Technical Analysis

What Is Forex Technical Analysis? Technical analysis in Forex is the study of historical price data, primarily through charts and indicators, to forecast future price movements. It assumes that all market fundamentals are already reflected in price. Core Principles Price Discounts Everything – All news and fundamentals are already priced in. Price Moves in Trends – Markets tend to move in directional trends. History Repeats Itself – Market behavior often follows patterns over time.   Popular Tools & Indicators TOOL/INDICATOR USE Support & Resistance Key price levels where price tends to pause or reverse Trendlines & Channels Identify direction and strength of trends Moving Averages (MA) Smooth price data to identify trends Relative Strength Index (RSI) Measures momentum (overbought/oversold) MACD Identifies trend direction and reversals Bollinger Bands Measures volatility and potential breakouts Fibonacci Retracement Predicts pullback levels in trends Advantages Great for short-term trading Clear entry/exit signals Can be automated with algorithms Limitations Doesn’t account for economic fundamentals False signals in choppy markets Needs discipline and practice to master