How to Read Stock Charts

Print out a sample stock chart to examine (see 'Additional Resources,' below). Stock charts can be set up on a daily, weekly or long-term format, but they all follow the same basic plan. Start at the top where you will see the stock symbol and date of the chart. Also at the top are the day's high, low, and closing prices and the volume of shares traded.
Look just below the top line of information. You will see an entry that says MA(30), MA (60) or some other number. This is the moving average. It is the average price of the stock over recent past. The number in parentheses tells you how many days the moving average covers. At the very bottom of the chart there should be a bar graph. This gives you the volume of shares traded each day the chart covers.
Examine the main graph between the top and the volume bar graph at the bottom. Each day's trading is usually represented by a short bar or 'candlestick.' The top of the bar indicates the high for that day and the bottom the low. If there is a graph line passing through these bars, it indicates the closing price.
Notice which way the graph of the stock price is pointed. If it is headed toward the upper right corner, the stock is in an upward trend. If it's pointed at the bottom right, it is in a downward trend. Sometimes the graph doesn't seem to be moving one way or the other, and traders call this a period of consolidation.
Understand the function of a stock chart. The point is to spot trends early so you can buy early in an upward trend and sell early in a downward trend. Traders use a number of indicators to do this. For example, look for price supports. A price support is a price below which the stock rarely drops. When it approaches the price support, it's likely to reverse the downward trend and start moving up. A price resistance is the same thing in reverse: a price the stock falls short of. If it gets close, the stock price tends to reverse direction and decline.

How to Report Stock Options Taxes (8 Steps)

Review your brokerage earnings statement for the tax year (and previous tax years if necessary) and group together purchase dates and prices with the appropriate selling dates and prices.
Calculate and determine which options were short-term assets and which were long-term assets. Any option that was held for over a year is considered a long-term capital gain or loss.
Enter into line 1 of the 'Part I' Section of Schedule D the first short-term stock option transaction that was completed for the tax year. Options that are presently held will be reported in a future tax year. The description (column A) of the option must include the company name, the quantity of options traded, the type of option (Call or Put) and the expiration date (i.e. Dec 2009).
Enter into columns (B) and (C) the dates the option was purchased and sold, respectively. Notice that if the transaction was a short sale of the option, the sold date would precede the purchase date.
Enter into column (D) and (E) the sales price and the cost of the options, respectively. Ensure that commissions and exchange fees are included in these prices.
Calculate the gain or loss from the option transaction by subtracting the option cost (column E) from the sales price (column D) and enter the gain or loss into column (F).
Continue entering all the short-term option transactions that were completed during the tax year as described in the previous steps. If necessary, use Schedule D-1 (continuation sheet for Schedule D) to report all the transactions.
Enter into line 8 of the 'Part II' Section of Schedule D the first long-term stock option transaction that was completed for the tax year. Continue entering all the long-term stock option trades, following the previous steps for short-term option trades. If necessary, use Schedule D-1 (continuation sheet for Schedule D) to report all the transactions.