Technical Analysis

Forex trading is a popular financial derivative that allows investors to speculate on the price movement of currency pairs without owning the underlying asset. One of the most essential tools for making educated predictions in this market is technical analysis. Here’s a comprehensive overview below:

What is Technical Analysis?


Technical analysis is a method used to evaluate and predict the future price movements of financial instruments, such as stocks, commodities, and currencies, based on historical price and volume data. It operates on the fundamental principle that price patterns and trends tend to repeat themselves over time due to collective market psychology.

Let’s delve deeper into its core concepts and foundations:

BASIC PRINCIPLES


Price Discounts Everything:
All information, whether public or private, is already reflected in the price.

• Price Moves in Trends:
Prices tend to move in trends (upward, downward, or sideways).

• History Tends to Repeat Itself:
Since market psychology remains relatively constant over time, price patterns often recur.