Course Content
Introduction
The stock market is a marketplace where shares of publicly listed companies are bought and sold. It plays a central role in the modern economy, acting as a bridge between businesses that need capital and investors who have money to invest. The origins of the stock market trace back to the early 1600s, when the Dutch East India Company issued the first shares on the Amsterdam Stock Exchange. This allowed the company to raise money from the public to fund its trade ventures, in return for a share of the profits. Over time, this concept evolved, and today, stock markets exist all over the world, with major exchanges like the New York Stock Exchange (NYSE), NASDAQ, and London Stock Exchange facilitating trillions of dollars in trade. At its core, the stock market enables businesses to grow. By offering shares to the public through a process called an Initial Public Offering (IPO), companies can raise large amounts of money to expand operations, invest in research, or develop new products—without having to rely solely on banks or private lenders. In return, investors get the opportunity to share in the company’s success through rising share prices and dividends. Investing in the stock market can be a powerful way to build wealth over time. Wise investments in strong companies can generate solid returns, especially when held for the long term. Many individuals have grown their savings substantially by investing in companies that have thrived. However, it’s important to remember that the stock market carries risks. Prices can go up, but they can also go down—sometimes sharply. Economic downturns, company mismanagement, or shifts in the global market can all lead to losses. For beginners, it's essential to approach investing with caution, avoid chasing “get rich quick” schemes, and take the time to understand what you're investing in. In short, the stock market is a powerful tool for economic growth and personal financial development—but like all tools, it must be used wisely.
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Introduction
Stock Markets Around The World
Listing On A Stock Market
How Stocks are Bought and Sold
Trade Date vs Settlement Date, What is T + 2?
What Is A Stock Market Index?
ETF’s and Index Funds
Fundamental Analysis
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Fundamental Analysis Introduction
Understanding Revenue and Profit
Earnings Per Share and PE Ratio
Understanding the Balance Sheet
Understanding Cashflow
Dividends – How Investors Earn Income From Their Shares
What Causes Stock Prices To Rise And Fall
Understanding Market Capitalization
Technical Analysis
Along with Fundamental Analysis, Investors increasingly rely on Technical Analysis to decide whether to buy or sell a stock. Here we will explore the main techniques.
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Introduction to Technical Analysis
How To Read A Price Chart – The Basics
Understanding Support and Resistance Levels
Identifying Trends and Drawing Trendlines
Understanding Moving Averages
Introduction to Momentum Indicators
Chart Patterns – Spotting Setups in the Market
Volume – The Power Behind a Price Movement
Investing Safely and Profitably
How do professionals invest safely and profitably? Some key concepts such as position sizing and stop losses.
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How To Place Trades And Manage Risk
Using A Trailing Stop To Protect Profits and Limit Loss
Diversification and Portfolio Management
Taking Profits
Common Investor Mistakes And How To Avoid Them
A Quick Word On Taxes
Summary and Beginner’s Checklist
10 Must Read Books for Investors and Traders
Beginners guide to investing in the Stock Market

Understanding Moving Averages

 

A moving average (MA) is a tool that helps smooth out price data over time, making it easier to spot the direction of a trend.

 

Instead of focusing on short-term price fluctuations (noise), a moving average shows the overall path the price is following — which helps investors decide when to buy, sell, or stay on the sidelines.

 

 

Why Use Moving Averages?

 

  • To identify trends early

  • To filter out noise from price charts

  • To act as dynamic support or resistance

  • To generate buy/sell signals when combined with other indicators

 

 

Two Main Types of Moving Averages

 

1. Simple Moving Average (SMA)

This is the average of the closing prices over a set number of periods.

Example: A 10-day SMA adds up the last 10 closing prices and divides by 10.

 

2. Exponential Moving Average (EMA)

Gives more weight to recent prices, so it reacts more quickly to price changes.

Example: A 10-day EMA responds faster than a 10-day SMA, which can be helpful in fast-moving markets.

 

 

Common Moving Average Timeframes

 

Timeframe Use Case
50-day Identifies medium-term trends
200-day Tracks long-term trends (very popular)
20-day Short-term trend, often used by active traders
9 or 12-day EMA Used in momentum indicators like MACD

 

Interpreting Moving Averages

 

When Price Is Above the Moving Average:

  • Indicates a potential uptrend

  • The MA can act as support

 

When Price Is Below the Moving Average:

  • Indicates a potential downtrend

  • The MA may act as resistance

 

 

Moving Average Crossovers

 

One of the most popular strategies is using two moving averages (short-term and long-term) together:

 

🔹 Golden Cross:

  • The short-term MA crosses above the long-term MA

  • Signals a potential upward trend

 

🔸 Death Cross:

  • The short-term MA crosses below the long-term MA

  • Signals a potential downward trend

 

Example: A 50-day SMA crossing above a 200-day SMA = Golden Cross

 

 

Tips for Using Moving Averages

 

  • Combine with trendlines, support/resistance, and volume for more accurate signals

  • Use longer MAs for big-picture trends, and shorter MAs for active trading

  • They work best in trending markets, and less effectively in sideways or choppy markets

 

 

Summary

 

  • A Moving Average smooths out price data to show the trend more clearly.

  • The SMA treats all prices equally; the EMA gives more weight to recent prices.

  • Moving averages help identify trend direction, act as support/resistance, and are used to spot entry/exit signals (especially via crossovers).

They’re easy to use and powerful — and they work even better when combined with other tools like RSI, MACD, and chart patterns.

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Stock Market Course