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TECHNICAL ANALYSIS


Technical analysis can be applied to all kind of financial markets like stock-markets, commodity markets and the currency exchange market.Technical Analysis Section


1. Introduction to Technical Analysis

Technical Analysis is a widely used Trading Method that aims to forecast future price movement of a market or an asset based on the evaluation of past price movement and on other activity data. Technical analysis is certainly not able to predict the future, but it can help investors to evaluate the possibility that a certain scenario may occur -For example evaluate if a current price trend will continue or it will be reversed into the opposite direction. Furthermore and most importantly, technical analysis can help investors to identify the perfect timing to enter and to exit the market. Technical analysts use charts, patterns, indicators and oscillators to identify similarities in current and past market activity that can suggest future price movements. Technical analysis can be applied to all kind of financial markets such is stock-market, commodity market and the currency exchange market. Technical Analysis is more intense in the Short-Term while Fundamental Analysis is more intense in the Long-Term.

"Think Technical analysis as the soul of the market while fundamental analysis as its brain"

2. Technical Analysis on Trading Center -The unique TCI System

Trading Center has developed its own system of technical analysis called TCI (Trading Center Indicator). From time to time you will be able to find at TradingCenter free trading signals generated by TCI. The TCI system can be applied in any Financial Market (Forex, Stocks, Indices, Commodities) and in any time frame. But what makes this system unique is the ability to turn backwards and forwards:

“Looking back to identify what to buy –looking forward to identify when to buy it”

Here are some basic TCI features:

1. Analyzes any market or any financial-traded asset within any timeframe

2. Identifies Overbought / Oversold levels of any Market / Traded Asset

3. Identifies the time pattern of any price movement

4. Indicates specific dates to enter / exit the market or to buy / sell an asset

5. Compares condition of different markets / Compare current market conditions with historic conditions

7. Draws short-term and historic TCI Charts / Apply technical analysis directly on a TCI chart

Enjoy TCI Signals as long they are offered for free in TradingCenter.org!

Trading Center Indicator (TCI)

3. Trading Signals on Trading Center 

Trading Center provides investors with its own signals (TCI Signals). Mainly TCI signals are focused on the Forex Market but also on Stock Indices, Popular Stocks and Gold Trading. Using the below calendar you may find old TCI signals and evaluate their performance. In every new TCI signal the first thing we do is to evaluate the performance and the accuracy of the previous TCI signal. TradingCenter provides one or two trading signals per month.

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External Trading Signals

In Trading Center you can find also comparison tables of other external signal providers (partners). We can't recommend none of them, it's up to you.

» Forex Signals | » Forex Robots | » Binary Option Signals | » Stock Trading Systems

4. Major Assumptions of Technical Analysis

Here are the basic assumptions when technical analysi is used:

1. Full information and fundamental factors are already incorporated in the current price level of the market

2. Prices of financial instruments are moving in trends

3. Price movements are not random movements

4. Historic trends are usually following repeated patterns

5. There is no particular time-frame when trading the markets  

Learn Also about: i) Three important short-term trading variables | ii) How to evaluate a trade using technical analysis | iii) The components of a Simple technical analysis framework 

 Learn the Basics of Technical Analysis

5. Popular Technical Analysis Indicators

Technical indicators are mathematical calculations based on price volatility and volume activity. These tools are used to confirm the trend of the price movement of a financial security but also to generate buy or sell signals. Indicators can be assessed using fully automated systems (like Metastock) or by individually designed systems (mainly in Ms Excel).

Commonly used Technical Indicators -Press Slider Below:


1) Bollinger Bands

2) Simple and Exponential Moving Averages

3) MACD (Moving Average Convergence Divergence)

4) Relative Strength Index (RSI)

5) Stochastic Oscillator

6) Accumulation / Distribution

7) Put / Call Ratio

8) Average Directional Index (ADX)

9) Correlation Coefficient

10) Chaikin Money Flow

11) Balance Volume -OBV

12) William %R

13) Volume-weighted Average Price (VWAP)

 Technical Analysis Indicators 


Major Forex Indicators

Using Technical Analysis Tools to trade the Forex market is a complicated but a common task for every Forex trader. In this section you may find information about the major technical indicators that are applied in the Forex Market.

 Forex Technical Indicators


6. Major Types of Charts

Charting is really important in technical analysis. There are four major types of Charts:

1) Line Chart |  2) Bar Chart |  3) Candlestick Chart |  4) Point and Figure Chart

Learn also about the three most common Charting Indicators.

 Major Types of Charts |  Identify Patterns

Major Chart Types Combined

 

7. Elliott Wave Principal and the Stock-Market

An American accountant called Ralph Nelson Elliott studied price movements in the US markets in 1930’s and suggested that some particular price movements (chart patterns) have the tendency to repeat during different time periods. Elliott wave patterns consist two phases: impulsive and corrective phase.

The two Phases of the Elliot Wave PrincipalIn this section you may learn also about:

-Short-Explanation of the Elliott Wave Principle

-The Correlation of the Wave Principal and the Fibonacci Sequence of Numbers

► Elliott Wave Principle


8. More on Technical Analysis

Fibonacci Sequence of Numbers 

Fibonacci numbers were introduced by the Italian Leonardo Fibonacci in the early 1200. In the Fibonacci sequence of numbers each number equals the sum of the previous two numbers. Here are the first numbers of the sequence: 1,2,3,5,8,13,21,34,55,89,144,233,377,610,987 etc. In addition any given number of the Fibonacci sequence equals 1.618 times the previous number and 0.618 of the next number.

Learn more about Fibonacci Sequence of Numbers

Price Gaps

A price gap evolves when a stock opens at a higher price than it closed. Post and pre-market activity are no importance for defining gaps. Gaps are usually the outcome of news realized. Gaps are also common phenomenon to low volume activity stocks. There are three main types of gaps.

Learn more about Price Gaps


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