Indices Technical Analysis is Based on 3 Factors Common in the Trading Market:

1. Stock Price Moves in Trends

Trading stock price movements follow trends. This means that after a trend has been established, the future stock price movement is more likely to be in same direction as the trend than to be against it. Most strategies are depending on this stock technical analysis concept -trend trading.

2. Indices Price Movement Discounts Everything

technical analysis only considers stock price movement & assumes that, at any specific time, trading price reflects everything that has or could affect the instrument including even the fundamental factors. This only leaves study of stock price, which is a product of the supply & demand for indices in the market.

3. History Tend to Repeat Itself

History repeats itself mainly in terms of stocks price movement. Repetitive nature of stock market moves is attributed to traders investor psychology: in other words, trade participants tend to provide a consistent reaction to the market most of the time. technical analysis uses chart patterns to analyze these stock price movements. Although these charts represent historical data they are still relevant because they illustrate stock chart patterns that often repeat themselves.

List of All Indicators - Indices Technical Analysis Explained PDF - Indices Technical Analysis PDF

Understanding this stock technical analysis of the market can be a valuable indices tool in determining the trend of any market and assisting with entry and exit levels for your stock trades.

The goal of these stock technical analysis methods is to help traders determine when the market is trending, and when it isn't. If the price is moving in one particular direction, then we want to be aboard. If the instrument is not moving in a particular direction, all you are going to do is lose money as you will get whipsawed around and this is not what we want as indices investors.

Unfortunately, many traders fight the trend and buy or sell in the opposite direction of a this trend direction, trying to pick a top or a stock market bottom, only to see the market move further in direction of the trend.

Another common mistake traders often make is adding on to a losing indices position, averaging a loss. This isn't a good strategy especially in a strong trending market. It is something that experienced investors never do. The trend is your friend, never go against it.

This stock technical analysis studies alert investors of setups and there are no certainties in financial market. Profits come from using tested strategies & indices methods to find a trending market and taking stock indices trades in the same direction of the market trend.

With so many indices trading investors using similar indices tools, technical analysis can become a self fulfilling prophecy. If many indices trading investors use the same levels as a buying point, the price goes up as everyone will make similar stock technical analysis moves. However, the question is always how long these trading moves will last?

Understanding this stock technical analysis methods will give the charts some meaning when you look at them and apply technical analysis. technical analysis will help you understand why certain stock price movements occurred.

charts are used with technical indicators to look for stock chart patterns which have occurred in past under certain conditions. When these conditions are noted again, you can use the past stock chart patterns studies to make a buy or sell decision.

Some of the most common technical indicators include: Indices Technical Analysis Explained PDF

• MAs Indicator
• Relative Strength Indicator
• Stochastic Indicator
• MACD Indicator
• Fibonacci Retracement Indicator
• Bollinger Bands Indicator

Most indicators are pictured separately from the chart usually below it. This is because these indicators often use a different scale than that of the price chart.

Some of the indicators are shown on the price chart itself, such as Moving Averages and Bollinger bands - these indicators are referred to as stock price overlays.

Explanation of these indicators is found under the tutorial: List of All Indicators - Indices Technical Analysis Tutorial - Learn Technical Analysis Tutorial

SUMMARY

1. Indices Technical Analysis Relies on Defining Probabilities
2. Indices Technical Analysis Uses History of Price Patterns
3. Indices Technical Analysis Uses Several Analytical Tools (Indices Indicators)
4. Indices Technical Analysis Uses Chart Patterns

Learn Technical Analysis Tutorial

Most traders prefer technical analysis - learning the technical analysis methods also takes time to learn due to its nature which involves abiding by the trade technical rules.

To learn how to trade successfully, it's important that you understand the Three strategies, outlined below:

1. Indices price moves will always follow a trend which can be identified by looking at the chart patterns or the candlesticks stock charts. If any indices trading investor tells you that you can also profit from the counter-trends consistently it will not be possible because the trend is the only proven method of making money in the market.

2. The market forces will drive the prices up or down depending on supply and demand. technical analysis seeks to measure the demand supply of a instrument using various stock technical analysis tools and indicators. The demand supply is reflected in the price action. Therefore, by simply looking at the price movements themselves you can try and predict what direction the price is likely to move towards using one or two technical indicators - technical analysis indicators like the moving average or support and resistance levels stock indicators.

3. The stock market not only shows the history of the past stock prices, but will also follow the trend that was in place, until its trend direction reverses. Some very important indicators used to determine these stock market movements are Moving Averages, MACD and Bollinger Bands Indicators.

When stock price starts to consolidate, which means there is no trend, you should use a different approach to analyze the market. You should use support and resistance levels and breakout strategies to analyze the ranging stock market prices.

When the market retraces, you should use patterns & technical indicators to analyze whether the current trend will continue or reverse.