An Insight on Technical Analysis

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For a person to trade effectively in the stock market or the commodity market, he must follow some strategy to trade so that he can follow a proper path to incur profits in the trade. Most of the people follow technical analysis for trading. Technical analysis is a whole field to determine or anticipate the future price movements. Analysis is based on the past data on price and volume to determine the future trends of the market. Technical analysis is not based on the real value of the stock or the commodity, but depends on the past trends and movements of the stocks and commodities.

Various advisory firms hire experienced technical analysts to generate accurate Stock Cash Tips as well as Stock Future Tips. One can rely on these tips also but the advisory firm should be a reputed one.

Assumptions for Technical Analysis

Technical analysis is based on the following assumptions:

  • The market describes everything in it.
  • The prices of the stocks move in the trend
  • The history will tend to repeat itself several times.

The market describes everything in it

The technical analysis does not consider the fundamental analysis to account for the price movements. It considers that the price movements account for everything and there is no need to consider the fundamentals and other economic factors while analyzing the price movements.

The prices of the stocks move in a trend

In technical analysis, it is assumed that the prices follow trends. That is, they use to move in the trends. Thus, if the stock or the commodity prices are moving in an uptrend, there is a high probability that it will continue to do so. Similarly, if the prices are in down trend they will continue to move down. In technical analysis, it is always advised to trend with the trend and not against the trend.

The history will tend to repeat itself several times

In technical analysis, it is believed that the historical price movements will repeat itself. In other words the price movement behaviors will tend to repeat it. Thus, in technical analysis the charts are studied and regular patterns which repeat themselves are identified. These patterns are expected to repeat themselves. These patterns are studied extensively in the technical analysis.

Thus, technical analysis can be used to predict the stock or commodity price movements. We at  ProfitAim Research have experienced technical analysts who give accurate share market tips and calls so that one can trade effectively and profitably.

The selection of the advisory firm which provide accurate Stock Cash Tips and Stock Future Tips is the key to success in the Stock Market. Some parameter to judge the credibility of advisory firms are:

  • The advisory firm should be SEBI registered Investment Advisory Firm. This will ensure that the advisory firm is reputed and follows standard procedures.
  • The advisory firm should have other accretions and certifications like ISO 9001.

These factors will ensure that the advisory firm is a genuine one and one can benefit from it by trading successfully.