Why Stock Prices Rise and Fall

Stock prices move mainly because of supply and demand. When more investors want to buy a stock than sell it, its price tends to rise. When selling pressure increases, the price can fall. Company earnings, customer satisfaction, analysts’ forecasts and the outlook for an industry can all affect investor demand. Fundamental and technical analysis are common methods investors use to understand these movements. Prices can also be distorted by manipulation, including pump-and-dump schemes. Investors should research carefully and avoid making decisions based on hype alone.

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