For those who place their trust in numbers over news, this presentation is designed just for you.
To succeed in the stock exchange, it is crucial to have a strong grasp of the basics of technical analysis. While technical analysis cannot determine the fair value of financial instruments, it does offer the ability to predict future price movements based on market conditions.
This comprehensive lecture covers a wide range of topics including the fundamentals of technical analysis, the Dow theory, identifying trends, drawing trendlines, utilizing support and resistance levels, understanding the significance of channel lines, correction levels, and market gaps. In the second part of the chapter, you will delve into the Elliott wave theory, complete with step-by-step guidance for conducting technical analysis.
With 97 informative slides, this presentation is an invaluable resource for anyone looking to develop their skills in technical analysis and increase their chances of success in the stock exchange.
Number of Lessons: 19
Technical analysis relies on historical data and tries to predict the future based on that. Every analyst and trader should keep this in mind.
Three important assumptions which are inevitable if one wants to accept the conclusions as correct.
The first condition is that all information is reflected in the market price. The price isn’t generated by the chart, but by the supply and demand.
The second condition is that market prices always move in trends. The real task of the analyst is to recognise and identify the trends.
The last assumption is that prices reflect human behaviour and the history repeats itself. Closer examination of the below mentioned factors can lead to more punctual predictions.
Technical analysis consists of several tasks and branches. There are statistical analysts working with traditional chartist.
If the assumptions are right, mathematical statistics can provide advantages and past data can improve our forecasts.
Random Walk Theory states that the market price changes are independent and conclusions should not be drawn from past events.
The name of Charles Dow cannot be unknown as he has constructed the Dow Jones Industrial Average. The study published as Dow Theory is a milestone in the history of technical analysis.
Shorter and longer trends are often illustrated based on different scaling principles. The linear and logarithmic scaling methods are show on the same chart.
Capital markets move in trends. The biggest task of technical analysts is to identify trends. The trends can be Bullish, Bearish, and Neutral.
Finding the potential support and resistance levels helps to determine the direction of the trend. In this lesson, it is shown how peaks and troughs determine the support and resistance lines.
Determining the strength of the potential support and resistance lines is based on the following factors: volume, time horizon, newness, and integers. In this subchapter the psychology of trendlines is introduced.
Prices often move in channels along the trends. In this lesson the breakouts from channels and the target price calculation is described.
Correction or pull-back is when the share price moves in the opposite direction of the current trend. Many believes that the number sequences constructed by the famous Italian mathematician, Leonardo Fibonacci, determines the correction levels.
Reversal days are easy to recognise since they are always located at high or low at the end of the trend.
Market gap is a price range in which no trading happened. They are typical for markets where trading is not continuous. There are different types of gaps, this lessons describes them with examples and illustrations.
The most famous theory of the technical analysis is the Elliott Wave Theory, which was developed by Ralph Nelson Elliott. The main statement of Elliott is that the capital and money markets do not move chaotically and show cyclic waves.
What You’ll Learn:
In this course:
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