Technical analysis of "Forex" (market). What is the summary technical analysis "Forex"

Everything that happens in the world in the political and economic sphere will inevitably affect the currency market. Including in the forecasts the external factor, the trader appears much more probability of the correct forecast.

However, one must understand that it is a question of forecast, no more, no less. The market can behave in a completely unpredictable scenario, and the entire calculated probability - both logical and calculated with the help of various special tools - will turn out to be wrong. Nevertheless, traders to learn the laws of the market is necessary for successful trading on Forex.

Technical analysis of the Forex market is rather multifaceted. A lot of tools are used in the form of indicators, programs and other things. Various kinds of estimation are applied, among which candle, graphic, summary technical analysis Forex and others.

What is technical analysis

Technical analysis of Forex is the main way of its research and is to predict the movement of prices, based on previous fluctuations. Basically, it is used to track prices on foreign exchange and stock exchanges. You can track the fluctuations in value and calculate its likely growth or decline through technical analysis of the Forex market. Books about Forex are quite popular, a huge number of articles are written on this topic. And this means that interest in it is not quenched.

Forecasting is built on the analysis of the series of prices in their time interval. Other statistical information is also used. The task of technical analysis is only to consider the direction in which the price moves, without taking into account the causes of this phenomenon. The correct definition will help you choose a position that generates revenue in any market, including Forex.

Axioms

• Reflecting price information

It is about the information needed to analyze the price, which is included in the bidding. The market forecast is based on the price behavior. For technical analysis, external factors are not needed, which makes it much easier to obtain.

• Subordination of prices to trends

This axiom means that in its movement prices have a certain pattern. Therefore, they are divided into rows for a certain period of time, during which they change in any one direction. The graphs look wavy and consist of peaks of ups and downs. Proceeding from this, three main trends are singled out: ascending (rising price), descending (falling price) and lateral (unchanged price).

• Repetition of history

Every event in history as a whole, and in the foreign exchange market in particular, tends to be repeated, because the parties involved treat it equally. Therefore, anyone who is familiar with the past can understand and develop in the future. Thus, when studying the situation on the market, one must find one that has already been in the past, which will allow us to draw the right conclusions about further development.

Technical Analysis Tools

Evaluating the information obtained after the technical analysis, the trader begins to build a forecast using various tools, which are described below.

Fibonacci levels

Levels consist of lines that are divided into parts, which are called meshes. Thanks to them, waves are monitored, and if you learn how to use it, you will see the most profitable places for entry and exit. One of the nets is called correctional, thanks to which the trader tries to calculate to what level the price will reach. The other grid is the target grid, through which the wave motion is calculated.

Indicators of technical analysis of Forex

Bill Williams' Trending Oscillators and Volumes

Indicators: zigzag, ADX, CCI, ATR, Alligator, Fractal, Ichimoku Kinko Hyo, Moving Average , Bollinger Bands, Parabolic SAR, Bears Power, Standard Deviation, Envelopes, Bulls Power, Bears Power, Relative Strength Index, Stochastic Oscillator, Relative Vigor Index, Williams Percent Range, MACD, Force Index, Momentum, Awesome Oscillator, DeMarker, On Balance Volume, Market Facilitation Index, Acceleration / Deceleration, Money Flow Index, Gator Oscillator

However, applying only indicators in practice, it is rarely possible to trade successfully. This is because they are simply unable to predict, but can only show the situation of the present moment.

To use them in trading, of course, you just need to clearly understand what they can and what is not.

Therefore, the most effective tool will be the combination of all methods of forecasting the price movement.

Programs

To help the trader special programs for technical analysis of Forex are issued. When using them, you need to take care of constantly updated data for currency pairs. These data, as a rule, consist of periods that should be taken into account so that the technical analysis of the Forex market is successful.

Also, the programs should support those indicators, which the trader is going to observe.

Programs can calculate Fibonacci levels and compile information and price charts. In addition, some of them are able to save chart templates and, if necessary, apply them; To receive a chronicle of data on exchange rates; Sign the graphics.

What is fundamental in technical analysis

All information is reflected in the price change on Forex. Basics of technical analysis are based on the price and volume of trades for a certain time. On the behavior of prices are built forecasts of the development of the market in the future. There is no need for any factors from outside. Therefore, the forecast is built fairly quickly and with a high probability of accuracy.

Prices are moving along certain trends. It means that the price is not random, but is subject to trends. Therefore, the movement of prices over time is divided into certain intervals, where it moves in some direction. That's why graphs have the form of waves, which consist of peaks of ups and downs.

Everything in the world is repeated - both the history of mankind and the history of the Forex market are cyclical. Therefore, knowing about past situations, it is possible with a high degree of probability to predict future fluctuations. Figures of the technical analysis Forex have been developed just on the basis of the given axiom. The first such method was "Japanese candles", which were first used in practice by rice traders.

Japanese candles

The history of the invention refers to the seventeenth century. He applied it to the Charles Dow market, using the basic principles. Another financier later developed their graphic model.

A simple chart with changes that occur on the market can be used either separately or in conjunction with a linear chart. Thanks to its clarity, it quickly gained popularity among traders around the world. And from the nineties of the last century it was considered a universal method for demonstrating the situation of the financial market.

Graphical Analysis

There are many methods used in the foreign exchange market. The main one is graphical analysis, it is based on the construction of graphs demonstrating price behavior in the formation of certain figures. There are different types of figures: continuing - involving the assumption of motion in the same direction as in the figure; Reversal, indicating a change in trend and so on. This method is quite effective and convenient, but it is not accurate.

Figures of technical analysis FOREX

With the help of figures make predictions about the movement of the market: continuation or spread. By these parameters, they are different. Figures can be either one or both types at once. And the trader needs to determine the type of the technical analysis forex figure in order to calculate the further behavior of the price.

When plotting a chart and determining the type of a figure, you should not forget about the possibility of an error. Therefore, traders who have traded on Forex for a long time already use several indicators for fidelity and reliability.

The most likely are the signals of the figures, which are based on large intervals of time. Although they use them in the short term.

With the correct definition of the figures, the trader appears more likely to foresee the situation in the financial market and time to prepare for them.

The most famous figures are: Triangle, Triple Bottom, Diamond, Wedge, Double Top, Triple Bottom, Triple Top, Flag, Double Bottom, Pennant, Saucer.

Consolidated Technical Analysis

Consolidated technical analysis of Forex is a mathematical calculation of the capital market movement , evaluation of statistical data on certain assets.

The data here are Forex quotes, which also include currency pairs and trading volumes.

The task of this analysis is to predict the price change of the asset for a certain time.

The application of this analysis will manifest itself in short trading positions, where the traders will come true with correct forecasts. At their disposal there is a large number of complex mathematical tools, most of which are the so-called lagging indicators, which are calculated on the basis of recent prices. Having learned to use these tools competently, the forecast will not be difficult to make.

However, such ready-made solutions should be treated with caution, because, relying entirely on machine calculations, trade can become thoughtless. Without understanding the essence of the Forex market and using the proposed mechanisms automatically, it is unlikely to make a stable profit on Forex.

Methods of technical analysis

The most difficult method of forecasting is mathematical. It is based on different formulas and algebraic calculations. On the basis of this method, market indicators are built. There are two directions: flat and trend.

In the trend direction, the line crosses the entire graph according to the calculated formula. Depending on the level at which the time series of prices of this line is located, forecasts are made about how the foreign exchange market will be built. The main thing here is to find a formula in order to build a trend. Flat, or lateral trend, is to build a line indirectly showing proximity to price extremes.

Both methods, depending on the scale, can be similar to each other, and therefore the point from which the reasoning will be constructed is rather difficult to find.

Another method, called cyclic, is based on the eponymous theory. According to it, changes occur regularly in cycles, like day-night. This theory builds even trading systems, for example, forex trading robots that give advice to a trader, buy, or, conversely, sell currency.

Based on the foregoing, you can get an idea of how to do technical analysis of Forex. It helps to predict prices by providing the trader with income in the foreign exchange market.