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Stock Technical Analysis and Graphics
Stock Technical Analysis
The technical analysis includes the second group tools (along with the fundamental analysis) that the stock exchange analysts use to try to comprehend the market and to anticipate its future movements.
The technical analysis includes the second group tools (along with the fundamental analysis) that the stock exchange analysts use to try to comprehend the market and to anticipate its future movements.
The technical analysis is bases on the fact that is the own market that gives the best information about its future evolution and of the securities in it. It’s centered, on the study of the market and it’s applied not only to securities but also on indexes, merchandise and foreign currency.
It began in the past century when the companies weren’t obliged to give financial information to the shareholders and the only information available was that of the own market (prices, contracting, numbers, etc.) The objective: to anticipate a tendency change that would provoke a decision that will be maintained until another new change appears.
The technical analysis is based on the fact that is based on the following hypothesis:
The market offers enough information for predicting its tendencies
The prices oscillate following determine movements or pauses
The past determines the future.
Graphics
The graphics or charts are the pillars of the technical analysis. Some technical analysts, the chart makers, are base exclusively on the use of charts for the forecasting and for making commentaries about the market.
We must emphasize that to make a trustworthy prediction through a chart you need data about the evolution of the market or of a determined security during a considerable lapse of time.
If a security has a short time quoting the analysis is not possible due to a lack of perspective.
Other considerations to have in mind are usually, a variation on the price that surpasses in 3% the former price (significant variation).