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Main 3 principles of forex technical analysis

Moshalabi

New member
Technical analysis is the most popular tool used and applicable to stocks, indices, commodities, futures, cryptocurrencies or any tradable instrument where the price is influenced by the forces of supply and demand.
Technical Analysis is the estimating of future price movements based on an examination of past price movements.
Technical analysis uses the indicators and a wide variety of charts that show price over time.
Technical analysis can be used for any freely traded security in any financial market
Traders use technical analysis to anticipate price movements, which makes it easier to distinguish areas of buy and sell.
Price data or market action refers to any combination of the open, high, low, close, volume, or open interest for a given security over a specific timeframe.
The timeframe can be based on Intraday data 1-min, 5-min, 15-min, 30-min, 1-hour, daily, weekly, Monthly.
Principles of technical analysis :

  1. Market movement controls everything
  2. There are trends in price movement
  3. History repeats itself

  1. Market movement controls everything
This is the cornerstone of technical analysis and if the meaning of the first rule is not fully realized and accepted, it will not be easy to interpret the other rules.
All technical analysts believe that the price movement is only a reflection of the changes in supply and demand.
If the demand exceeds supply, the price will go up, if the supply exceeds the demand, the price will drop. This movement is the basis of all economic forecasts.
If the technical analyst thinks about this, In the case of a rise in the price, whatever the grounds for its advance, demand must outweigh the supply, and that the fundamental analysts will be pressured to get the price for the upward trend. Conversely, analysts will try to take the price for a downward trend in the case of a drop in price.
 
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