👩🎓 🧑🎓 “
technical analysis” It is a way to study the behavior of stocks. By using
chart for the purpose of forecasting future
price trends
technical analyst will study the behavior of stocks from the
price and trading
volume (or trading value), which can be considered is an important source of information for
technical analysis However, the strategy in this
technical analysis. It’s not that all of a sudden it’s formulated without principles. But actually, there are three concepts or beliefs that this analysis is based on:
1. The behavior of the stock
price that is expressed Has absorbed everything that has happened. That means that when economic, political, etc. Changes affect the
supply and demand in stocks, of course, will affect the
price. Because the
price is set from
demand and
supply of stocks, so if the change occurs up is positive would cause more
demand than
supply. Or simply say
Buying force is greater than
Selling pressure. Will result in a
price on the other hand, if the changes are negative would produce more
supply than
demand. (
Selling force is greater than
Buying pressure) will result in the price going down.
👩🎓 🧑🎓
However, from the foregoing Key data that
technical analysts use to analyze will aim at
price and
volume. So it seems that
technical analysts shorten the scope of study analytical model Fundamental Analysis by jumping to study the conclusion of the impact. And pay little attention to the cause, for example, if the
price rises, it means a change in various factors. Quite positive But if mold The
price has declined. It means change in factors will be in the negative direction while analyzing fundamentals It will delve into the cause. Which is the driving force behind the resulting
supply and demand, but both approaches to solve the problem of the direction of the share
price that should be the same.
2. The
price will continue to move in the same trend. Until the original trend is really gone The above text contains complete in itself to give you an understanding and there is clarity in This is more. For example, you have thrown a ping-pong ball into the air. (Where the ping-pong ball is considered a stock price.)It can be seen that the ping-pong ball will continue to move up. It follows the direction of the throw and the throw (throw) at first, but over time, the momentum gradually weakens (for whatever reason). Will start to slow down until the transmission is exhausted The ping pong ball will fall down. Which the condition of the movement of the ping-pong ball From the throw until before the drop will be in the direction or upward trend. And will begin to change direction to a
downtrend (when the ping pong ball starts to fall) after the
uptrend has ended.
3.
Patterns or behaviors of stocks that have occurred in the past. It can be applied in the present and in the future, or what we might call
“history repeats itself” because
technical analysis is more dependent on
price and
volume, which reflect the net effect of the data source. (information set) in the forecast which the
price and
volume of this transaction as an
indicator of psychology in terms of courage or fear, etc., which no matter what era All of the above has never changed. Therefore, the
patterns that occurred in the past (reflecting psychology at that time) can still be used today. Including giving conditions or the probability for the direction of the stock”s movement to occur in the future.
👩🎓 🧑🎓 All three of the above can be considered concepts or fundamental beliefs that are the origins of
technical analysis. Let you know that Those principles have these ideas behind them. By the
chart itself It is not the cause of the stock
price rising or falling because of the
chart. It’s just something printed on a sheet of paper. But with the
technical analysis that you will study further, you have the tools to analyze. This will pull out what the share
price wants to tell you that the share
price will move in any direction. Or it is time for a trend change to occur.