To predict future price orientation, not only in Forex but also in all market analyzes, the method of technical analysis is the way most investors apply and trust. Unlike basic analysis, it can produce quite objective remarks since it generally produces results with rational calculations and evaluation of past data. According to the assumption of technical analysis, prices proceed together in completely interrelated movements. All price movements are in a successive cycle. In fact, all these existing cycles and movements in it are the recurrence of any development in history. A movement of any effect within the normal course of the market is almost identical to a movement that has taken place under the influence in a similar manner at any given time. Therefore, every movement, every shape, every data on the price graphs are defined in a certain system and as long as it can be matched with any similar action in the past, it is easier to predict the future. This is because we know how prices reacted in similar situations in the past. We are likely to get the same results because it shows similar characteristics in the developing situation.
Technical analysis can be explained, scaled, placed on a certain number system, and allows for the identification of any movement that can adapt to mathematical realities. It uses many mathematically scalable tools ranging from the shape of the price chart to the average price averages, very complex calculations, drawing of tools, comparison to a purchase demand, and price comparison. As the results are generally expressed with exact numbers, there is no need for subjective interpretation for the investor. The investor only determines the appropriate position point for the right instrument by using the right techniques fit for him, comparing the instruments on the price to interact with each other, and so on, by introducing techniques that will have clear and precise results.
The beginning of technical analysis is the graphs and the ability to read these graphs. Reading the numbers expressed in the horizontal and vertical plane in the price graph is extremely simple as it contains the same properties as any mathematical plane. Our “Chart Types” section is designed to improve your basic skills for the beginning. It is configured to define price statements on the chart and to have the basic reading ability at a glance. Topics are related to price movements in the graph and the relevant issues related to the benefits are discussed.
The situation evaluations, formed by the movement of the price movements under certain rules and can be formed with the help of drawing tools, are explained in detail in the “Language of Graphics” section. When the basic assumptions about the flow of prices are connected to certain conditions with the help of the graphs, the first step of the technical analysis begins. Support, trend, resistance can be expressed as a lot and the basic tools that can be charted by drawing tools are explained with help from screenshots.
Indicators, also known as inductive indicators of technical analysis, were dealt with in a fully understandable language and with all the details. Indicator tools named as indicators used in the indicator area most commonly were shown on the graphs and their use was explained. Besides, information was given about how indicators work and calculation methods to ensure that the user gets clear ideas. An indicator selected from the group of indicators, grouped under a separate heading in the trading platform, is easily added to the chart. The indicator on the graph depicts the historical data by making mathematical calculations. That way, the investor can calculate the past period and consider the objective values when making decisions about the future.
The most well-known and used forms of formation have been explained in the “Formation” section with visual elements. The formation is the transformation of the candle bars forming the price movement into any shape known by one after the other in a certain order. The images the prices form visually can be considered as a message about the future. This is because the reaction is given by the prices in the historical behavior to the same forms can be comprehended with experience.
The formation group requires a perspective that demands imagination and experience rather than numerical values. To simulate the formations formed by candlestick lines to shape and to draw the boundaries for the simulated shape, it becomes a better developing skill with time since trying to introduce shapes into a known pattern can lead to an evaluation with incorrect results for a shape that does not exist. It may vary from person to person as it requires a subjective perspective when evaluating whether the formation looks like a formation or not.
The last subject of the technical analysis section is related to Fibonacci. With the book “Liber Abaci”, which was published at the beginning of the 13th century, the theories of the groundbreaking Fibonacci, especially for the development of European mathematics, are being used effectively in the financial markets today. Fibonacci return rates are designed according to Fibonacci’s golden ratio concept. In the Fibonacci section, the theories on the successful use of these tools are processed with visual elements.
In general, the platform discusses the technical and fundamental analysis in the discussion platforms and considers each other as competition and discusses their advantages and scarcities. In fact, they are two complementary methods. In some academic resources, it is advised to determine the points of the transaction by technical analysis while fundamental analysis should be used to determine market direction and investment decision. Besides, it is not incorrect to use only the technical analysis method. In fact, investors who have no economic knowledge and only enter the Forex market to evaluate their money can determine their strategies by producing results from the relationship of various technical analysis methods. This method is the most basic analysis method for investors with little or no knowledge about the economy.