When you talk about finances, the common term used is technical analysis. This is a method of security analysis to forecast directions prices by studying the past market of data usually, the volume and the price. Two of the most fields that use this method are behavioral economics and quantitative analysis. This is the type that became one important aspect in the active management and its efficacy also has been debated by the market hypothesis that states prices are unpredictable.
The fundamental analysts will examine the dividends, quality, new products, earnings, assets, ratio, research, etc. There are a lot of methods that are being used in this and one of it are charts. By the use of charts, doing the futures technical analysis can be very easy in identifying the patterns of prices and as well as the market trends for the financial market and for exploiting those patterns.
The technicians are going to search on the patterns such as the head and shoulders or double bottom or top reversal pattern, to study about technical indicators, to move the averages, and to look for forms like resistance, lines of support, channels, and some other forms that are obscure such as pennants, handle and cup patterns, flags, and balance days. They also use many kind of indicators and some of these are the mathematical transformation of prices. This transformation often includes up and down volumes and advanced or declined data and other type of inputs.
And also, they look at the relationships in between the indices of volume and price and as well as indicators. Examples for this are MACD, moving averages, and relative strength indices. Some other indicators that are also important are bear or bull ratios, implied volatility, call or put ratios, short interest, etc.
Many kinds of techniques are used for technical methods and the most common in use today is subjective judgment. This is in use for deciding the pattern to be reflected by an instrument and the interpretation of such pattern. Some technicians will use systematic or mechanical approach for interpreting and identifying patterns.
In contrast with it, the fundamental method is a study about the economic factors that will influence on how the investors will price their financial markets. In technical method, it is stated that the prices are already reflected to the fundamental factors. Some traders use either of the two methods while others use both.
This method is widely used by traders and some other financial professionals. Other people that uses it are market makers, day traders, and pit traders. But some people have said that it cannot really predict the future, instead, it can help identify trading opportunities since the evidences on this are inconsistent and sparse.
The principle of this is the prices will reflect all of the relevant information. And the reason for this is so that their analysis will look at the history of trading pattern of security rather than the external drivers. These drivers are the fundamental, economic, and also news events.
There are three basic principles that the analysts believe. These include market action that discounts everything, prices will move in trends, and history will tend to repeat itself. Thus, the action of price will tend to repeat because the investors will continue tending towards the patterned behaviors.
The fundamental analysts will examine the dividends, quality, new products, earnings, assets, ratio, research, etc. There are a lot of methods that are being used in this and one of it are charts. By the use of charts, doing the futures technical analysis can be very easy in identifying the patterns of prices and as well as the market trends for the financial market and for exploiting those patterns.
The technicians are going to search on the patterns such as the head and shoulders or double bottom or top reversal pattern, to study about technical indicators, to move the averages, and to look for forms like resistance, lines of support, channels, and some other forms that are obscure such as pennants, handle and cup patterns, flags, and balance days. They also use many kind of indicators and some of these are the mathematical transformation of prices. This transformation often includes up and down volumes and advanced or declined data and other type of inputs.
And also, they look at the relationships in between the indices of volume and price and as well as indicators. Examples for this are MACD, moving averages, and relative strength indices. Some other indicators that are also important are bear or bull ratios, implied volatility, call or put ratios, short interest, etc.
Many kinds of techniques are used for technical methods and the most common in use today is subjective judgment. This is in use for deciding the pattern to be reflected by an instrument and the interpretation of such pattern. Some technicians will use systematic or mechanical approach for interpreting and identifying patterns.
In contrast with it, the fundamental method is a study about the economic factors that will influence on how the investors will price their financial markets. In technical method, it is stated that the prices are already reflected to the fundamental factors. Some traders use either of the two methods while others use both.
This method is widely used by traders and some other financial professionals. Other people that uses it are market makers, day traders, and pit traders. But some people have said that it cannot really predict the future, instead, it can help identify trading opportunities since the evidences on this are inconsistent and sparse.
The principle of this is the prices will reflect all of the relevant information. And the reason for this is so that their analysis will look at the history of trading pattern of security rather than the external drivers. These drivers are the fundamental, economic, and also news events.
There are three basic principles that the analysts believe. These include market action that discounts everything, prices will move in trends, and history will tend to repeat itself. Thus, the action of price will tend to repeat because the investors will continue tending towards the patterned behaviors.
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