For better understanding through video tutorial click here.
Technical Analysis is
•
The
method of Forecasting the direction of prices.
•
By
studying the past market data.
•
Market
data comprise of Price and Volume.
•
With
the help of charts showing the trading history and statistics.
•
To
make buy or sell decisions.
Definition of Technical Analysis
•
Technical analysis is a method of evaluating securities by analyzing statistics generated
by market activity, past prices, and volume.
•
Technical analysis is a security analysis methodology for forecasting the
direction of prices through the study of past market data, primarily
price and volume.
•
Technical analysis is a methodology that makes buy and sell decisions
using market statistics. It primarily involves studying charts
showing the trading history and statistics for whatever security is being
analyzed.
Fundamental Analysis
•
A
method of evaluating a security that entails attempting to measure
its intrinsic value by examining related economic, financial and
other qualitative and quantitative factors including macroeconomic factors
and company-specific factors
•
The
end goal of performing fundamental analysis is to produce a value that an
investor can compare with the security's current price, with the aim of
figuring out what sort of position to take with that security (under-priced =
buy, overpriced = sell or short).
Difference between the two
Assumptions of TA
1.
The market discounts everything.
2. Price
moves in trends.
3. History tends to repeat itself.
The Importance Of Volume
•
What
is Volume?
Volume is simply the number of shares or
contracts that trade over a given period of time, usually a day. The higher the
volume, the more active the security.
•
Any price movement up or down with relatively
high volume is seen as a stronger, more relevant move than a similar move with
weak volume.
In the other blogs we will study the Concepts related to TA
•
Trend
Analysis
•
Support
and Resistance
•
Charts
and their types
•
Chart
patterns
•
Technical
Indicators and so on…
