If we compare trading in the currency market with trading in other assets, we can note that the first difference is that the value of any currency is always considered a relative value. This is due to the fact that it must necessarily be expressed in units of another currency.

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Thus, the task facing the investor becomes more complicated. Because you need to look not only for the strongest or weakest currency, but also to find a suitable pair for it.

The foreign exchange market, compared to others, is the most technical and least subject to various interventions of central banks and manipulations. The same cannot be said about stock or bond markets. The technicality of the market lies in the fact that methods based on , wave, for example, as well as cyclic methods work very well.

How important is the method by which you trade in the Forex market?

You can trade based on fundamental data. However, without technical analysis, fundamental analysis cannot cope. I must say that technical analysis without fundamental is also of little use. This means that fundamental analysis can help determine what the dynamics will be for several years. At the same time, Technical analysis helps to catch the point for entering or reversing into this market. That is why technical analysis in the foreign exchange market, without a fundamental one, will be ineffective.

Are there criteria for comparing currencies, as is done with indices in stocks?

Several indexes exist. For example, for the Dollar, as well as the Euro, there is also an index for the Yen. These indexes are compiled on currency basket base, which are formed in proportion to the share that each currency contributes to the trade balance of each state of the USA, the Eurozone and, for example, Japan.
These indexes are also very technical. They have special futures contracts, but they are more subject to the factors studied by fundamental analysis. They are less subject to weekly or intraday fluctuations.

Technical methods. What is their potential?

Most of the technical methods of market forecasting were developed initially for regulated markets, where the positions of regulatory authorities should be strong. These include stock markets - classic, where a trader has the opportunity to receive a report on the time and volume of transactions, on the basis of which construction and further modeling of prices for the future are carried out.

However, in the Forex market, despite all attempts to centralize trading, it has not yet been possible to do this, and the interbank structure of trading is preserved here. In fact, trading is conducted by counterparties without intermediaries - directly. Therefore, the question arises about the legitimacy of using digital data for modeling foreign exchange market.

The trader asks himself a question! To what extent will its information system be adequate, and how will it correspond to the real situation on the market. The question arises whether he is playing with some kind of trading simulator. When it comes to the foreign exchange market, the relationship of the price component of the market is especially important, as well as the time component - the correspondence of the transaction price with the time of its execution. Distortion of these parameters leads to strong distortions of price behavior in the future.
Based on all of the above, the Forex market is very difficult to predict. It is said that traders fall into two categories.

• 1. The first do not even know what Forex is.
• 2. And the latter do not like him.

Another look at technical analysis in the Forex market

Internet trading in recent times going through its heyday. This leads to revolutionary changes in the activities of investors. Computers allow everyone to participate in the work of world currency and other markets. And you can do it from anywhere. the globe.
For some, this may be the ideal business. Thoughts are converted into money immediately without any intermediate stages that are inherent in other entrepreneurial activities. In addition, you can earn quite a decent profit on the Forex currency market.

At the same time, fundamental market research is a rather difficult activity. That is why most investors use not fundamental, but technical analysis in the foreign exchange market.

Look

Technical analysis in the foreign exchange market and features of the analysis and the market

The main task of technical analysis is the definition of the trend that prevails in the market. This is necessary in order to go in the direction in which it is logical to do so.
This is possible because one of the postulates of technical analysis tells us that the price takes into account absolutely all the news that is currently available. In other words, it can be used as a leading indicator of fundamental data.

Note that the most significant ups and downs in history began when there was nothing, or almost nothing, from a fundamental analysis point of view, foreshadowing changes on the chart. The main feature of the foreign exchange market is its practically unlimited capacity, that is, there are no restrictions on the amount of investment. Therefore, the income will be unlimited.

In addition, this market is very highly liquid. That is why all the principles and methods of technical analysis work in Forex in the best possible way.

From the origins of technical analysis to its modern features

In the pre-computer era, technical analysts were considered weird to say the least. They could look at large sheets of paper with charts and determine the likely direction of price movement.

The introduction of computers into our lives has made technical analysis in the foreign exchange market simple and understandable, and programs that examine the price chart have become something commonplace for most traders.
When the public currency market arose, many people strongly doubted that the provisions of the theory of Charles Dow, the man who is a classic of technical analysis, could be applied to currency trading at all.

However, over time, everything became clear and simple. It turned out that it is in currency charts that there is something that is not in other instruments. It's about continuity. In such conditions, it turned out that the methods of technical analysis: the theory of Elliot waves and other tools work in this mass market, where the turnover of trading is high, in the best way.

Is the foreign exchange market really as profitable as many people say about it?

Today, the derivatives market gives the highest yield. And the Forex market is called the languor market. The main participants of this financial platform are large commercial banks. Therefore, stable profitability in the Forex market in terms of working with moderate risks is inferior, for example, to the stock market.

One of the main analytical tools of a trader in the forex market is technical analysis.

Technical analysis in the Forex market, it is a set of analytical methods and analysis tools that, based on the study of patterns of changes in price movements in the past, make it possible to determine the future direction of price movement with a high probability, as well as to identify the best entry points to the market or opening positions.

Technical analysis is based on three basic rules:

1. The price includes all factors that can affect it (economic, political and psychological);
2. Price movement is subject to directional movements (trends);
3. History tends to repeat itself - the rules that were in force in the past will also be in force in the future.

The objectives of technical analysis are based on patterns in the past to determine, with a high degree of probability:

• current state of the market – trend, flat or random;
• the direction of the most probable future movement of the currency or other asset;
• the best entry point to the market;
• the level of placing a stop-loss order, or in other words, the price of the asset at which the analysis is considered erroneous.

In technical analysis, the following main methods of analyzing price movements are used - the principles of price movement, graphical methods of analysis, candlestick patterns, graphical models, mathematical analysis, technical indicators and other methods of analysis.

Principles of price movement in the foreign exchange market are based on the rule that the price movement is subject to directional movements (trends) and is expressed in a trend movement. This is detailed in the article. The concept of support and resistance levels is very closely related to the trend in Forex, which you can read about in the article.

Charts for technical analysis build in coordinates: price (vertical axis) - time (horizontal axis). In Forex, the following types of currency prices are distinguished, which are reflected in the charts:

opening prices (open) – prices at the beginning of a trading day or at the beginning of any trading period (month, week, hour, minute, etc.);

closing prices (close) – prices at the end of the trading period;

highest (high) - the highest prices observed during the trading period;

the lowest (low) - the lowest prices observed during the trading period.

In technical analysis, charts are built and considered at different time units - from 1 minute to 1 month. The larger the unit of time used to plot the chart, the longer is the time interval for analyzing the price movement and identifying the main trend using this chart.

Candlestick analysis.

The most popular type of charts is the Japanese candlestick chart - a chart, each element of which displays the range of price changes over a certain time. Japanese candlesticks are very popular due to the ease of presentation of information and ease of reading, since it displays four indicators at once in one element. A Japanese candlestick consists of a body and an upper/lower shadow (or wick). The upper and lower border of the shadow displays the high and low prices for the corresponding period. The boundaries of the body display the opening and closing price.

Candlestick analysis analyzes both individual candles and their combinations. There are a huge number of these combinations, and it is unlikely that anyone remembers them all, except for the authors of textbooks on the analysis of Japanese candlesticks. But the main types need to be known. For example these.

If you want to delve deeper into the types and analysis of Japanese candlesticks, then by the appropriate request on Google you will provide yourself with leisure for a very long time.

Graphical methods of technical analysis.

The main methods of graphical analysis are price channels and trend lines. A trend line is the most common straight line that connects the peaks (High or Low) of asset prices on your chart. An ascending trend line on a chart is constructed by drawing a support line through successively higher lows. A downtrend line is drawn by drawing a resistance line through successively lower highs.

Unlike trend lines, price channels limit the price movement from two sides, at the highs and lows of the price. There are 4 types of channels built into the Metatrader 4 trading terminal - fibonacci, linear regression, standard deviation and equidistant. There are also Donchian Channels, Keltner Channels and Bollinger Bands. However, the most popular type of channels for graphical analysis in Forex is the simplest equidistant channel.

Graphic models (figures) forex.

One of the rules of technical analysis is that price movements in the forex market are periodically repeated (“history repeats”), as a result of which the same figures periodically appear on price movement charts.

A technical figure is a graphical pattern that describes the price on the chart of a currency pair, and on the basis of which over time it is possible to make predictions about the further price movement. By identifying them and analyzing them, we can expect situations with a high probability of repeating. Technical patterns include bullish patterns, bearish patterns and reversal patterns. The most popular ones are head and shoulders, double top, triple top, flag, triangle and rectangle. The main figures of technical analysis are shown in the following figure.

Forex technical indicators.

Technical indicators are a mathematical function based on the values ​​of statistical indicators of the dynamics of a trading instrument (price, volume, etc.). Technical indicators are used to some extent by mechanical trading systems(advisers) in algorithmic trading. For any trading period, we have at least four price indicators - open, close, high, low. In the past, we have a huge number of similar time periods, and if we add to this a large number of possible mathematical operations (addition, division, subtraction, average calculation, etc.) applicable to 4 price indicators and for an unlimited period of time, we are with you we obtain an almost unlimited number of possible technical indicators.

It is very important to understand the very principle of operation of any technical indicator - indicator readings are formed by the price, and not the price depends on the indicator. Any indicator is an algorithm that uses historical data and visually interprets the calculation results.

Traditionally, technical indicators are divided into several main types: oscillators, trend, signal, information, volume, channel and others. There are a huge number of sites on the Internet that specialize in collecting and systematizing technical indicators. Only the standard Metatrader 4 terminal contains 7 trend indicators, 13 oscillators, 4 volume indicators and 6 Bill Williams indicators. The most popular indicators are moving averages, MACD, Bollinger Bands, Momentum, RSI, Stochastic Oscillator. How to choose the most necessary, most correct and most profitable indicators, we will discuss a little later.

Mathematical methods.

Unlike technical indicators, I single out purely mathematical methods of analysis separately. One of the main and well-known is the analysis of correlations between various currencies, currencies and other financial market instruments (stock indices), correlations between currencies and commodity assets (gold, oil, metal, etc.). For example, using the data on the OANDA website, you can analyze the correlation of a very wide range of assets over seven different time periods.

Other methods of technical analysis.

Exist huge number various other methods of technical analysis of the market, other than those described above. Among them are Elliot wave theory, COT (Commitments of Traders) reports analysis, currency futures analysis, VSA analysis (Volume Spread Analysis - volume and spread analysis), Ichimoku analysis, fibonacci levels, volume analysis, fractal, cluster, probabilistic, astral, extrasensory and various combinations of the above types of analysis.

If you try to put at least a small part of the indicators and other methods of technical analysis on the chart, it may turn out something like this:

If you have read up to these lines, you are already well done. I tried to describe the main directions and methods of technical analysis as simply and briefly as possible. But even on the basis of the foregoing, it becomes clear that it is extremely difficult not only to use all this, but also to study it. And is it necessary?

Our goal of working in the foreign exchange market is regular earnings and we need to use only those methods of technical analysis that correspond to our goal or, in other words, give us the opportunity to gain a statistical competitive advantage when opening transactions and reduce risks in case of erroneous decisions.

From the whole variety of means and methods of technical analysis, we must choose those that will be really useful to us. How? To do this, you must follow a few simple rules.

The basic principle of working in the financial markets is that in order to make a profit, the market must go in the same direction as your open position. If you sell, the market should fall; if you buy, the market should rise. And this is only possible if all the other (or most) traders in the market also open and continue to open positions in the same direction as you. And this, in turn, is possible only if you and most traders use the same (or similar) methods of technical analysis when opening a position, decision-making methods and decisions are based on the same information. From this it follows that the best methods of technical analysis and technical indicators are those that are most popular (used by most traders) and give unambiguous signals to open a position. They should be visible to all traders, regardless of timeframes, features of broker quotes, trading terminal, chart presentation type.

Every time you open a position, ask yourself a simple question - why would other traders trade in the same direction as you? What is the reason for the market moving in the direction you defined? What information does the market have and what does the price movement on the chart tell traders about. It is absolutely pointless to use a super unique technical indicator, the calculation method of which and the generated signals will be clear only to you. After all, the rest of the market will trade on completely different principles.

Approach technical analysis in the forex market as simply as possible. Two well-known methods will help you in this approach.

Pe The first is the so-called K.I.S.S. - (an acronym for “Keep it simple, stupid” - “make it easier, idiot”) - a principle that came to financial and technical analysis from design. He argues that most systems work best if they stay simple rather than getting more complex. Therefore, in the field of design, simplicity should be one of the key goals, and unnecessary complexity should be avoided. In technical analysis, this principle must be applied unconditionally.

The second method is called Occam's Razor - a methodological principle named after the English Franciscan monk, philosopher William of Ockham (English William of Ockham, 1285-1349). Briefly, he says: “One should not multiply things unnecessarily.” . It sounds like latin "Entia non sunt multiplicanda praeter necessitatem". In modern science, Occam's razor is usually understood as general principle, stating that if there are several logically consistent explanations of a phenomenon that explain it equally well, then, other things being equal, the simplest of them should be considered correct.

It is important to remember that Occam's razor is not an axiom, but a presumption, that is, it does not prohibit more complex explanations in principle, but only recommends the order in which hypotheses are considered, which in most cases is the best. The content of the principle for financial markets can be briefly summarized as follows: it is not necessary to introduce new rules or new methods of analysis to explain the movement of prices if this phenomenon can be explained exhaustively by known and commonly used methods.

Let's now try, based on the principles outlined above, to determine the minimum required set of technical analysis methods for working on the Forex market.

1. We leave the concept of a trend and as the basis of price movement in the foreign exchange market. The sequence of impulses and corrections to them is the main rule of the trend movement.

And don't forget that the best technical indicator is the price itself. Follow the price, analyze it, look for analogies in history, study price dependencies and correlations, follow the price reaction to news events and decisions of central banks. Be careful and consistent - and you will discover the secrets of technical analysis of the foreign exchange market. 2 ratings, average: 5,00 out of 5)

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FOREX ANALYSIS: TECHNICAL AND FUNDAMENTAL

Forex analysis is based on monitoring all indicators that affect changes in exchange rates. First of all, these are macroeconomic indicators. These include the country's GDP, inflation, interest rates, etc. As a rule, these data are presented in macroeconomic reports of countries. After their release, the exchange rate can change dramatically. The regularity of providing this information can be found in the economic calendar.

Forex technical analysis uses information about changes in exchange rates for different time periods. Based on past or actual data on changes in rates, forecasts are made of the value of exchange rates in the future. In such an analysis of the foreign exchange market, various mathematical forecasting methods are used to help traders quickly draw conclusions about the situation on the market and quickly make a decision to buy or sell a currency.

ANALYSIS IS DIFFICULT AND OUT OF THE BEGINNER'S POWER

It is not easy for a novice trader to understand the variety of information coming from forex and other financial markets. Therefore, forex analysis comes to the rescue, which is provided by large brokers, in particular TeleTrade. On the company's website you will always find forex technical analysis and analysis stock market , fundamental research and advice on forex. Market analysis is not easy and beyond the control of a beginner. Therefore, you need to rely only on professional research. Due to the prompt and high-quality analytics of the forex market, you can minimize your risks and make your investments as profitable as possible. And don't miss the trend. By the way, it is from professional analysts that you can learn to accurately determine the forex trend, make a technical analysis of the market and navigate the sea of ​​current and significant events in the forex currency market and other markets. In order for you to have a complete picture of the events, the market analysis section is updated daily.

This page regularly posts information from TeleTrade experts throughout the day based on a graphical analysis of the dynamics of popular currency pairs and gold.

The image combines several types of data - support and resistance lines, trading history and candlestick analysis chart. Each reference is accompanied by comments about the possible price movement.

Analytics for various currency pairs are published every 15 minutes. Morning and afternoon information is issued for each instrument, as well as additional information at night.

BASIC AXIOMS ​​OF FOREX TECHNICAL ANALYSIS

Forex technical analysis is based on three main axioms:

• Prices include everything

This assumes that all the information that can affect the exchange rate is already taken into account in this course and there is no need to additionally study the dependence of the exchange rate on political and macroeconomic factors in Forex technical analysis.

• The price follows the trend

This axiom says that the rate change does not occur randomly, but follows a certain trend or forex trend. Therefore, the time series of changes in exchange rates can be divided into some intervals in which the rate moved in one direction, obeyed one of three trends: downward, upward or sideways.

• History repeats itself

It follows from this axiom that movements in exchange rates are usually cyclical - upswings are followed by downturns, sideways market movements and new upswings, and if certain methods of technical analysis have worked in the past, then they will work in the future, since it is based on sustainable human psychology. That is, it is said that forex trends tend to repeat themselves.

The process of technical analysis of the currency market is based on identifying individual trends and (or) so-called patterns - typical patterns or figures that are formed on the charts. The most famous figures in technical analysis are the Flag, Double Top, Triple Top. A variation of the triple top is the "Head and Shoulders" pattern, in which the first and third peaks are lower than the second. Also, when analyzing Forex, there are patterns in the form of triangles. Based on the identified trends and using various methods of technical analysis, conclusions are drawn about where the exchange rate will go next and a decision is made on the best option entering and exiting a trade.

Despite the fact that many currency traders consider it more rational to use technical analysis, in our opinion, you should not use only it when trading. As well as it is not necessary to be limited to the use of exclusively fundamental Forex analysis. In reality, their competent combination is the basis of successful currency trading. Therefore, if you want your trading to bring high income, you should pay equal attention to both fundamental and technical Forex analysis.

Technical analysis of the foreign exchange market in real time is one of the most effective ways market research. It is a prediction of the price movement of an asset based on an analysis of past movements. The technique allows you to track fluctuations in the course in the past and, taking into account the data obtained, determine where the chart will go - north or south. The peculiarity of the technique lies in the fact that the price is studied solely on the basis of its movement. The complex technical does not include an assessment of the fundamental factors that could cause the quotes to move in a certain direction.

Fundamentals of technical analysis

The basis of technical analysis is a tandem of interrelated activities that allow you to determine the subsequent movement of the trend with maximum accuracy. The use of one tool within the technique, in particular one of the indicators or only support and resistance lines, is not effective. Comparison of data for several instruments allows you to make the most accurate forecast. The assessment of the market situation is based on several parameters, such as price changes, the volume of transactions, the number of open positions. The price always remains the dominant parameter for evaluating the market movement, the other values ​​considered only complete the picture and confirm the forecast made.

Basic principles of analysis

Real-time technical analysis of the foreign exchange market is based on three main principles that not only a professional, but also a novice trader should know:

• The currency market in its movement takes into account absolutely everything. The price chart reflects political and economic factors. For example, the lifting of EU sanctions against Iran for the supply of oil to the international market or the payment of EU debt by Greece can be attributed to the most powerful stimulants for the movement of currencies.
• Trends repeat themselves systematically. From time to time, the price will draw identical figures, which are called patterns. This is due to the fact that, despite the changing situation in the world, the psychological factor never changes, and traders in most cases use patterns of behavior in the market. To say more, traders are used to reacting to certain news in the same way. Knowing the reactions of market participants, you can open and close positions in a timely manner.
• At the heart of any movement is a trend. Technical analysis of the foreign exchange market in real time is simply impossible without determining the main trend in the market. If chaos reigned within its framework, there would be no question of any forecasting, and even more so of making money through speculation on prices.

Basic concepts in technology

Technical analysis of the foreign exchange market in real time is based on the basic concepts. It is impossible to start analyzing the situation if you do not understand trends. In total, there are three formats of market movement:

• Bullish trend (or uptrend) - the price is heading up.
• Downward trend (or bearish trend) - the price is directed downwards.
• A side trend (or flat) is a period of stagnation in the market, a certain moment of uncertainty. The price is moving in a narrow price range, and market participants are only thinking about which way they should open positions.

Let's pay attention to the fact that each of the trends in its pure form is a rarity in the market. Any movement of quotes is accompanied by rollbacks. Beginners are advised to trade only with pronounced trends. Even professionals are wary of flat market conditions, since probable profits are not justified by high risks.

Technical analysis tools

Technical analysis tools can be:

• bar charts;
• indicators;
• oscillators;
• channels;
• waves;
• graphic shapes.

Each of the tools has certain advantages. A detailed understanding of each functional will allow you to analyze the situation and take the right decision. You should not be guided by only one instrument, as its signal for the transaction may be false. Another thing is when several instruments show identical signals at the same time, which opens up wide prospects for making money. Previously, technical analysis tools were not automated, as they are today. In order to analyze the situation, it was necessary to draw graphs by hand and carry out calculations. So learning each tool is not that difficult, but it is essential.

Technical analysis figures are the most reliable patterns

Within the framework of technical analysis, there are well-established patterns that are determined by the behavior patterns of both large market participants and small ones. They are embodied in the format of certain graphic figures. An example is a flag and a double top, a triple bottom and a head - shoulders. As soon as the figure appears on the chart, and the price passes a certain line, we can confidently talk about the further direction of movement.

What do the figures say and why are they needed?

Note that there are patterns of trend continuation and trend reversal. The frequency of occurrence of such patterns on the chart is different depending on the time period and on the traded instrument (currency pair). The percentage of working out of such patterns can be from 80% and higher. It is not enough to understand the theory. Technical analysis of the online currency market based on graphical figures should be accompanied by practice. Only by trading for a long time, you can learn to see patterns and use them to your advantage. In practice, any figures will not have such a clear and concise appearance, as in the pictures.

Technology Benefits

Technical analysis of the Forex currency market is the foundation of the basics, from which every beginner's acquaintance with the foreign exchange market begins. Experienced players use the technique as a tool to analyze the behavior of beginners. So, inexperienced traders often make decisions based only on emerging support and resistance lines. Knowing this, major players can predict the direction of movement due to the mass nature of the solution, which allows them to occupy the most advantageous positions. It is not for nothing that there are statistics according to which only a few percent of participants earn in the foreign exchange market. There is even a theory that, acting contrary to the signals of technology, you can get a solid income, but many will begin to dispute this issue.

Understanding technical analysis is a step towards successful trading

The basics of technical analysis of the currency market, although they are basic, cannot serve as the only tool for building your own. Effective trading happens only when, in addition to the technique, fundamental analysis and computer are used. You should not use all the tools of the technique at the same time, as this will only overload the chart and lead to confusion in the signals. Experts recommend that beginners study in detail one tool in each type of market analysis, depending on the most appropriate trading format. This approach will avoid losses and losses, will bring good trading results.

Forex technical analysis. Rules and principles of application

What is the technical method of analysis based on? How to apply the analysis and technical capabilities of the Forex platform to earn maximum profit?

Learn your technical analysis - earn good money

Technical analysis is a method by which traders forecast quotes based on the history of currency movement at a certain time.

Pricing in the foreign exchange market is based on a large number of factors that are almost impossible to combine into a single whole. With 100% probability, even the most experienced professional cannot predict the entire movement of currency prices, so the charts are divided into time intervals, within which the study takes place according to the five most important indicators: opening deals, closing deals, minimums and maximums, as well as trading volume. All this suggests that analytics is able to process only 5 indicators, and everything else - patterns, indicators and figures - are derivatives.

3 postulates of technical analysis

1. The cost of quotes is taken into account by all market participants

Many external economic and political factors affect pricing. In the conditions of using telephone communication and the Internet, there is practically no difference in time between the release of relevant economic news and the market reaction to them. But with the use of technical strategies and analysis, it is not necessary to monitor the outgoing news - only the history of price changes is important.

2. Prices are always psubject to trends

Quotes are constantly moving in accordance with the trend in the market: prices either increase or decrease, with the exception of rare breaks called flats - sideways movement of currencies.

3. Price historyformation is always repeated

The market will react to recurring situations in the same way, so with the help of technical analysis, knowledge and a little effort, you can predict the dynamics of the movement of a particular currency in the future and get a good income as a result of your work.

Founder of technical analysis

The set of data on the volume of transactions is displayed on a special chart in a linear form, where the points forming the line are information about all transactions made. This chart is called a line chart, but due to the presence of time intervals it is called a tick chart.

A tick chart contains data about all trading operations for certain instruments. This is the most powerful tool in terms of displaying a large amount of information about the price movement, however, it is not suitable for analysis, since processing such an amount of information is not easy even for a super-powerful computer, not to mention the human brain. Therefore, the analysis is carried out within a certain period of time - a time frame.

A timeframe is a period of time that separates a chart. They consist of five main indicators: the value of the quote at the beginning of the frame and at its end, the minimum value of the currency, its maximum value and the volume of transactions for a given period of time.

Previously, only line charts were used in technical analysis, on which it was impossible to demonstrate currency fluctuations over a certain period of time. In this regard, trading platforms began to actively use instrumental charts based on the Japanese candlestick.

Candle is a world standard that displays graphical fluctuations in the value of currencies. To create Japanese candlesticks, four points are required: the highest and lowest price values ​​reached over the time period, as well as a rectangle drawn from the moment the frame's opening cost to the point of its closing cost. If the quote has increased, then the drawn figure will be empty, and if the price has decreased, it will be shaded. The rectangle, in fact, is the body of the Japanese candlestick.

The volume chart is usually built below the value chart and is shown in the form of a bar attached to each candle.

Which time frame to choose is a personal matter for each trader, but it must be remembered that the pace of trading will depend on this choice, as well as the trader's involvement in concluding a large number of transactions.

How to work with time intervals

1. It is necessary to monitor all appearing candles. This means that for a time frame of half an hour, you need to follow the chart every 30 minutes, and so on.
2. When choosing a strategy, it is important to respect the chosen intervals and observe them carefully, otherwise the strategy will not work.

The constant movement of the foreign exchange market

The currency market is constantly moving, and the direction of the value of currencies is shaped by the mood of the platform itself and its traders. There are 2 states or phases of a quote: an upward or downward movement or a flat.

Varieties of trends

Ascending - appears by alternating a certain number of maximum currency quotes in a certain time frame. Future highs must necessarily be greater than the previous one in order to identify an uptrend. There are also alternating lows, each higher than the last. If the currency cannot break through the last maximum, then this means a weakening and a gradual end of the trend, which will lead to a flat state or a trend reversal in the opposite direction.

The descending one is determined by analogy with the ascending one, but instead of local maxima, there are decreasing local minima.

Resistance and Support Trait

Based on the price chart information, certain points can be marked, lining up in the form of areas. These points appear when the value of the quote reaches a certain level. While approaching these levels, the quote slows down the movement, or goes in the opposite direction, as if pushing away from it.

The support line is based on several points of local minima observed on the chart. These points are located on the same horizontal level.

The resistance line is based on the local maximum points that were on the chart. These points are also at the same horizontal price level, and the support level must be above the existing value of trading instruments.

Breaking levels

Breaking through a level is overcoming the cost of a particular level and fixing beyond it. As a rule, this symbolizes a change in trend from a downtrend to an uptrend, or vice versa.

On small time frames, the chart will show a huge number of levels. As a rule, a qualitatively tested level is based on several points, and its breakdown means a significant volatility of the quote, for example, aud usd.

The impossibility of breaking through a certain level also makes it fundamentally important for a trader. If there is a trend in the euro/dollar pair, the line can become a powerful enough barrier to reverse or correct the price movement.

Figures on charts

How to understand if the trend has ended or is still relevant? For this, reversal and continuation patterns are used.

Reversal patterns are figures, the appearance of which on the monitor screen symbolizes a change in the direction of the price movement trend. All of them are very similar to each other, if we consider them under the prism of the price behavior of quotations.

The continuation model means the continuation of the trend and is defined on the monitor of the trading floor as such figures as flags, pennants, triangles and others.

Forex indicators

With the advent of modern computing equipment, it became possible to use indicator analysis.

It is based on online mathematical programs-algorithms (for example, Autochartist), which cannot be replaced by any book or analysis technique. You can download them for free. They simply and clearly demonstrate to users the mood of traders and the market, however, this method could not replace the graphical analysis of the market, but only supplemented it. Today, the combined method of real-time technical analysis is most common.

Outcome

Forex technical analytics is undoubtedly the most important element of market situation research for a trader, but when doing technical analysis, do not forget about fundamental methods. You can study various methods of forecasting and analytics of the foreign exchange market on our website.