Technical Analysis Trading

Overall Rating: star ratingstar ratingstar ratingstar ratingstar rating[0/5]Total Votes [  ]  
Rate this page:
Technical analysis is the methodology applied to analyze securities and make investment decisions for trading financial instruments. Investment analysis are broadly classified into two categories -
  • Fundamental analysis.
  • Technical analysis.

Fundamental analysis

involves analyzing the characteristics of a company - its financial conditions and productivity etc. in order to estimate its market value. Technical analysis is a different analysis altogether. Unlike, fundamental analysis does not involved in valuation of a company or a commodity but technical analysis is all about price movements in the concerned financial market. The Technical Analysts are called Technicians or chartists and prepares charts representing price movements of stocks in different markets. The charts made by the technical analysts are used to define or estimate finance market trends, which further facilitates prediction. These predictions are used or referred by the brokers and individual investors for making rational investment decisions. Despite all the fancy and exotic tools it employs, technical analysis really just studies supply and demand in a market in an attempt to determine what direction, or trend, will continue in the future. If one can assess and understand the benefits and limitations of technical analysis, it can provide with valuable new set of technical tools or skills that will enable better trade or investment decisions.

Technical analysis -

its advantage and usage -
  • Provides guidance to Indian traders and investors in maximizing their returns from the markets and create wealth.

  • The robust trading systems and technical tools used together with sound money management principles helps Indian trader or investor to take advantage of market volatility, explosive moves and strong trends to extract maximum profits.

  • Indian traders and investors achieved above-average returns from the markets because technical analysis provided them with profitable trading signals and at the same time protected their trading capital from large draw-downs with sound money management principles.

Last Updated on 7th July 2011