Lets understand the time frame based on financial cycles. Banks, Companies, Partnership firms, Financial Institutions, etc follow Yearly cycle to report their company performances. This annual cycle is further divided into 4 quarters and we get unaudited financial reports.
Based on the above time-cycles we can come to conclusion that quarterly and annually we can assess the performance of the companies.
Most of the companies year ends on 31-Mar, which is a 365 day tenure. During this 365 day period, variety of News flows in the Market in relation to the company.
News can be...
1. Company Corporate actions
2. Policy Changes by the Govt.
3. Demand/Supply issues in the Market
4. Geo-Political issues
5. and rumors floating around
For every information that comes out in the main stream Media, Social Media, has a reaction on the stock price. We can view that reaction on the chart of the stock. The best way to view this is on a Candle Stick chart.
To assess what's happening with the price, it is advisable to follow Simple Moving Average of the price. Now comes the question, what is the best Moving Average period to follow.
This is the simple Math to follow...
1 year : 365 days
Working Days : 52*5 = 260
So, we can expect 260 candles on the chart, but then, we need to include holidays too.. which in general are 10 days.
Including the holidays, the number of candles that we can see on a yearly basis is going to be around 250