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Foreign exchange technical analysis of three the characteristics of technical analysis

2023/2/25 2:30:18  Classification:   Participation: 10  

rebatesinforex rebateinforex bestforexrebate method attempts to use the past behavior of commodity prices to make predictions about its future direction, it believes cashback forex the fundamental factor determining the price of foreign exchange in the market supply best forex rebate demand, rather than its intrinsic value in the centuries-old h rebatemeaninginforextory of the free market, generations of speculators to technical analysis as a magic weapon to get rich Wall Street technical analysts talk about such things as support and resistance lines Technical analysts on Wall Street talk about technical terms and theories such as support and resistance lines, head and shoulders charts, 50-day averages, volatility theory or cycle theory, etc., but their comments on the market always give the impression that technical analysis is a paper exercise and an afterthought. Most professional investors in the United States are also based only on fundamental analysis, they are interested in any factor that affects the operation of the countrys economy and the fluctuation of the exchange rate, but do not care about the technical analysts are concerned about the behavior of the exchange rate However, for many short-term traders, technical analysis is the basis for trading decisions, is a guarantee of long-term profitability years of experience can show that the financial trading market does exist Contrary to the efficient market hypothesis, information asymmetry often occurs in the market and most market participants often behave irrationally. The advantage of technical analysts is that they can react faster than other investors by analyzing currency movements and discovering the behavior of the few who have priority over information. At the same time, the human psychology of greed and fear can never be changed. Technical analysts can find out the habits of most market participants that cannot be changed from the changes in the exchange rate, and operate in the opposite direction to obtain extraordinary returns. Technical analysis, like any other forecast, is based on historical data, but the biggest advantage of technical analysis over fundamental analysis is that there is no need to worry about the credibility of the data, while fundamental analysis has the double risk of data and forecast extrapolation in terms of credibility. Every trader who relies on technical analysis must develop an individualized, statistically guided trading system based on the examination of historical data, and each buy and sell signal of the trading system must be accompanied by an estimate of the probability of the signal being correct, the average profit when correct and the average loss when wrong, as well as the frequency of the signal and the corresponding annual return. In addition, in order to take full advantage of the statistical significance of the trading model, technical analysis traders must conduct frequent short-term trading, so that the cost of trading has a huge impact on the profitability (at present, the commission on foreign exchange transactions is basically zero, and the cost of trading is mainly the bid-ask spread) The larger the amount of trading capital, the higher the liquidity of foreign exchange, the greater the impact of short-term trading on the market, and the corresponding Technical analysis of trading systems are generally more suitable for traders with small amounts of capital and flexible operations, which is the real reason why larger mutual funds can not effectively use technical analysis method but they can create a local direction of price trends, rounding up small and medium-sized investors Finally, the biggest feature of technical analysis is used to choose the timing of entry, which is particularly important for foreign exchange trading because Margin trading determines that you can not buy like a stock transaction on the cover, once the timing of entry is not right, it is likely that you will be a huge loss, even if your judgment of the general trend is accurate because you can not wait for that moment, a medium-level fluctuations or even a few minutes may make your money to nothing!

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