Learn the key financial and technical indicators behind AI trading decisions
Start with basic concepts every investor should know
Dive deeper into technical and fundamental analysis
Master complex indicators and risk metrics
A momentum oscillator that measures the speed and magnitude of price changes, ranging from 0 to 100.
RSI is like checking if a stock is "overheated" or "too cold." It tells you if too many people are buying (overheated) or selling (oversold).
Above 70: Stock may be overbought, potential sell signal
Below 30: Stock may be oversold, potential buy opportunity
The ratio of a company's share price to its earnings per share, indicating how much investors are willing to pay per dollar of earnings.
P/E ratio is like asking "How many years of current profits would it take to pay back what I paid for this stock?" It shows if a stock is expensive or cheap.
High P/E: Stock may be overvalued or growth expectations are high
Low P/E: Stock may be undervalued or company has problems
A trend-following momentum indicator that shows the relationship between two moving averages of a stock's price.
MACD is like watching two cars on a race track. When the faster car (short average) overtakes the slower car (long average), it signals a trend change.
Positive MACD: Upward momentum, potential bullish signal
Negative MACD: Downward momentum, potential bearish signal
A volatility indicator consisting of a moving average and two standard deviation bands above and below it.
Bollinger Bands are like a highway with guardrails. When the price hits the upper rail, it might bounce down. When it hits the lower rail, it might bounce up.
Price near upper band: May be overbought, watch for reversal
Price near lower band: May be oversold, potential bounce opportunity
A financial ratio indicating the relative proportion of shareholders' equity and debt used to finance a company's assets.
This ratio is like checking how much of your house you own versus how much you owe the bank. Lower is usually better for stability.
High D/E: More risky, company relies heavily on borrowed money
Low D/E: More stable, company has less debt burden
A stock indicator that smooths price data by creating a constantly updated average price over a specific time period.
Moving average is like finding the "typical" price over recent days. It helps you see the main direction without getting confused by daily ups and downs.
Price above MA: Generally bullish trend, upward momentum
Price below MA: Generally bearish trend, downward pressure
A volatility indicator that measures the degree of price volatility by decomposing the entire range of an asset price.
ATR measures how "jumpy" a stock is. High ATR means the stock moves a lot each day. Low ATR means it's more stable and predictable.
High ATR: More volatile, bigger price swings, higher risk/reward
Low ATR: Less volatile, smaller price movements, more stable
The cash generated by a company's operations minus capital expenditures needed to maintain its asset base.
Free cash flow is like your take-home pay after all bills. It's the real money a company has left to grow, pay dividends, or buy back shares.
Strong FCF: Company generates good cash, can invest in growth
Weak FCF: May struggle to fund growth or pay shareholders
See how these concepts were used in actual trading reports and their real-world outcomes.
In the Fortinet (FTNT) report, RSI = 25.5 suggested the stock was oversold and due for a potential rebound.
Stock gained +12% in the following 2 weeks
FTNT's P/E of 24.5 vs sector average of 22.1 indicated premium valuation, justified by strong growth prospects.
Premium held as company beat earnings expectations
MACD positive crossover at 2.15 confirmed upward momentum building in the stock price.
Trend continuation confirmed with sustained upward movement