How to Use Interactive Stock Graphs: An Introduction

by Prof. Richard Einer Peterson
College of Business Administration
University of Hawaii
October 22, 1977
Updated February 9, 1999
email: rpeterso@hawaii.edu

The following example is based on the Interactive Stock Graphing capability of bigcharts.com

Six graphs will be presented; all show the stock's daily closing price, a large chart size was chosen, and the stock involved is General Motors (ticker symbol of GM). Graphs 1-3 have a 2-year time frame and a "Lower Indicator" of the P/E (Price/Earnings) Ratio. The graph of GM stock price is compared to the stock price of Ford (ticker symbol of F) in graph #1, to the DJIA (Dow Jones Industrial Average) in graph #2, and to the 30-day SMA (Simple Moving Average) in graph #3.

Graphs 4-6 have a 3-month time frame and a "Lower Indicator" of the Up/Down Ratio . Graph #4 compares GM to Ford, graph #5 compares GM to the DJIA, and graph #6 compares GM to the 9-day SMA.

Links to the six graphs are given below

Graph # 1
Graph # 2
Graph # 3
Graph # 4
Graph # 5
Graph # 6

DETAILED INSTRUCTIONS

Go to http://www.bigcharts.com
In the "Enter Symbol or Keywords" box, type GM and then click on the "interactive chart" box. The righ-hand frame shows a one-year chart of GM. The left-hand frame has the following clickables:

COMPLETE SET OF AVAILABLE CHOICES

1. If click time frame, then Time:

2. If click time frame, then Frequency 3. If click compare to, then Index 4. If click compare to, then Symbol 5. If click indicators, then Moving Average 6. If click indicators, then Upper Indicators 7. If click indicators, then Lower Indicators

LINKS TO DEFINITIONS OF TERMS USED

Time
time frame: Time
Frequency
time frame: Frequency
Index
compare to: Index
Symbol(s)
compare to: Symbol(s)
Moving Averages
indicators: Moving Averages
The traditional interpretation of moving averages focuses on price movement relative to the average itself. Investors are typically bullish when the price moves above its moving average and bearish when the price falls below its moving average.

Moving Averages are also very useful in smoothing noisy data. Applying a 200-day moving average, for example, will give you a clear view of a security's long-term historical trend.
Upper Indicators
indicators: Upper Indicators
The A/D Line is the most widely used indicator measuring market breadth. It represents a cumulative total of the number of stocks advancing vs. the number of stocks declining. When the A/D Line rises it means that more stocks are rising than declining (and vice versa).
Lower Indicators
indicators: Lower Indicators
The Upside/Downside Ratio shows the relationship between the volume of advancing issues and the volume of declining issues. Upside volume is simply the sum of all volume associated with stocks that closed up in price while downside volume is the sum of all volume associated with stocks that closed down in price.

The Breadth Advance/Decline Indicator is the number of advancing issues divided by the total number of both advancing and declining issues. Readings above 0.5 are considered "Bullish" while readings below 0.5 are considered "Bearish."

The Noncumulative (Daily) A/D Line is calculated by subtracting the number of declining issues from the number of advancing issues and then dividing that figure the total number of issues traded. (Advancing Issues - Declining Issues) / (Total Number of Issues Traded) Generally, values above 0.25 are considered "Bullish" while values below -0.25 are considered "Bearish."
Price Display
chart style: Price Display
Chart Background
chart style: Chart Background
Chart Size
chart style: Chart Size

LINK TO COMPANY INFORMATION, STOCK CHARTS, AND EDGAR FILINGS

LINK TO STOCK MARKET INDICATORS

STOCK MARKET INDICATORS: DEFINITIONS

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