What a Technical Analysis Chart Allows a Trader to Identify
Technical Analysis forecasts future price movement based on examination of past price movement. Technical analysis does not make absolute predictions but helps investors anticipate what is “likely” to happen to prices over time.
A chart pattern develops based upon the price of a stock and reflects changing expectations of the market. Patterns can develop over several days, months or years. While no two patterns are the same, they are very close and can be used to predict price movements.
A technical analysis chart can identify chart patterns as well as:
- Price Trends
- Support and Resistance Areas
- Strength and Maturity of Trend
- Entry Levels for trades and investmentsv
- Trading Ranges
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