Technical Analysis

Technical analysis is a method of evaluating securities by analyzing statistics generated by market activity, such as past prices and volume. Technical analysts believe that market trends, as shown by charts and other technical indicators, tend to repeat themselves, because market participants tend to act in a similar manner in response to similar market stimuli. Technical analysts use charts and other tools to identify patterns and make trading decisions. The basic idea is that by looking at past market data, one can identify trends and make informed predictions about a security's future price movements.

Some common technical analysis tools used by traders include:

• Candlestick charts: used to display price movements over a specified time period.
• Moving Averages: a trend-following indicator that calculates the average price over a specified number of periods.
• Bollinger Bands: a volatility indicator that plots two standard deviation lines above and below a moving average.
• Relative Strength Index (RSI): an oscillator that measures the strength of a security's price action.
• MACD (Moving Average Convergence Divergence): a trend-following momentum indicator.
• Fibonacci Retracements: a tool used to identify potential levels of support and resistance in an asset's price movement.
• Trend lines: a straight line that connects two or more price points and is used to identify a current trend in the market.