Technical Analysis

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Capital Essence's Investment Blog- 錢途集團 » Page not found  Dec 10  Comment 
This is Capital Essence's CEM News - Market Outlook (the technical analysis of financial markets) for December 10, 2014. ...our “U.S. Market ETF Trading Map” rates the S&P as a Hold. Key technical development in Tuesday trading session...
SeekingAlpha  Dec 9  Comment 
Benzinga  Dec 9  Comment 
Tesla Motors Inc. (NASDAQ: TSLA) shares continued a downward trend Tuesday after a technical analyst suggested the stock could go as low as $165. Reading the technical levels in Monday's trading, Orips Research's Zev Spiro discerned a "bearish...
MarketWatch  Dec 9  Comment 
The S&P 500 has turned lower this week, reversing sharply from all-time highs. In the process, notable support points are under siege.
guardian.co.uk  Dec 9  Comment 
The major players in the world economy all have the potential to grow at different speeds while taking divergent paths – policymakers should take note of the risks In the coming year, “divergence” will be a major global economic theme,...
The Economic Times  Dec 9  Comment 
"In a chat with ET Now Mitesh Thacker, Technical Analyst, miteshthacker.com shares his trading startegy for tomorrow."
MarketWatch  Dec 8  Comment 
Divergence will be a major global economic theme in the coming year, says Mohamed El-Erian.
SeekingAlpha  Dec 8  Comment 
The Economic Times  Dec 3  Comment 
More positive news for the US economy was reported on Wednesday as US private employers added 208,000 new jobs, according to the ADP National Employment Report.




 
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Technical Analysis is the the study of the historical trend in an investment's price in order to predict future price movements.

Care must be taken when using technical analysis to be aware of fundamental events as they can invalidate prior technical analysis and cause large market shifts. In fact, a competing form of analysis is fundamental analysis.

The process of technical analysis can be applied to most markets including markets for commodities, securities, and currencies. Key concepts involved in technical analysis include: charts, support, resistance, trends and indicators.

Charts

Charts are graphical representations of market price and/or volume information in some time frame. For example, published charts generally provide hourly, daily or weekly data. One of the most common types of charts used for technical analysis is the Candlestick Chart. Formations, such as the commonly recognized Head and Shoulders pattern, can often be used to predict future price movement with a relatively high degree of accuracy.

Support Level

Support, within a particular time frame, is defined as a point at which a falling market price finds a bottom and does not fall any further. The price appears to bounce off of support levels and return to higher levels. There is no guarantee that a prior support level will continue to be a support level in the future.

Resistance Level

Resistance is similar to support. However, resistance is the point at which a rising market price finds a top and does not rise any further. Again, resistance may be applied to a time frame and of course a previous resistance level may fail to provide resistance in the future.

Trends

Market prices will often drift higher or lower in a series of waves. If a market is making higher highs and higher lows then it is generally considered to be trending up. If a market makes successively lower lows and lower highs then it is considered to be trending down.

It is often useful to draw a trend line along the levels of support and resistance. In particular, it is common for these trend lines to form a channel which can then be used to make trading decisions. Of course, a market may follow trend lines for a period of time but there is always the risk that it will stop doing so.

Indicators

Technical analysis often relies on the use of indicators. These indicators use mathematical formula to analyze price (and perhaps volume) action. Charts can be made using the indicator values and the information they provide can also be used to make trading decisions.

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