Technical analysis

What is technical analysis?

A method for the study of past price movements as they are and regardless of their causes to predict future direction based on certain assumptions proved the validity of experience in most circumstances

Key assumptions upon which technical analysis

Of the most important of these assumptions:

The price movement Preference Prices move in Trends

And meant that although the price movement appear in the short term like random movement, but that this movement has a certain direction is headed either up or down.

The price of a currency rises and then come back and drop a little bit and then come back rise rapidly and then drop a bit, then go back up strongly .. Etc. .. Although it may appear, this movement like random movement between the rise and fall, but when checking to consider the longer notes that the price of a mile Trend upward even though he was down sometimes but rising always be more and stronger even though he was oscillates between the ups and downs However, wholesale rises more and more.

This is called Mel Price Trend

Undoubtedly, you now know the importance of this hypothesis ..

It is enough to know that the tendency currency rate upward to you purchase assured even if the price falls somewhat because you know that the price has a tendency to rise and therefore will rise after a period and will be able to sell at a higher price, and vice versa for miles price downward as enough to reach to the conclusion that for the price of one currency Mel downward until you sell them to buy later at a lower price.

In fact, the hypothesis Preference Price Trend analysis is the most important assumptions that have proved the validity of experience in various conditions.

History is repeating itself History repeats it self

And so that means the price movement "behave" in the same way that "Sketha" If circumstances were similar.

An important this hypothesis emerged major categories of technical analysis is indispensable such as support and resistance patterns and others.

Hypothesis constant tendency Trends exist until not broken

And so that means the price of the currency tends to rise it will continue to rise, until the contrary is proved

If the price of the currency tends to drop it will continue to decline, until the contrary is proved.

Please do not feel terrified of these terms!!

Will learn later that these statements are very clear and simple and you will be able to just elastosis identify them as soon as a glimpse into the price movement.

How is technical analysis?

Is technical analysis using charts that show price movement of a currency - or shares or commodity - for periods ago and so that the stores have a look at the chart for the price of one currency and then using techniques Technical Analysis will be able to anticipate what will be the price of the currency after a period of time and the Based on this expectation and by the power of its potential will take decisions sale of these stores or buy currency.

You can take a look at a model for such graphs, which is working on analysis traffickers in Figure (1) below, and remember you from such fee you can reap millions!.

Form (1)

Reflects the drawing above the rate of the euro against the dollar within a few days, the stores studied this painting and the application of techniques Technical Analysis attic to be able then to infer how could become the euro against the dollar in the coming days, if reached convinced that the price of the euro against the dollar will rise will buy euro but if he has reached to the conclusion opposite will sell the euro.

We will shortly explain every part of the chart and remember that a little of practice you'll find that everything We will remember him in this part is very simple and clear.

Where can I get on the charts?

Most brokerage firms offer service to its customers get a graph which shows the movement of the currency rate, as there are plenty of sites that provide you with graphs for all rates of some of these institutions offer this service for free and some for a fixed monthly subscription. This service is available mostly through a special program that you download download to your computer at the mouth can choose any currency chart you want. These programs deliver price movement of each currency abreast of your device in the form of graphs make follow-up and audit the issue is very simple, and it must of course be connected to the Internet in order to be able to receive information immediately from the site of the brokerage firm or from the company that offers you a service fee charts, but that was not connected to the Internet, you can learn the previous price movement but you will not be able to get new information only when you connect with the company's site on the Internet.

 We will first talk about some of the concepts that will make you understand the subject more easily and accurately.