Technical Analysis
A method of evaluating securities by analyzing price charts, patterns, and statistical indicators.
Definition
Technical analysis is a trading discipline that evaluates investments and identifies trading opportunities by analyzing statistical trends gathered from trading activity, such as price movement and volume. Unlike fundamental analysis, which examines financial statements and economic factors, technical analysis focuses on patterns of price movements, trading signals, and charting tools. Core principles include: price discounts everything, prices move in trends, and history tends to repeat itself. Common tools include moving averages, RSI (Relative Strength Index), MACD, Bollinger Bands, Fibonacci retracements, and candlestick patterns. Technical analysis is widely used in forex, stocks, and crypto trading.
Related Tools
Related Terms
Fibonacci Retracement
A technical analysis tool using horizontal lines at key Fibonacci levels to identify support and resistance.
TradingMoving Average
A technical indicator that smooths price data by creating a constantly updated average price over a specific period.
TradingSupport and Resistance
Price levels where buying or selling pressure is strong enough to prevent further price movement.
TradingVolatility
A statistical measure of the dispersion of returns for a given security or market index.