Technical analysis of forex prices

In this section we will take a deeper look at the various tools employed by technical analysts in predicting the direction of the trend, and for deciding on entry or exit points. We will first study the main categories of forex technical analysis, and then examine some of the most popular indicators used in this type of analysis, in order to help you decide on the best tools for your approach.

Neither a great understanding of the markets, nor exceptional skills in mathematics is a necessity for being a successful technical analyst. Since the tools have been refined through decades of trial and error, we have all the principles laid out for us by the past wizards of this trade. Many scenarios have been examined, countless situations have been explored with technical tools, and what is more, with the backtesting capability of today’s software, the ways in which our technical schemes can be employed are practically limitless. With all this automation, the knowledge and experience that is readily available for students of technical analysis, all that is needed is patience and hard work.

Forex technical analysis

 

Forex oscillators — the predictive value of divergence and convergence

Oscillators give the trader limit values which he can use to evaluate the price action. The currency price is a number, and its range is limitless (it can move between zero and infinity). Read more...

A few general principles on technical analysis

Technical analysis studies chart patterns, and it aims to identify trends, decide on entry/exit points and determine the psychological attitude of the market environment. Read more...

Forex price action — reading the language of the market

Most of this text is fairly straightforward. The terms and descriptions that we use are often self-evident, and we hope that even someone with no experience of trading will be able to grasp the essence of the discussion with a... Read more...

Forex trend indicators

These indicators are used to gauge the strength and direction of a trend. As their name suggests, they are most useful in trending markets, and their usage in ranging markets is to be avoided because of the tendency to give... Read more...

The Perils of Forex Backtesting — how to evaluate a technical forex strategy

Trading involves numbers. We need to make a lot of calculations to analyze the price action and gain an understanding of market movements. While economic events usually follow a discernible pattern of cause and effect that may be evident even... Read more...