Newbie: assessing whether a stock is under/overvalued

[gurunaif]

:?:
Hi,
Forgetting Technical Analysis (for now). Could anyone point me to a good reference as to how one can assess whether a stock is under/over valued? I guess what i am looking to learn is how one can establish the low / high end of a stocks price.

Any pointers appreciated,

Nathan

 

[Trader333]

Is this on an intra-day or end of day basis ?


Paul

 

[gurunaif]

Is this on an intra-day or end of day basis ?


Paul

End of day. I'm looking to hold for a few days to a few weeks ideally.

 

[JTrader]

Hi gurunaif

you would be able to do some research into the different broker/financial institutions/marketmakers price targets for a particular stock and assess how the current price relates to the target price.

Not sure whether this type of research/information would be of any help though (?)

 

[timothy_f_clarke]

Hi gurunaif,

I've just started looking into day trading recently, so I'm not sure how much my input is worth here. However, I'd recommend you be very careful about mixing fundamental analysis in with day trading. The two best pieces of advice (as opposed to techniques) I seem to read over and over is that emotion should not be allowed to decide a trade, and that on a short term trade you are dealing with people not company value. For example, resistance lines are created because people wish to get rid of stock they bought before they dropped in value so as not to lose any money from what has been perceived as a bad trade. They're not interested in what the actual value is and so neither should you be. The cost of stock depends on how much buying and selling is happening.

I hope that makes sense. As I say this is only what I've read and it does apply to short-term buy-sell trades. I'd be interested to know what any of the senior members have to say because I intend to move down the solely technical analysis route myself.

Tim