What is technical analysis ?
Technical analysis
is deep study of Chart & Volume data. By studying of chart which represent the history of Price &
Volume for a particular script trader makes decision of buying & selling.
Technical
analysis is based on the belief that past market trends can
predict the future behaviour for the market as a whole and for individual stock.
History will repeat itself ,
This is also one of the believes of
technical analysis as chart represent how the script has reacted in past upon
certain volume & result which determined how it will react in future.
Technical analysis also
helps you to decided entry and exit point, Entry & exit point is very
crucial for all regardless he or she is investor or trader,
Below are the few most popular technical chart method to study and apply while doing trading
1 Candlestick chart
2 Line Chart
3 OHLC Chart
4 Point and figure Chart
Price-based indicators
These indicators are generally shown
below or above the main price chart.
·
Average directional index a widely used indicator of trend strength.
·
MACD – Moving average convergence/divergence.
·
Momentum - the rate of price change.
·
Relative strength index (RSI) – oscillator showing price strength.
·
Relative Vigor Index (RVI) – oscillator measures the conviction of
a recent price action and the likelihood that it wil.
·
Stochastic oscillator – close position within recent trading
range.
Volume-based indicators
·
Accumulation/ distribution index – based on the close within the
day's range.
·
Money Flow – the amount of stock traded on
days the price went up.
·
On balance volume - the momentum of buying and selling stocks.
