understand how the stock market operates and what drives stock prices up and down. Learning is compromised when using stock signals. Hence it’s important you choose a stock forecast and signal provider who lets you in on market updates and helps you learn your way through. A good example of this is Elliott Wave Forecast who not only provide timely and reliable signals but also explain how and why is marketing behaving in every step of the way through their live analysis sessions.
Breakdown Of A Stock Signal
A stock signal usually looks like this:
Stock: e.g Disney
Long or Short: Long
Limit Price: $205.00
The first thing a stock signal will tell you is the name of tradable security, like the one mentioned above. The signal provider offers the name, Disney, after seeing some trading opportunities backed by detailed research.
Next, the signal will indicate the trading suggestion, which is long or short. If there are chances of the stock price rising, the signal will indicate a long position. Similarly, if the stock is expected to fall, the signal will indicate a short position.
After that, the signal indicates the limit order price on the suggested position. This is the price at which the investor should execute his trade.
Then, the signal also includes an exit strategy, in case the market does not move in the expected pattern. Hence a risk-averse strategy is always included in a signal. The ultimate goal is to outperform the market. Therefore, a stop loss stops the losses. In the above-mentioned signal, if the Disney stock falls to $203, the broker will close the trade for you.
Lastly, the signal also includes a take-profit price, at which the investor will lock his gain. In the above-mentioned signal, it’s at $214 which is 4% over the limit order price. This means that as an investor you will earn a 4% profit through your trade if you follow the signal and the market move as expected. Get to know the list of crypto mining companies that are leading the industry.
What To Look For In A Stock Signal Provider?
A variety of signal providers are operating in the market. Some of them are better than others. One thing worth mentioning is that signal providers are not only differentiated in terms of quality but also terms of focus. Few signal providers focus on day trading and some focus on long-term investment.
The foremost characteristic of a trading signal provider is a strong track record of beating the market. No signal provider is 100% accurate but a higher accuracy rate increases the reliability of the signal provider. Moreover, a longer period of accurate track record increases investor confidence in the signal provider.
Transparency is another key trait that is very important. A signal provider which records trade wins and never closes losing trades is misleading its audience, which is unethical. For this, it is advisable to avail opportunities of free trial and money-back guarantee which are offered. This way investors can get to know the credibility of the service before committing money.
Lastly, always pick a service that matches your investment goals. Study the strategy and data analysis techniques, first, to understand the methodology of the signal provider. Make sure it matches your investment goals and outcomes to avoid future disappointment.
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Top Stock Indicators in 2022
Trading indicators are used by every trader to predict the future. These are mathematical calculations that are portrayed in the form of lines on a chart. These charts help traders identify trends within the market.
There are two types of indicators
- Leading Indicators: Leading indicators help traders identify where the price is leading. Leading indicators provide better profits at the risk of increased risk. These indicators work by identifying how overbought or oversold a stock is.
- Lagging (or trend-following) indicators: Lagging Indicators work best for price movements in relatively long trends. These indicators help you decide in a mature trend when the risk is minimum.
Below is the list of top stock indicators which are used by the majority of traders:
- Relative Strength Index (RSI) – RSI is a momentum oscillator that measures the speed and change of price movements. The reading of this indicator ranges from 0 to 100. This indicator helps identify overbought and oversold stocks. A stock with an RSI of 70 and above is an overbought stock and a stock with an RSI of 30 and below is oversold.
- Stochastic – The stochastic indicator is used to forecast trend reversals in the market. It is used by experienced traders and can be used for multiple financial instruments like stocks, currencies, and other investment assets.
- Simple Moving Average – Simple Moving Average is one of the core indicators used in technical analysis and one of the easiest to use and predict. It is the average price of a stock over a specified period. The main use of SMA is to identify the direction in which the stock price is expected to move based on the previous history.
- Moving Average Convergence (MACD) – Moving Average Convergence is used to identify moving averages that indicate the development of a new trend, either bullish or bearish. This is a very important indicator for traders as timely recognition of a change in trend is a very crucial period in the stock market.
- Bollinger Bands – Bollinger Bands is one of the most popular technical analysis tools which shows the levels of highs and lows a stock has reached within a specific period. It comprises three lines: One line is the stock price lines, the second is below the price line and the third is above the price line. This indicator also indicates the relative strength of security where high strength is near the upper line and low strength is near the lower line.
- Exponential Moving Average – Exponential Moving Average (EMA) measures the trend direction over a specific period. EMA is more accurate since it applies more weight to the recent prices instead of using average prices.
- Stop and Reverse Parabolic (SAR) – Stop and Reverse Parabolic determines when the trend is expected to end and a price reversal will start. It assists traders to decide when to close their trades.
How do Stock Signals work?
Trade signals are backed by a variety of inputs and lots of research. One stock signal, mentioned above, has been created after synchronizing all the information received about the market and of the company.
Technical analysis is the major contributor to a trade signal. In addition to it, fundamental analysis, quantitative analysis, and economics may also be inputs, as well as sentiment measures and even signals from other trade signal systems. Trade signals give investors well-informed and fully researched information summed up information which is devoid of emotion. Learning technical analysis is a daunting task especially for those who do not know about trading and company analysis. There are multiple paid courses and technical analysis books available which provide in-depth knowledge about Technical Analysis.
Stock signals are usually not only used as buy and sell triggers. They can also be used to change the investor’s investment portfolio by determining when it might be a good time to buy more within a specific industry.
5 Best Stock Signal Providers
|Stock Signal Provider||Cost||Number of signals|
|Elliott Wave Forecast||Starts at $99.99/month||4HR, Daily & Weekly EW Counts|
|Motley Fool||Starts at $199/year||Twice a month|
|Learn 2 Trade||£15/month||Get 3 Stock Signals Per Week|
|Technical Trading Signals||Start at $95/ month||Daily|
|Mindful Traders||Starts at $47/month||6-8 trade signals per week|
Elliott Wave Forecast is one the best technical analysis firm which has an excellent team of analysts on its panel who have an extensive background in the financial market and technical analysis. The company combines its proprietary pivot system, distribution, cycle, and sequence which gives a better and more accurate forecast. They offer 24-hour comprehensive coverage of 78 markets in all asset classes including stocks.
Elliott Wave Forecast gives its subscribers all the resources and information needed to plan entry and exit in the stock market. Their methodology, right-side system, and the blue box approach towards analysis give Elliott Wave Forecast an edge over other signal providers. Elliott Wave Swing Sequence and Count provide a higher degree of confidence and accuracy to the subscribers which helps them decide to make better-informed decisions in their trades.
An example of a GOOGL 4 Hour Elliott Wave Chart is shown below:
Elliott Wave Forecast is very actively providing stock signals to its subscribers. It offers a lot of free resources to its audience along with paid signal services. Elliott Wave Forecast is equipped to provide accurate and timely forecasts of 78 instruments that are trusted by more than 10,000 traders worldwide. Today Elliott Wave Forecast is one of the best signal stock signal providers.
Motley Fool has created quite a reputation for itself in a very short period. They help millions of people attain financial freedom through the services offered from their website, podcasts, books, newspaper column, radio shows, and premium investing services. They offer
- Premium membership services that provide stock recommendations, detailed analysis of companies, model portfolios, live streaming video during market hours, and more
- Free market news and commentary with hundreds of new articles published each week
- Member-only tools and programming for building your ideal portfolio, tracking your performance, and monitoring companies of interest
From a starting price of $199/year to $13,999/year, The Motley Fool offers a range of services catering to all types of audiences. The Motley Fool is very popular amongst traders because of the market-beating returns offered through their stock signals. The below table shows the returns as of 18/09/2021:
With over 70,000 subscribers The Motley Fool’s six-step investment philosophy has been very successful. The six steps of investment are:
- Buy 25+ companies
- Hold Stocks for 5+ years
- Add new savings regularly
- Hold through market volatility
- Let winners run
- Target long term growth
The Motley Fool mainly looks for companies in emerging industries with a sustainable advantage over competitors, among other factors. Their approach towards investment has made them one of the renowned names amongst investors. The Motley Fool, undoubtedly, is one of the best Stock Signal providers in 2022. Before you begin your journey as a trader, it becomes crucial to learn how to trade as well as how to strategically choose stocks that can make money.
Learn 2 Trade
Learn 2 Trade helps traders make consistent profits and reach their maximum potential. Their stock trading signals enable investors to trade with a risk-averse and informed approach.
Once traders become a part of Learn 2 Trade, they start receiving 3 signals per week. Each signal contains crucial information in terms of profitable order suggestions which has been attained after an in-depth analysis of the stock markets.
At just £15 Per Month With a 30-Day Moneyback Guarantee
- Get 3 Stock Signals Per Week
- All Signals Contain Entry and Exit Orders
- Benefit From Our In-House Stock Market Experts
An example of an analysis of Trade Ford Motors done by the team of Learn 2 trade is below:
Learn 2 Trade offers one of the best services of stock signals. Their services are
- Reliable and Secure:
- Cloud-based messages are sent in real-time to all users
- Free Service: The Telegram service is entirely free
- Informative Images: Stock signals are backed with hard evidence
Learn 2 Trade offers stock signals to its audience at a very affordable price. It is one of the best signal providers for novice traders. Their website offers a lot of free introductory material for beginners to start trading and along with complete guidelines on how to start trading through the telegram app of Learn 2 Trade. Learn 2 Trade is amongst the best stock signal provider for 2022.
Technical Trading Signals
Technical Trading Signals has decades of experience in carrying out complex technical analyses in financial markets. Their performance is outstanding, and they are independently verified and tracked. Technical Trading Signals provide the following information for every signal we give to our customers:
- Entry Point
- Stop Loss
- Take Profit
- Detailed Charts
Our highly experienced traders are monitoring and analyzing charts round the clock to identify trading opportunities across different markets: Forex, Indices, Commodities, and Cryptocurrencies. Their subscription packages start from $95/ month to $450 for 12 months. Technical Trading signals offer:
- Expert analyses that identify multiple tradable opportunities per day.
- Affordable real-time signals for the asset class of your choice.
- Real-time desktop and mobile access via the channel most convenient for you.
Technical Trade Signals send trade signals throughout the day. The team at Technical Trading follows 15 minutes, hourly, 4 hourly, and daily time frames. The 4-hour time frame is for long-term trades, and hourly for medium-term trades, and 15 minutes for short-term trades.
Technical Trading Signals provide signals for a variety of financial instruments. They offer a trial of 14-days which is an excellent offer for traders to understand that whether the approach of the stock signal provider matches their investment goal. Irrespectively, Technical Trade Signal gives out the best stock signals in the market. Checkout investing in stocks vs forex.
Mindful traders is a fairly new stock signal provider in the market run by the sole owner Eric. Mindful Traders focuses on swing trading stocks all of which are based on a statistical analysis done by the owner himself.
Being fairly new in the market, Mindful Traders might not have a long history of excellent track records. But it has the owner’s history of personal investments and its returns which are jaw-droppingly high. Two years in a row the owner earned more than 400% return.
Eric uses a trading edge to find favorable trades. Each trade and strategy are tested before recommending it. Subscribers receive about 6-8 trade picks per week. This can vary, some days there will be more than 6 trade signals, and some days there will be no signal.
The owner has made investment education a key part of the Mindful Trader services. The stock advisor website offers detailed educational video content that is an excellent resource for clients, especially newbies.
At $47/month, Mindful Traders give trade signals backed by 20 years of practical research done by the owner himself. His involvement with his work makes Mindful Traders one of the tops picks for stock signal providers.
Type of Stock Trading Accounts
Traders usually operate from the below two types of accounts:
- Cash Account: It is a type of brokerage account in which the investor has to pay the full amount for securities purchased. Investors cannot borrow funds from the broker to pay for transactions in the account.
- Margin Account: A margin account is a different type of brokerage account, in which the investor can borrow money from its brokerage firm to buy securities. In this case, the securities, which are part of your portfolio will be used as collateral for the loan the investor is taking to buy securities. As with any other loan, the investor will incur interest costs when they buy securities on margin.
Paid Signal Providers vs Free Signal Providers
The battle between paid and free signal providers ultimately falls on the shoulders of the investors. He has to decide which costs he is willing to bear and what price he can pay.
If a trader decided to uses the services of a free signals provider he must trade with caution and extensive due diligence. With paid signals, the risk of an inaccurate signal is higher as the brains behind the signal are uncertain.
On the other hand, paid signals have the reliability of a good track record. Moreover, in the case of paid services, subscribers can always ask the signal provider to justify the money they are paying.
Nevertheless, all trading strategies and signal providers, no matter how profitable and robust, are going to experience drawdown and loss phases. There are no guarantees in the stock market, hence no service can be 100% accurate. There is no guarantee of success but a good trading signal provider will contribute to your financial security.
Also check out: Best Crypto Signal Providers
Finding the Best Signal Provider
Finding the best signal provider is a challenge for all investors. After all, a signal provider which best suits the investment needs and requirements of an investor is the top pick. The above-mentioned top five signal providers are currently at the top of their game and their track record speaks volumes about their services.
The list of providers were researched by Shayan who is an experienced freelance researcher on Financial Markets. All products listed were reviewed based on the aforementioned criteria and solely based on his independent views and opinions.
Disclaimer: None of the information published in this article should be construed as investment advice. Article is based on author’s independent research, we strongly advise our readers to always do their due diligence before investing.
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