Technical analysis for trading is a method of studying price movements in markets (such as cryptocurrencies, stocks, or commodities) with the aim of predicting future trends, using charts and mathematical indicators only, without relying on news or direct economic data.
The basic idea in technical analysis is that price reflects everything, and price movements repeat because trader behavior repeats.
---$BTC
The most important elements of technical analysis:
1. Charts
Lines that represent price movement over time (candlesticks, linear, or bars).
They show support areas (where the price tends to rise) and resistance (where the price tends to fall).
2. Technical Indicators
Mathematical tools based on price or volume data, such as:
RSI (Relative Strength Index) → measures overbought or oversold conditions.
MACD → measures trend momentum.
Moving Averages (MA) → indicate the general trend of the market.
3. Price Patterns
Shapes that repeat on the chart and indicate the likelihood of trend continuation or reversal, such as:
Head and Shoulders
Triangles
Double Tops and Bottoms
4. Risk Management
Determining stop-loss and take-profit levels.
Determining the appropriate position size.
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