Sunday, October 10, 2010
Basic Technical Analysis
Labels: Forex Articles |
Introduction: In everyday life we know what is called trade. Trade in question is real trade, which occurs in real markets (markets, banks, and other places) in everyday life, where there is an exchange between money and goods, with the commodity being traded is the real goods. With growing age, start known also by the SPA (Alternative Trading System), where trade is no longer the case process of exchanging money and goods, but which are traded spot. For in Indonesia, which is included in the SPA is an instrument currency (forex), Stock Indices, and commodities. For an investor, the SPA is used as hedging (hedging) of real commodities.
Price MovementWhen we were still sitting in junior high, we had studied economics. Friends will remember with what is "economic law" is not it? Yes, the law of economics is about supply and demand (demand and supply). Let me give an example: (for illustration only, we go back to junior high school )...;=)Case 1: In a city, the number of producers of X number of lots, so more and more outstanding in the market, then consumers will more easily get the goods, so the price will be the cheaper product X is.Case 2: In a city, producers of good X only 1, while the demand for good X is very high, so that consumers are having difficulty in obtaining good X. So the price of good X increases.Thus it is clear what is called the law of supply and demand right?
In the capital markets (stock) trading occurs a number of shares (volume) with a valid trading system on the trading floor. More and more investors are interested in a particular stock, and the amount of capital that play in its increase, then stock prices will further go up. Similarly, what happens in financial markets (forex). In forex, commodities are traded is the difference in exchange rates of certain countries with other countries. I give examples of currency EUR / GBP (Euro exchange rate against the Rupiah). Think of all those with large and small capital in Indonesia to buy EURO which is available at the local bank of Indonesia, we can be sure the price of EURO will rise against the Rupiah beloved. Likewise, if the Big Boys in the EURO exchange in large quantities to the amount, then certainly EURO price will come down to dollars.price movement will always occur during the process of trading going on all over the world for 24 hours (when parts of the world this afternoon, in other parts of the world will be the night), ideally is 5 days in 1 week.
Market makersPrice movement is a representation of all the events in the market. So, the price move is not without reason, but there is a market maker. Who are they?1. Government2. Company3. Financial institutions, whether banks or non-bank4. Community5. Business people
GraphIf we make the process a record of price movements that occur during the period of time, then we plot the graph (simple), it would appear the tendency (trend) which way the price movement. In the old days, before developing the computer technology, IT and the Internet, traders use the image manually to analyze price movements. If the manually drawn on the price movement of a certain period based on the open-high-low-close (OHLC), it would appear like a line drawing (bar) or candles (candlesticks). The traders in Japan have been using candlestick patterns as a reference technique of their transactions, so the technique of candlestick pattern is considered the oldest techniques.
Technical analysis is an analysis of price movements, be it currency or stock, based on the past. Thus, there is the rationale that underlies it:1. Market Discount Price Everything: everything that happens in the market reflected in the price movements2. Price Moves In Trends: movement of the price moves in a certain pattern, whether it is the trend up, trend down, or sideways (sideways).3. History Repeat It Self: through a research and observation, it is concluded that the behavior of market makers in the past will be the same will happen now.When the fundamental analysis we find out what will be bought or sold, then by technical analysis we will find out when to buy or sell.
Piece StoryThere are 2 people trader, a fundamentalist one, and one teknikalis. Both of them are people who extrimis, and felt his trading approach is the most correct. The Fundamentalists accuse the teknikalis "buying a cat in a sack", the reason being the teknikalis not have a solid basis of the decision, so do not know what she bought. Conversely, the teknikalis accused the fundamentalists were "forced investors." Teknikalis's intent is the fundamentalists do not know the right timing to enter the market, finally comes to his position, but the fundamentalists always evasive, saying "his name is also an investment, it must be long term minded ...".Well, about this type of analysis where the most good?
Technical analysis is simple, but many who make it complicated. And to apply the law of simple technical analysis is beautifull. There are so many indicators in technical analysis, and can be guaranteed, the more indicators that are used the more confusing and ultimately we can not make a decision, because the indicators are to each other giving contradictory signals.
Price MovementWhen we were still sitting in junior high, we had studied economics. Friends will remember with what is "economic law" is not it? Yes, the law of economics is about supply and demand (demand and supply). Let me give an example: (for illustration only, we go back to junior high school )...;=)Case 1: In a city, the number of producers of X number of lots, so more and more outstanding in the market, then consumers will more easily get the goods, so the price will be the cheaper product X is.Case 2: In a city, producers of good X only 1, while the demand for good X is very high, so that consumers are having difficulty in obtaining good X. So the price of good X increases.Thus it is clear what is called the law of supply and demand right?
In the capital markets (stock) trading occurs a number of shares (volume) with a valid trading system on the trading floor. More and more investors are interested in a particular stock, and the amount of capital that play in its increase, then stock prices will further go up. Similarly, what happens in financial markets (forex). In forex, commodities are traded is the difference in exchange rates of certain countries with other countries. I give examples of currency EUR / GBP (Euro exchange rate against the Rupiah). Think of all those with large and small capital in Indonesia to buy EURO which is available at the local bank of Indonesia, we can be sure the price of EURO will rise against the Rupiah beloved. Likewise, if the Big Boys in the EURO exchange in large quantities to the amount, then certainly EURO price will come down to dollars.price movement will always occur during the process of trading going on all over the world for 24 hours (when parts of the world this afternoon, in other parts of the world will be the night), ideally is 5 days in 1 week.
Market makersPrice movement is a representation of all the events in the market. So, the price move is not without reason, but there is a market maker. Who are they?1. Government2. Company3. Financial institutions, whether banks or non-bank4. Community5. Business people
GraphIf we make the process a record of price movements that occur during the period of time, then we plot the graph (simple), it would appear the tendency (trend) which way the price movement. In the old days, before developing the computer technology, IT and the Internet, traders use the image manually to analyze price movements. If the manually drawn on the price movement of a certain period based on the open-high-low-close (OHLC), it would appear like a line drawing (bar) or candles (candlesticks). The traders in Japan have been using candlestick patterns as a reference technique of their transactions, so the technique of candlestick pattern is considered the oldest techniques.
Technical analysis is an analysis of price movements, be it currency or stock, based on the past. Thus, there is the rationale that underlies it:1. Market Discount Price Everything: everything that happens in the market reflected in the price movements2. Price Moves In Trends: movement of the price moves in a certain pattern, whether it is the trend up, trend down, or sideways (sideways).3. History Repeat It Self: through a research and observation, it is concluded that the behavior of market makers in the past will be the same will happen now.When the fundamental analysis we find out what will be bought or sold, then by technical analysis we will find out when to buy or sell.
Piece StoryThere are 2 people trader, a fundamentalist one, and one teknikalis. Both of them are people who extrimis, and felt his trading approach is the most correct. The Fundamentalists accuse the teknikalis "buying a cat in a sack", the reason being the teknikalis not have a solid basis of the decision, so do not know what she bought. Conversely, the teknikalis accused the fundamentalists were "forced investors." Teknikalis's intent is the fundamentalists do not know the right timing to enter the market, finally comes to his position, but the fundamentalists always evasive, saying "his name is also an investment, it must be long term minded ...".Well, about this type of analysis where the most good?
Technical analysis is simple, but many who make it complicated. And to apply the law of simple technical analysis is beautifull. There are so many indicators in technical analysis, and can be guaranteed, the more indicators that are used the more confusing and ultimately we can not make a decision, because the indicators are to each other giving contradictory signals.
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