This is, perhaps, the most useful and the safest way to find good shares. In simple terms, you must begin with the international economic scene and try to formulate a view on key indicators such as the oil price, the Dollar/ Euro exchange rate, the level of overseas interest rates, the level of world inflation, the gold price and so on. Then move to the South African economy and try to decide how these overseas influences will affect our economy. This obviously implies looking at our key indicators such as the level of domestic interest rates, inflation, the balance of payments, business cycle and so on. Then you must look at the individual industries within the economy and try to identify those that are doing well or are about to do well. Once you have found an industry that you like and then look at the specific shares in that industry. Finally, having chosen a share, you must choose a time to buy it. For example, you might decide that the oil price is about to fall heavily. This will affect the South African economy in a variety of ways. Gold is likely to fall (and hence gold shares), as are shares such as Sasol, Trans Natal Coal and other energy suppliers. The level of domestic inflation will also fall and this should benefit generalised industrial companies such as Barlow Rand and Remgro. A detailed study of such shares might then show that Barlow Rand is heavily oversold and due for an upward correction. Finally you will need to take a view on when exactly will be the best time to buy. At this stage, all this might sound like a tall order, but as you become more familiar with various forms of analysis and how the economy works, you will see that it is a very sound method. Hope this help,i`ve read it a in article