Category: Money tips Release Date: 2006-12-11
As opposed to fundamental analysis, technical analysis on the market have a grasp of the details of a very large leap forward. Transactions due to technical analysis a great help, but also led to a lot of elite people who put a lot of energy into this area, which ultimately led to where we can easily find a lot of books on technical analysis and a variety of different theories
. The scope of these theories is very wide, there are many or even develop into a four-dimensional, or the metaphysical level. Is very interesting is that each seems to have a very strong theory supported by empirical evidence. It also makes a lot of people have all the technical analysis as their pursuit.
Here, I am not critical technical analysis is useless, I want to say is that we should not be completely obsessed with this, in a large number of technical analysis, we should also remember that our ultimate goal is out of the technical analysis.
Technical analysis is the mainstay of the market and trading in this market, the crowd mental activity can reach a market limit, its form and rhythm of movement and its direction of movement. Therefore, from this extent it is more realistic than the fundamental analysis because it is closer to the market itself, which constitutes the daily trading, technical analysis can achieve the standard of fundamental analysis is difficult to achieve. One reason, of course, is that technical analysis somewhat more emphasis on quantitative analysis, fundamental analysis is more emphasis on qualitative analysis of the transaction, in particular the financial leverage for the use of a lot of foreign exchange market, quantitative analysis Very often, qualitative analysis of more than practical significance.
However, we can see that technical analysis of strengths at the same time, we will never have to remember is that the market technical analysis, rather than technical analysis determine the market.
We often see some very classic pattern top and bottom, we may see a lot of very classical order form, I want to express is not the classic form of top and bottom of the market led to the decline, but the market down this process, the formation of the formation of of these classic forms. Market, buyers and sellers at a time process, for the current price would be a very delicate position of the psychological mindset, mixing a variety of messages and data, the overall market, people will carry out their different responses, and then back to the market last gradually lead to the two sides in trade transaction forces change. For the market, as long as the buying power of larger than the power to sell, regardless of what kind of messages and data, the market will rise even further. However, these data and information will gradually affect the market transaction in which the crowd for their own position to reconsider, and finally in turn affect the overall relationship between the strength of such sales. In such a power conversion process, in the technical analysis, we will see these classic shape, therefore, not because the first M leading the market down, but the market fell through such a process must buy gas from the strong turn weak, selling gas from weak to strong. The head and shoulders only shows the process of this transformation a bit more complicated, buying power and buying gas ratio M is reinforced by the first little bit. The V-Top is illustrated in the conversion of buyers and sellers because the price of location and the involvement of certain elements of the power conversion is more sudden and rapid.
While the corresponding order form in fact also indicated that the market forces of the two sides in the transaction by the fluctuations in a space of roughly a balance, but the transaction inconsistent views on the direction of the final turn into the same process. Which eventually led to the original buyer and the seller agreed in a trading range into a new balance of power imbalances and ultimately reflected in market, on a technical analysis to reach a breakthrough in the traditional sense.
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